It is not one of Barbados’ best kept secrets. From Christ Church, Barbados to Beijing, China, the world knows that a highly-acclaimed producer of implantable lenses is based on this island.
But what might still be unknown to some, is the extent to which Lenstec (Barbados) Inc., has penetrated the international market for these medical devices.
An even bigger mystery probably is the fact that despite generating $40 million in annual sales, this local manufacturer “still can’t get bank investment”.
President Ian Hickling shared this perspective of the operation with BARBADOS BUSINESS AUTHORITY last week as he left the island to attend “one of the big three” international ophthalmology conventions in Boston, Massachusetts.
Reporting on current happenings at the business which has operated here since 1996 and exports to more than 50 markets, he said Lenstec had “just opened distributorships in Sweden and New Zealand and are negotiating a series of them in the Middle East (Morocco, Egypt, Yemen, and Saudi Arabia)”.
This follows a two-year period of fluctuating business where sales grew then tapered off.
He said 2012 showed a dramatic increase mainly because of major growth in US and China markets. “Our sales had increased 37 per cent that year, and so we took the early part of 2013 to put on additional staff and generally grow our production capacity to meet the demands.
This we achieved, and we needed to because we expected 2013 to also show major growth. However, there was no further growth in 2013, and sales for 2013 were much the same as 2012,” he reported.
“[Last year] therefore gave us an opportunity to catch up with production that was outstripped in 2012, and our inventory now looks very good. At the end of 2013 we were looking just right for expected sales in 2014. It has been difficult to assess what would happen in 2014, but we have taken another in our constant strategic looks at the business, and made adjustments.
“This is an ongoing process – you have to constantly be aware of the market, your customers, your competitors and your research and development pipeline. So far our 2014 sales are slightly ahead of the same time last year, so we are generally pleased. However, as always, the big picture covers over the details, and that’s what we have to keep on top of,” he added.
Hickling pointed to “consolidation into our main markets with some of our smaller markets under-performing”. This prompted the company to take “some actions to correct this”, including the appointment of a regional sales manager for Europe, a market where “a general decline over the past three years” was noticed.
He attributed this to several factors including “governments putting less money into healthcare, increased competition from Indian manufacturers, and the rise in “hydrophobic” lens sales in contrast to our “hydrophilic” ones.
“Our European manager is charged with rejuvenating our European sales by appointing and supporting a network of distributors in European countries. This has already proven effective with us now being represented in Scandinavia, where we have never been before,” he said.
Notwithstanding the challenges which they have encountered in the last two years, Hickling and other Lenstec team members are poised for growth and have been taking steps to ensure they attain it, including developing new products and developing the Chinese and United States market.
“We have invested heavily in developing a pre-loaded lens delivery system over the past five years and this has now been introduced to some key markets, including the US and Europe. Also, we have developed a unique bifocal lens that appears to give unprecedented visual results for distance and near vision. This lens looks likely to grow our sales over the next three years,” he said.
“We also made the strategic decision to get this lens registered in the United States, and that is a process that takes at least three years and costs several million dollars. Therefore our product planning decisions tend to have quite long time horizons. Once we get US approval for this lens, we expect another large increase in sales revenue, but you can see it will have required many millions of dollars of investment to get that registration.”
Hickling also saw “some major growth opportunities in the near future”, saying the company saw the Chinese market growing by up to 15 per cent in the next ten years, adding that Lenstec would be having “key discussions that will inform our strategic planning in coming years”.
A major concern for him, however, was Lenstec’s continued inability to get finance from local banks.
“If we were based in the US, for example, this would be easy. However, banks in Barbados are . . . . conservative in their approach and therefore all our development and growth has to be funded from private investment,” he said.
“In practice this means that all our research and development of new products and regulatory approvals in countries has to be funded out of our own sales. That constrains how quickly the company can grow. The fact that we have grown to the size we are in only 17 years is down totally to the fact that we put all our sales money into developing the company and its product range. We don’t see this changing in the near future.”