Retail push revs up sales
STURGEON BAY, Wis. - When Mike Tracey says he's going to build a bigger retail business, he means he's going to build a bigger retail business.
The HME manager of Bay Pharmacy just happens to be a carpenter. He recently spent several Sundays building new retail displays for his 3,000-square-foot retail showroom.
"We're finding some huge success in retail," said Tracey. "The business is growing but dollars are shrinking so we had to do something."
Tracey said retail sales have grown from 1% to about 30% of the business in the five-and-a-half years since he came onboard. He predicts HME revenues to pass $1.5 million this year, a 600% increase.
Bay Pharmacy offers a full line of DME, including ADLs; scooters, walkers and wheelchairs; diabetic, ostomy and mastectomy supplies; and respiratory products, like CPAP and oxygen. The retail showroom shares space with a wellness center and the pharmacy, which fills 500 to 600 prescriptions a day.
"It's a matter of directing traffic," said Tracey. "Our typical customers are adults shopping for parents and looking for things that make life easier."
Bay Pharmacy pulls in customers with a ramped up advertising program that includes two different TV commercials that run 12 times a day. Being in a small market keeps advertising costs down, said Tracey, but he believes advertising at any rate is a worthwhile expense.
"If you spend 10 times as much in bigger markets, you'll get 10 times the business," said Tracey.
Providers can't afford not to advertise, says industry consultant Jack Evans, president of Global Media Marketing in Malibu, Calif.
"Most providers believe advertising is just a luxury," he said. "I tell providers they need to spend 5%, but good ones spend 10% to 15% of gross sales on advertising."
Tracey also hosts a weekly, 15-minute radio talk show. He drums up a topic, often tying it in with various national health months such as heart or diabetes, and provides the on-air radio personality with bullet points to lead him through the show.
"It's $25 a week," said Tracey. "It's amazing. When we talk about something, within an hour, we have people asking about it."