Invacare 2014 Annual Report Download - page 11

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I-7
Discontinued Operations
Invacare distributed numerous lines of branded medical supplies including ostomy, incontinence, diabetic, enteral, wound
care and urology products as well as home medical equipment, including lifestyle products through Invacare Supply Group, Inc.
(ISG), which was sold on January 18, 2013. Invacare manufactured and sold medical recliners for dialysis clinics through Champion
Manufacturing, Inc. (Champion), a subsidiary of Invacare that was sold on August 6, 2013. Invacare also manufactured and sold
stationary standing assistive devices for use in patient rehabilitation through Altimate Medical, Inc., a subsidiary that was divested
on August 29, 2014. See Item 7. Management's Discussion and Analysis of Financial Condition and Results of Operations -
Discontinued Operations.
For financial information regarding reportable segments, including revenues from external customers, products, segment
profitability, assets and other information by segments, see Business Segments in the Notes to the Consolidated Financial Statements
of this Annual Report on Form 10-K.
WARRANTY
Generally, the Company’s products are covered by warranties against defects in material and workmanship from the date
of sale to the customer for various periods depending on the product. Certain components carry a lifetime warranty.
COMPETITION
North America and Asia/Pacific
The home medical equipment market is highly competitive and Invacare products face significant competition from other
well-established manufacturers and distributors. The Company believes that its success in increasing market share is dependent
on providing value to the customer based on the quality, performance and price of the Company's products, the range of products
offered, the technical expertise of the sales force, the effectiveness of the Company's distribution system, the strength of the dealer
and distributor network and the availability of prompt and reliable service for its products. Various competitors, from time to time,
have instituted price-cutting programs in an effort to gain market share and may do so again in the future.
Europe
As a result of the differences encountered in the European marketplace, competition generally varies from one country to
another. The Company typically encounters one or two strong competitors in each country, some of whom are becoming regional
leaders in specific product lines.
MARKETING AND DISTRIBUTION
North America
In the United States, Invacare products are marketed primarily to home medical equipment (HME) providers or long-term
care providers who in turn sell or rent these products directly to consumers or residents within the non-acute care settings. The
Company also employs a “pull-through” marketing strategy to medical professionals, including physical and occupational
therapists, who refer their patients to HME providers to obtain specific types of home medical equipment.
Invacare’s North America/HME sales and marketing organization consists primarily of a sales force which markets and sells
Invacare® branded products to HME providers. Each member of Invacare’s HME sales force functions as a Territory Business
Manager (TBM) and handles all product and service needs for an account, thus saving customers’ valuable time. The TBM also
provides training and servicing information to providers, as well as product literature, point-of-sale materials and other advertising
and merchandising aids. In Canada, products are sold by a sales force and distributed through regional distribution centers to health
care providers throughout Canada.
TBMs are supported by the Inside Sales Department that provides increased sales coverage of smaller accounts. Inside sales
offers cost-effective sales coverage through a targeted telesales effort. The Company's Technical Education department offers
educational programs that place emphasis on improving the productivity of HME repair technicians. The Service Referral Network
includes numerous providers who honor the Company's product warranties regardless of where the product was purchased. This
network of servicing providers seeks to ensure that all consumers using Invacare products receive quality service and support that
is consistent with the Invacare brand promise - Making Life's Experiences Possible™.