Armscare: Out of the closet and into retail

Thursday, May 19, 2011

KITTANNING, Pa. - Moving out of a hospital closet and into a visible retail space has really paid off for one provider. 

Last October, ArmsCare moved into an 800-square foot location in a high-traffic area close to the hospital. Several months later, the provider is doing between $130,000 and $140,000 in cash sales every month.

That's no accident, said Jesse Riggleman, director ArmsCare. It took a lot of effort to shift the company's focus and retrain his staff--and himself--to think in terms of "customers" rather than "patients."

"We're not just insurance-takers anymore," said Riggleman. 

Riggleman began to consider the retail model five years ago in the face of looming changes in private insurance and Medicare.

The increase in retail sales has reduced the company's dependence on Medicare from 70% of its sales five years ago to 11% today.

"This is the future," said Riggleman. "Insurance is not what it was in the past. Nobody is going to be able to rely on Medicare. How are you going to survive?"

Riggleman's got the right idea, said retail consultant Jack Evans, who helped Riggleman with the transition into retail.

"You have to diversify your revenue streams," said Evans, president of Malibu, Calif.-based Global Media Marketing. "Government entitlement programs are history. The government can't afford Medicare or Social Security anymore."

Luckily, baby boomers are willing to pay cash for medical products, including nontraditional HME like a "grabber" tool and lights that treat seasonal affective disorder, said Riggleman.

"Those are extra sells that we wouldn't have without the retail store," he said.