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Hearing Instruments<br />
via Denmark<br />
<strong>GN</strong> is relocating its global distribution center for hearing instruments to Denmark. The move will be a big challenge,<br />
but careful planning and training will make it easier to complete the process.<br />
SUPPLY CHAIN<br />
More Products from China<br />
MANUFACTURING<br />
<strong>GN</strong> is relocating the<br />
last of its BTE production<br />
to the factory<br />
in Xiamen, consolidating<br />
all BTE production<br />
in China.<br />
8<br />
<strong>GN</strong> Magazine 1 l 06<br />
The fi rst people to work at <strong>GN</strong>’s new headquarters in<br />
Ballerup west of Copenhagen moved in at the beginning<br />
of <strong>March</strong>: the staff manning the global distribution center<br />
for hearing instruments. Construction workers have<br />
worked hard for months to renovate the warehousing<br />
facilities, setting up shelving to hold many small hearing<br />
instruments. The warehouse brings back memories<br />
for several “old” employees: it’s almost an exact copy<br />
Until now, about one-fi fth of <strong>GN</strong>’s BTE hearing instruments<br />
have been manufactured at the factory in Cork,<br />
Ireland and the rest at the Xiamen factory in China. Now<br />
<strong>GN</strong> is moving all manufacturing to China. Combined<br />
with the relocation of the Global Distribution Center this<br />
will result in annual savings of DKK 40 million. While the<br />
relocation means that some products will need to be sent<br />
on longer trips than before, transport costs represent<br />
such a small share of overall costs that the difference<br />
is easily outweighed by the lower production costs in<br />
China.<br />
A 15% Increase<br />
For the Xiamen factory, the relocation will mean a 15%<br />
increase of the BTE device output capacity. <strong>GN</strong> will fi ll<br />
the gap by hiring new staff, so the factory will still be<br />
capable of increasing output capacity through shift work<br />
and expansion.<br />
of <strong>GN</strong>’s current distribution center in Cork, Ireland. That<br />
facility is now being relocated to Copenhagen in connection<br />
with the shutdown of production in Cork.<br />
Like Moving a Half-Timbered House<br />
Each individual item at the warehouse in Ireland has<br />
been marked by location to ensure that it ends up in the<br />
same place in the new Danish warehouse. More than<br />
Experienced China<br />
Most of the products currently being manufactured in<br />
Ireland are also being manufactured in China.<br />
“We have experience in manufacturing many of the<br />
products that have recently been produced in Ireland. To<br />
date, some of the selected product colors have only been<br />
produced in Ireland, so here in China we will be adding<br />
more colors to our existing product lines. We will also be<br />
taking over the production of the spare parts previously<br />
produced in the factory in Ireland,” says Ken Fay, the general<br />
manager of <strong>GN</strong> ReSound’s factory in China.<br />
Overall, the factory in China will be manufacturing<br />
an additional 16,000 hearing instruments per month. A<br />
number of employees from production and the production<br />
planning and procurement staff from China have<br />
either recently visited or are in Ireland at this time being<br />
trained by Irish personnel.<br />
Fay expects the Chinese factory to take over all production<br />
from Ireland by the end of April.
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