Electrolux 2003 Annual Report Download - page 8

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6Electrolux Annual Report 2003
Cost-efficiency
Fewer product platforms
We are steadily consolidating the number of
product platforms, which in Europe will be
more than halved by year-end 2005 in com-
parison with 2001. In 2004 we will have only
one platform for dishwashers in Europe, as
against the previous four. The trend to global
platforms is intensifying, e.g. we aim to have
a single global platform for all our front-loaded
washing machines.
The benefits of fewer platforms include
greater standardization of components, fewer
product variations, and increased specializa-
tion and consolidation of production.
Reduction of product platforms in Europe
Number of product platforms to be reduced
by more than 50% by 2004–2005
Product area Total reduction Year-end 2003
Refrigerators 46 17 platforms 33
Cookers 41 27 structures 33
Ovens 32 10 cavities 25
Washing machines 13 6 platforms 10
Dishwashers 4 1 platform 2
Keys to greater cost-efficiency
• Fewer product platforms and product variations
• Standardized components
• Streamlining/specialization of production
• Consolidation and relocation of production facilities
• Improved logistics/demand flow
• Focus on cost to serve
• Fewer suppliers
• Greater share of purchases from
low-cost countries
Electrolux today is a much leaner and more
focused company. But there are still extensive
opportunities to reduce complexity and
increase cost-efficiency within the Group.
We are taking action to remove overlaps
within the organization, reduce the number of
product variations and increase standardiza-
tion, streamline and consolidate production,
and make our purchasing even more efficient.
This is the way to finance investments in
product development and brands. Greater
cost-efficiency remains the foundation of our
future.
In recent years we’ve implemented a
number of changes in this direction. These
have included establishing a more in-depth
annual strategy and planning process, intro-
ducing an organization based on product
lines with global product councils, improving
the efficiency of purchasing, and investing in
production facilities in low-cost countries.
Taking action for greater
cost-efficiency