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Align Technology

In: Business and Management

Submitted By lvp93d
Words 393
Pages 2
Align Technology, Inc. is a medical device company who pratices the design, manufacture and marketing of Invisalign, the world’s leading invisible orthodontic product. Invisalign is a series of clear, removable aligners that both orthodontists and general dentists use to straighten their patients’ teeth. By aquiring the precise virtual image of a patient’s teeth, manipulating this image of the teeth in prescribed increments, creating positives of these positions, and then manufacturing thin plastic, invisible negatives of the teeth at each stage of the treatment, the company offered clear, removable appliances that effectively straightened a patient’s teeth. With more than twenty million unique aligners made to date, Align is one of the largest manufacturers of mass customized products in the world. However, the company was still far from profitable, and its technology had not yet been widely accepted as the treatment of choice by orthodontists. The problem being that the demand for Align’s product fell short of its manufacturing capacity and therefore, the company was not meeting its financial targets. With an average selling price of $1,600 per case at an average cost of $1,800 the company would never reach its targeted 50% gross margins by the end of the year (Bowen, p.1).
Align is operating under a customizable made to order strategy, while maintaining 20% above demand excess. Align needs to find the correct mixture of demand and supply within its own manufacturing process.

Challenge

The challenge for Align is that their sales demand is not as high as they had originally forecasted. As a result Align is overproducing their product, thus losing profits. The company sees the potential for growth however, Align is currently over producing a product at tremendous cost with few orders coming in. The problem is Align’s capacity is too high and has to be...

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