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Fisher and Paykel Appliances

Morris, Kevin(2004-01-01)

Abstract

[This case is restricted. Please contact the Case Centre for more details] In April 2003, John Bongard, CEO of Fisher and Paykel Appliances, returned from the annual Kitchen and Bathroom Show in Orlando, Florida, with a quiet optimism. The company’s top-loading SmartLoad dryer, to be launched within the next year, had received glowing reviews from industry critics and buyers. The innovative product (expected to have a retail price of $US799) had generated such positive feedback that Bongard decided to increase its initial production run to 60,000 units—double the company’s original estimates. A few months later in early August, the 49-year-old Bongard announced the company had signed a worldwide distribution and marketing alliance with Whirlpool, the $11 billion appliance company based in Michigan. And then in October, they partnered with Pascoe’s and acquired the finance arm of Farmers for $188.7 million. These events were typical of the change that had dominated the company’s developments during the past few years, particularly since 2002 when the company separated from Fisher and Paykel’s healthcare and finance entities and listed on the NZX and ASX exchanges. As a company that had traditionally concentrated on manufacturing for the Australasian markets, the appliances company were now committed to a global export strategy. The Australian market accounted for 75 percent of their sales, but their success there had been challenged in recent times by cheaper brands being imported from Asia. For Fisher and Paykel (F&P), new attention had been given to the United States, where the DishDrawer dishwasher had sold 110,000 units over three years and overall sales had increased 42 percent in the second half of 2003. The United States market now provided 20 percent of their revenues.

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Case Description
Business Case Study NoUA-2004-002
Number of Pages14
CategoryDecision point; Teaching case
CompanyFisher and Paykel Appliances
Setting - CountryInternational
Setting - CityAuckland
IndustryManufacturing

Source
SourceAuckland, NZ. Publisher: University of Auckland Business Case Centre. Pages: 1 - 15