Zimmer Has to Reduce the Size of Its Portfolio, CEO Says

Zimmer Biomet is making progress toward the company's supply recovery goals, but CEO Bryan Hanson says he is still not happy with where the company is at.  "The fact is, we need to continue to focus on bringing up our service levels to our customers. We need to be best-in-class in this area," Hanson said during the company's third-quarter earnings call, as transcribed by SeekingAlpha.  While Zimmer Biomet's portfolio is "absolutely unmatched" in terms of scale, Hanson said the size of the portfolio creates a very complex supply chain for the company. Reductions won't happen right away because the company still has to focus on its short-term priorities, but he said the number of stock keeping units (SKUs) attached to Zimmer Biomet's product families is "extremely cumbersome." Trimming the portfolio will not only help service levels, Hanson said, it also will have a peripheral impact on other financial benefits and efficiencies for the organization. But the company also has to be cautious about how fast it pursues that portfolio reduction.  "The worst thing we can do right now when we have been stressing our surgeon partners because of the supply issue is the start taking away products they know and love," he said. "And so we do have [to] sequence this thing appropriately, get to that place where we feel confident that supply is in good shape, that our field sales organization feels the same way, as well as our surgeon partners. And at that p...
Source: MDDI - Category: Medical Devices Authors: Tags: Business Orthopedics Source Type: news