Orthotics Company Regaining Its Competitive Edge

In 1992, Karen Bonn left behind a nursing career to start a company that manufactures restorative splints and braces in Brandenburg, Ky. She began Restorative Medical in her basement and funded the business with her husband’s retirement savings and a second mortgage on her home.

“While working as a director of nursing in a long-term care facility, I was disheartened at the limited and inappropriate selection of orthotics available for restorative type patients,” she recalled. “While most of the medical community still thought these types of disabilities were inevitable and not able to be corrected, I decided to design my own braces.”

Orthotics are custom-made appliances that stabilize and protect fragile joints and can also keep a joint properly aligned to improve functioning. The splints and braces that Restorative Medical manufactures treat patients who, due to illness or injury, are unable to relax their muscles. Although the organelles in the muscle tissue are still active, the relaxation message is not received from the brain and the body ends up in a hyper extensive mode, twisted and deformed.

As president and CEO of the eight-employee company, Bonn said that she often relied on word of mouth to market the company’s products. Such success can be short-lived when competing in the global marketplace.

“We’re trying to figure out how to make an impact on the world, and we struggle,” she admitted. “Our biggest competitor, a firm in Costa Rica, cut its price to the absolute bottom, so we had to lower our price and fight very hard to stay in business.”

To address some of her concerns, Bonn began working with specialists from the Southeastern Trade Adjustment Assistance Center (SETAAC), based at Georgia Tech’s Enterprise Innovation Institute in Atlanta. Serving the eight-state region of Alabama, Florida, Georgia, Kentucky, Mississippi, North Carolina, South Carolina and Tennessee, SETAAC helps manufacturers develop and implement turn-around strategies to better compete with imports.

“If a company’s sales and employment are down as a result of imports, it probably qualifies for the program,” said project manager Mark Hannah. “We conducted an initial review of Restorative Medical, and helped them prepare an application for the U.S. Department of Commerce. Once they were approved for the first level of funding, we developed a diagnostic and adjustment plan in order to address issues to help the firm improve its competitive position.”

Firms that are accepted into the SETAAC program pay for 25 percent of the diagnostic visit and report. The government generally pays half of the cost of project implementation for activities to benefit the company. Following the diagnostic and adjustment plan, Hannah had private sector consultants submit quotes for implementing the identified projects. Bonn then selected the consultant and together they implemented the changes.

Typically, companies that are involved in the SETAAC program receive assistance in marketing consulting, manufacturing improvements, information systems improvements, employee training and maintenance and quality systems improvements. SETAAC helped Restorative Medical with developing a DVD that could be used for marketing purposes and for training nursing home and health care personnel.

“The DVD will be an awesome thing for the future of our company and our marketing efforts,” noted Bonn. “The ultimate goal is to send the DVD for training purposes instead of having to get on a plane to explain the products to someone.”

Another area in which Restorative Medical received assistance was the patent of a new product, Hyper Hands. This brace helps to treat typical conditions like neurological tone, arthritis and ulnar drift, in which the fingers all bend toward one side of the hand. Bonn said the assistance she received from SETAAC was critical.

“We could not have afforded to submit a patent for a new product without the assistance of SETAAC,” she said. “Our representative was wonderful to keep in touch, aware of deadlines and very organized.”

Bonn said she expects additional jobs to be created in the future, once sales have taken off from the company’s marketing efforts. Currently, she is applying for the next phase of funding available through the SETAAC program.

Last year, SETAAC helped more than 30 companies. On average, these companies received $42,000 in matching funds. In the last three years, SETAAC’s overall client base has increased sales by 26 percent and improved productivity by 28 percent.

About the Enterprise Innovation Institute:
The Georgia Tech Enterprise Innovation Institute helps companies, entrepreneurs, economic developers and communities improve their competitiveness through the application of science, technology and innovation. It is one of the most comprehensive university-based programs of business and industry assistance, technology commercialization and economic development in the nation.

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Media Relations Contact: John Toon (404-894-6986); E-mail (john.toon@innovate.gatech.edu).
Writer: Nancy Fullbright