Invacare shrinks manual wheelchair line

Sunday, December 31, 2006

ELYRIA, Ohio - To reduce costs and improve its manufacturing efficiency, Invacare plans to discontinue its line of Kuschall custom manual wheelchairs in the United States, the company announced last week.

"Kuschall was doing OK, but it wasn't profitable for us," said Invacare Vice President Brian Ellacott. "(Medicare) reimbursement is going to be reviewed in 2007, and we know it's going to go down. So if it wasn't viable financially currently, the picture could get worse in 2007 and 2008."

Invacare bought the Kuschall name and distribution rights several years ago. The lightweight custom chairs never lived up to company expectations in the United States where stiff competition, a small niche customer base and a high price point worked against the brand, Ellacott said.

Invacare accepted orders for Kuschall wheelchairs until Dec. 29, 2006. It will continue to provide Kuschall parts in the United States, and the chairs will still be available in Europe, where the brand is better known and, more importantly, profitable. Additionally, Invacare is exploring distribution of Kuschall chairs in the United States through specialty distributors, Ellacott said.

By reducing its line of manual chairs, Invacare pulled a page from the playbook that it has been encouraging providers to adopt for months. Rather than stock, deliver and service many brands within a product category, providers should limit the manufacturers they do business with. That strategy generates volume discounts, simplifies repairs and deliveries, reduces inventory and produces a host of other savings, say Invacare officials.

Likewise, in this era of shrinking reimbursement, manufacturers must rip cost out of their own operations--inventory, marketing, etc.--by creating formularies that reduce overlapping products. Savings can then be passed on to providers who, in turn, become more competitive, Ellacott said.

"Providers and manufacturers don't have a choice anymore," he said. "The economics of the new reimbursement world is forcing us to move in that direction."