Lessons Learned:
Selling Medical Devices Abroad

Lloyd Cartwright, who invented the minted toothpick, started Hardwood Products Co., LP in 1919 to manufacture woodenware for the food industry made from Northern White Birch. Over the years, the family-owned business has produced everything from ice cream sticks to skewers. But in recent years, Puritan Medical Products Company, LLC, a division of Hardwood Products, has concentrated on its niche market in the diagnostic industry, providing sterilized swabs for DNA testing, anthrax detection and food safety.

The company’s ability to diversify into different markets emerged early. It decided to get out of the minted toothpick business in the mid-1950s and broaden its product line in the 1960s by manufacturing sterile swabs for the medical device market. While Hardwood continues to sell wooden items for the food industry, it’s the medical devices segment of the business that has grown and has the potential for more growth domestically and abroad, said Timothy Templet, executive vice president of global sales and marketing.
Puritan Medical Products has succeeded in producing highly specialized diagnostic swabs, tailoring them to exacting customer specifications. “We have the ability to mold wooden applicator sticks to a plus or minus of .003 inches,” or the thickness of three hairs, Templet said.

Hardwood Products, which employs 300 people, including a fourth-generation family member, has “a work force that is very conscientious about what they do every day,” said Templet, who is the grandson of Lloyd Cartwright. “We have creative engineers who can take existing equipment and turn it into something different because a customer requests something different.”

That ability and willingness to “do whatever it takes to make the customers happy” has helped the company’s work in the diagnostic field grow as exports in other portions of the business, including food industry products, have remained stagnant.
There are numerous companies, both domestically and abroad, manufacturing food industry products such as flag sticks and utensils. But fewer American competitors have invested in the technology and achieved the quality control standards needed to export diagnostic products to some foreign markets. The company has been certified by the International Standards Organization and the British Standards Institute; it has earned the CE mark of European Conformance, and is registered with the Food and Drug Administration’s drug division.

“One of the ways they continue to adapt their product is through constant innovation,” said Andrew MacDonald, international trade specialist with the Maine International Trade Center. “Re-investment and a commitment to research and development have been keys to success for Hardwood Products.”

The investments have paid off. In the past 18 months, the company has exported its medical devices to 42 countries across Asia, Europe and Latin America as the medical industry worldwide has become more high tech, creating ever more demand for diagnostic tools.
But while exports are healthy now, Hardwood’s experience selling overseas hasn’t been as smooth as its wood. Several years ago, when the medical products division began exporting to Europe, it relied on a New York-based commissioned sales representative. When the rep died six years ago, Templet said, company executives discovered how much they had depended upon him. They decided they needed someone in-house to travel and learn about other cultures and potential markets.

Templet packed his bags. In the past few years, he has traveled abroad about two weeks a year, and this year, exports have accounted for 5 percent of Hardwood’s business. His goal is to double that in 2003.

To help him reach that goal, the company has hired someone else to take over the U.S-based sales in the medical and industrial market. Templet will focus on exports, traveling overseas about four weeks a year to build connections. .
“My future at Hardwood is to cultivate those relationships,” he said. There’s no substitute for face time. “It never happens on the first time. It happens on the fourth time. They have to trust you.”

Earning that trust isn’t easy, especially with cultural differences and language barriers, he said. Although he has been involved with exports for six years, he says he is still learning. Each country does business differently, so exporters have to adapt.
The U.S. Department of Commerce has provided a wealth of information, at no cost, Templet said, and joining the Maine International Trade Association was well worth the cost of the annual dues. The trade association helps businesses navigate the duties and regulations unique to each country. But even with these agencies’ help, his firm made a mistake recently he wouldn’t wish on anyone.

A foreign company requested a quotation on the price of 200,000 medical devices. (Templet asked that the specifics of the country and the medical device be kept private.) Partly because of the language barrier, Hardwood employees thought it was an order to buy, not a request for pricing. Hardwood further thought the request was for 2 million, not 200,000, Templet said.

Throughout the process, the customer knew that Hardwood was manufacturing 2 million, but never corrected Hardwood’s error. They discussed packaging. The paperwork was completed. The order was shipped, all 2 million devices. That’s when the customer told Hardwood it only wanted 200,000. After several months of negotiation, the customer agreed to pay for 200,000 but kept the 2 million.

This was a distributor Hardwood had courted for months with the expectation of forming a partnership, Templet said.

“I promised that I would never do business with them again,” he said.
As a result of that experience, Hardwood’s Puritan Medical Products Company LLC designated an export team of three people—Templet, a sales manager and an administrative assistant—to oversee orders from the initial inquiry until shipment. Fine details are scrutinized, and translations between languages are double checked for accuracy. The administrative assistant is taking French and Spanish lessons; if she doesn’t understand something, the company hires an interpreter.

“It would be my advice that one person in the organization understands exactly what the customer needs, what the order is and how they want it shipped,” he said. “One person should know it all, rather than breaking it up.”