Danaher 2011 Annual Report Download - page 27

Table of Contents
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We compete in markets in which we or our customers must comply with federal, state, local and foreign regulations, such as regulations governing health and
safety, the environment, food and drugs, privacy and electronic communications. We develop, configure and market our products to meet customer needs
created by these regulations. These regulations are complex, change frequently and have tended to become more stringent over time. Any significant change in
any of these regulations could reduce demand for our products or increase our costs of producing these products. In addition, in certain of our markets our
growth depends in part upon the introduction of new regulations. In these markets, the delay or failure of governmental and other entities to adopt or enforce
new regulations, or the adoption of new regulations which our products and services are not positioned to address, could adversely affect demand for our
products. In addition, the manner in which regulations and related regulatory deadlines impact demand for our products may be substantially different from
period to period.
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We have a number of U.S. collective bargaining units and various non-U.S. collective labor arrangements. We are subject to potential work stoppages, union
and works council campaigns and potential labor disputes, any of which could adversely impact our productivity and results of operations.
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In 2011, approximately 58% of our sales were derived from customers outside the U.S. In addition, many of our manufacturing operations, suppliers and
employees are located outside the U.S. Since our growth strategy depends in part on our ability to further penetrate markets outside the U.S. and increase the
localization of our products and services, we expect to continue to increase our sales and presence outside the U.S., particularly in emerging markets, such as
China, India and Brazil. Our international business (and particularly our business in emerging markets) is subject to risks that are customarily encountered
in non-U.S. operations, including:
• interruption in the transportation of materials to us and finished goods to our customers;
• differences in terms of sale, including payment terms;
• local product preferences and product requirements;
• changes in a country’s or region’s political or economic conditions (including safety and health issues);
• trade protection measures and import or export restrictions and requirements;
• unexpected changes in laws or regulatory requirements, including negative changes in tax laws;
• limitations on ownership and on repatriation of earnings and cash;
• the potential for nationalization of enterprises;
• limitations on legal rights and our ability to enforce such rights;
• difficulty in staffing and managing widespread operations;
• differing labor regulations;
• difficulties in implementing restructuring actions on a timely or comprehensive basis; and
• differing protection of intellectual property.
Any of these risks could negatively affect our financial statements and growth.

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Our facilities, distribution systems and information technology systems are subject to catastrophic loss due to fire, flood, earthquake, terrorism or other
natural or man-made disasters. In addition, attacks on our information technology systems and networks could result in the compromising of confidential
information, manipulation or destruction of data or improper use of our systems and networks. If any of these facilities, systems or networks were to
experience a catastrophic loss or attack, it could disrupt our operations, delay production and shipments, result in defective products or services, damage
customer relationships and our reputation and result in legal exposure and large repair or replacement expenses. The third-party insurance coverage that we
maintain with respect to these and other risks will vary from time to time in both type and amount depending on cost, availability and our decisions regarding
risk retention, and may be insufficient or unavailable to protect us against losses.
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Source: DANAHER CORP /DE/, 10-K, February 24, 2012 Powered by Morningstar® Document Research℠
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