Invacare re-allocates spending to drive new product sales

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Friday, February 14, 2020

ELYRIA, Ohio – Now that it has a more robust pipeline in place, Invacare needs to more effectively commercialize its new products, says Matthew Monaghan.

Last year, the company launched in North America the ROVI A3 Power Wheelchair with Motion Concepts MPS Maxx Modular Power Standing System and the Invacare microAIR Therapeutic Support Surfaces, among other products.

“In 2019, we launched many new innovative products, but we admittedly weren’t as effective in commercializing them as expected,” said Monaghan, chairman, president and CEO, during a conference call to discuss the company’s fourth quarter and year-end financial results. “In 2020, we have actions in place to accelerate sales growth by investing in sales and marketing talent, making our product launch programs more consistent, increasing the number of demo units, driving customer awareness and reallocating spending to all of this, while still lowering SG&A expense.”

Invacare needs to hit the ground running, with additional new products rolling out in 2020, including a new line of front-wheel and rear-wheel drive power wheelchairs in the first half of the year.

Monaghan noted that these types of wheelchairs make up roughly 30% of the wheelchair market worldwide, yet Invacare hasn’t had a “modern product or product at all” in this product category since the company’s consent decree with the U.S. Food and Drug Administration.

“So getting these products back out and refreshed is really important for Invacare,” he said. “But now we believe the products we’re bringing to market in those categories are at the top of the line, in terms of performance and capabilities, modern aesthetics and the kinematics that help the occupant move very smoothly and seamlessly.”

Among the highlights for Invacare in the fourth quarter was a 2.8% increase in mobility and seating sales, driven by increased sales of power wheelchairs.

Invacare also plans to roll out a new line of stationary oxygen concentrators this year.

“We’ve done a tremendous amount of work to integrate our stationary oxygen concentrator line,” Monaghan said. “(We’ve made) huge investments and reliability improvements over the last 18 months, which are reflected in what customers are seeing and experiencing, and that will lead us to a whole new product line of stationary concentrators in 2020.”

Add this new line to Invacare’s HomeFill and Platinum Mobile Oxygen Concentrator and the company is better positioned to turn around what was a rough quarter for the product category, which saw a 20.7% decrease in net sales of $2.8 million in the fourth quarter.

“We’re in a very, very different place than we were a year ago, when our repertoire was in a substantial decline in North America, initially as a result of reimbursement changes and then as a result of internal changes that we made to deliver the best unit,” Monaghan said.