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Sennheiser creates consumer electronics subsidiary

test 21 August 2007

GERMANY: Sennheiser is establishing a new consumer electronics subsidary to focus exclusively on headphones. Sennheiser Consumer Electronics, which is expected to be up and running during the next two months, is intended to help the company identify trends at an early stage and cope with the “very short product life cycles” that now characterise the consumer market, writes David Davies.

The new subsidiary is split between operations in Ireland and Singapore. The former – where transducer manufacturing, assembly of Sennheiser’s high-performance headphones and “worldwide fulfilment” is based – is to be headed up by managing director Peter Callan. The Singapore branch is focusing on product marketing and will be overseen by MD Stijn Jans. Both executives will report directly to the Executive Team at Sennheiser’s head office.

The decision to locate half of the new subsidiary in Singapore appears to be particularly significant. “Over the last couple of years the centre of innovation for the consumer industry has changed,” Volker Bartels – president, manufacturing and logistics, and speaker for Sennheiser’s Executive Team – tells PSN-e. “It used to be in Europe, then it moved to Asia, and now increasingly it’s in Asia. So that’s why we located [part of the subsidiary] in Singapore – it’s a perfect blend of Western and Asian culture.”

Collectively, the two bases will allow the company to respond to a consumer industry that is generally operating to two-year product timespans, and in which consumer tastes and desires are changing at an evermore rapid rate.

“Behaviour-wise, a lot of the industry is moving towards having similar structures to the automotive industry – just-in-time delivery and so on,” says Bartels. “With a short fashion cycle, customers move through very short lead order times, and of course they don’t want high stock loads in their inventory – nobody does. We need to come up with processes that allow us to react in a very short time without putting much stock in our warehouse, too.”

Product-wise, the new subsidiary will initially concentrate on headphones suitable for ‘music on the move’. “We’re talking about earbuds, small earphones, small units in ear canals – not so much the big ones for home use. It’s the small headphone products that the new unit will be focusing on first.”

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