Logitech 2007 Annual Report Download - page 73

Volume Manufacturing Capability Resulting from Strong OEM Relationships
We believe our manufacturing capabilities are a significant competitive advantage. Over the past 11 years
Logitech has built a significant manufacturing presence in Asia, where our ISO 9000-certified manufacturing
facilities are currently producing more than 60 million units per year. As a result, we have been able to maintain
strong quality process controls and have realized significant cost efficiencies. Our manufacturing expertise
extends beyond production to include logistical support, just-in-time supply and process engineering.
Logitech’s manufacturing capability has allowed us to continue our long-established relationships with large
OEM customers. We currently sell to the majority of the world’s largest PC manufacturers, as well as to most of
the next layer of systems manufacturers and system integrators. Because Logitech’s engineering and design staffs
work collaboratively with OEM customers on the specifications for future products, we believe our OEM
relationships provide valuable insight into the future of the computer marketplace and technology trends. Further,
we plan to extend our OEM presence with both our traditional customer base and new classes of customers,
including console platform manufacturers, game publishers and mobile-technology vendors.
The combination of a strong retail brand and a high-volume manufacturing operation linked to our OEM
relationships provides Logitech with a competitive advantage that we believe is unparalleled among our
competitors.
Global Presence
Logitech is a global company capable of drawing upon the strengths of our global resources, global
distribution system and geographical revenue mix. With manufacturing facilities in Asia, engineering teams in
North America, Europe and Asia, major distribution centers in North America, Europe and Asia, as well as sales
and marketing offices in major cities worldwide, we have worldwide access to leading technology, markets,
personnel and ideas.
Expertise in a Broad Array of PC Peripherals
As we broaden our product portfolio beyond the PC platform, we have also continued to expand our
portfolio of products for desktop and notebook PCs, offering a broader range of personal peripherals that people
use every day as they work, communicate and play at their PC. Logitech personal peripherals bring together a
broad variety of products that individuals – business people, home users, gamers and others – need to make their
time on the Internet and time at the computer more productive, comfortable and enjoyable. As a result, Logitech
is positioned to offer “one-stop shopping” for peripherals that have been designed to work seamlessly together.
Industry Overview
Increasingly affordable prices and wider availability of business, consumer, education, and communication
applications have created a very large installed base of desktop and notebook personal computers. We believe
that market penetration of PCs and other information access devices, already high in developed countries, is
likely to increase worldwide.
In addition, continuing growth in processing power and communications bandwidth, the increased
accessibility of digital content, and the pervasive access and use of the Internet, create opportunities for new
applications, new users and dramatically richer interactions between users and digital information.
These developments create new demands by users who want to take full advantage of the increased
processing power, new applications and new technologies in an intuitive, productive, comfortable and convenient
manner.
Today’s desktop and notebook PCs have evolved into affordable multimedia appliances or “digital hubs”
capable of creating and manipulating vast amounts of graphics, sound and video. The interface devices sold with
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