Callaway 2001 Annual Report Download - page 5

nearly doubled our golf ball share from a year ago as we
introduced the CB1 and CTU 30 products during 2001. More
important, because of our superior technology we are now
recognized as a product innovator in golf balls. Golf clubs and
accessories accounted for $761.3 million in revenues while golf
ball sales grew to $54.9 million.
Internationally, we achieved $372.1 million in sales despite
declining currencies in most foreign markets. Had currency
exchange rates remained constant year over year, international
sales would have grown to $405.0 million. These results reflect
the continued share gains and brand strength we are building
through the strategy of owning and expanding our distribution
in these key geographic golf regions. In Japan in particular, which
is the second largest golf market in the world, we continue to
have year over year gains while the economy and the golf
industry in general have declined. Our strategy of differentiating
ourselves by providing market specific products and superior
service to our customers and consumers alike has been
successful. We have become a true global company. When the
economies in these countries rebound we will be well positioned
to reap further benefits.
As previously mentioned, the senior management team developed
a strategic 3-to-5 year business plan during 2001. This plan centers
on goals in four key areas:
Organization Development
Maintaining Product Leadership
Increasing Long Term Profitability
Developing Brand, Consumer and Customer Loyalty
Through these broad goals, and the strategic initiatives being
implemented to achieve them, the Company will deal with change.
Change we will introduce through innovation in our products;
and change we will manage through our processes and practices.
Measuring results against this plan, adjusting actions to meet
market conditions and executing on the opportunities to
differentiate ourselves will synthesize all of the Company’s diverse
elements to be world class, not just best of class.
Some of the significant actions already taken to address these goals
are the announced institution of a Product Management Structure,
a continuing commitment to Research and Development, the
introduction of Six Sigma Techniques throughout our processes,
the establishment of three unique Brand Building Investments,
and the implementation of an e-Business Solution to enhance and
improve customer relationships.
In our newly created Product Management Structure we have
appointed four key officer positions that have responsibility for
the life cycle profitability of our products in woods, irons &
putters, balls, and licensing & accessories. These individuals,
working through a matrix organization, have responsibility for
every element involved in the development and introduction of a
new product. Further, they are the single focal point within the
Company regarding all aspects of a product’s life.
We believe we have led the industry in research and development
over the past five years, typically spending an average of 4% of
annual sales on R&D. This commitment will continue. Later in
this letter, I give a complete overview of our new product
introductions, and I will only say here that there is still more to
come in product advancements.