Embrace your inner David

Wednesday, December 31, 2008

In our January HME NewsPoll, we asked providers what they thought about manufacturers selling home medical equipment through mass retailers (See poll results on page 38). We figured this was an appropriate and timely question, considering the rumors swirling around Respironics and its alleged plan to do just that.

Not surprisingly, a majority of providers (81% of 183 respondents) have a problem with manufacturers selling through mass retailers. In comment after comment, providers pointed out that mass retailers fall short on expertise (their employee turnover is very high) and service (they focus almost exclusively on moving products). The result: Consumers don’t always get what they need.

Few would argue with that. I know if I go to Walmart to buy a flat-screen TV, I better have done my homework on what to buy; I better have a truck to haul it home; and I better know the name of a local repair shop, in case it goes on the fritz. That’s probably not the case if I go to David Munster’s TV in Portland, Maine, where they’ve been selling and servicing TVs for more than 35 years.

Still, day in and day out, people, including me, go to mass retailers to buy electronics. The reason is simple: It’s often more convenient and it’s almost always cheaper.

Frankly, I’m surprised home medical equipment has escaped this trend as long as it has, especially for less complex devices. Walmart stocks some commodes and crutches, but not much else.

Providers know that’s going to change. In our poll, we also asked whether providers thought mass retailers would sell more home medical equipment in the next 10 to 15 years; 82% believe they will.

So, while providers don’t like manufacturers to sell through mass retailers, most believe this trend will grow. OK. Now what?

Some providers who responded to the poll threatened to stop doing business with manufacturers that sell through mass retailers. This isn’t realistic (manufacturers are allies, but they’re businesses, too). At the end of the day, it amounts to nothing but pouting and foot stomping.

Others, however, sounded the voice of reason.

One respondent commented: “Free markets dictate that if Mass Mart can buy and sell DME, they should be able to. My job is to offer more than just the box, and if I can compete on the level of service, I should get market share.”

Another respondent: “I think that there is nothing we can do to stop mass retailers from selling HME, so we have to figure out how we can make people want to come to us instead.”

Providers may have some time to get used to the idea of mass retailers selling more home medical equipment. We asked manufacturers if they currently sell home medical equipment through mass retailers and only 25% say they do.

Regardless, for the sake of being prepared, here’s a New Year’s resolution for you: By now, you should be used to being the David in David vs. Goliath, so maybe it’s time you embraced it. Have no shame in being a small company where, although prices may be a little higher (for retail items, anyway), consumers benefit from your expertise and service.

With any luck, home medical equipment will get swept up in another trend: the buy local movement.