Koss Corporation
As used herein unless the context otherwise requires, the term “Company”
means Koss Corporation and its subsidiary, Koss U.K. Limited. The Company formed
Koss U.K. Limited to comply with certain European Union ("EU") requirements.
The entity is non-operating and holds no assets. The Company was incorporated
in Delaware in 1971.
The Company operates in the audio/video industry segment of the home entertainment
industry through its design, manufacture and sale of stereo headphones and related
accessory products. The Company reports its results as a single reporting segment,
as the Company’s principal business line is the design, manufacture and
sale of stereo headphones and related accessories.
The Company’s products are sold through national retailers, U.S. distributors,
international distributors, audio specialty stores, the internet, direct mail
catalogs, regional department store chains, discount department stores, grocery
stores, electronics retailers, military exchanges and prisons under the “Koss”
name. The Company also sells products to distributors for resale to school systems,
and directly to other manufacturers for inclusion with their own products. The
Company has more than 200 domestic dealers and its products are carried in approximately
16,000 domestic retail outlets and numerous retailers worldwide. International
markets are served by domestic sales representatives and sales offices in the
Netherlands and Russia. The Company utilizes independent distributors in several
foreign countries.
Approximately 83% of the Company’s sales were from stereo headphones
used for listening to music. The remaining 17% of the Company's sales were from
headphones used in communications, education settings, and in conjunction with
metal detectors. The products are not significantly differentiated by their
retail sales channel or application with the exception of products sold to school
systems and prisons. There are no other product line differentiations other
than the quality of the sound produced by the stereo headphone itself, which
is highly subjective.
The Company sources complete stereo headphones manufactured to its specifications
from various manufacturers in Asia as well as raw materials used to produce
stereo headphones at its plant in Milwaukee, Wisconsin. Management believes
that it has sources of complete stereo headphones and raw materials that are
adequate for its needs.
There are no employment or compensation commitments between the Company and
its dealers. The Company has several independent manufacturers’ representatives
as part of its distribution efforts. The Company typically signs one year contracts
with these manufacturers’ representatives. The arrangements with foreign
distributors do not contemplate that the Company pays any compensation other
than any profit the distributors make upon their sale of the Company’s
products.
17.99%