Scooter Store: 'Whatever is going on is not good for our industry'
NEW BRAUNFELS, Texas – What’s behind all the recent changes at The Scooter Store?
So far, the company, one of two top providers of power wheelchairs in the country, has been tight-lipped. Mark Leita, vice president of external relations and government affairs, provided the same statement to HME News that he provided to The San Antonio Express-News. The newspaper in May reported several top execs had left the company.
"The Scooter Store is taking efforts to streamline the executive leadership team as part of an ongoing effort to position the company to better meet current and future changes," he stated. "The company wants to create a stable business and work environment while driving growth and increasing the value of the company for shareholders."
The exodus at The Scooter Store began in January with Mike Pfister, chief sales officer. He was followed by founder and CEO Doug Harrison in March and numerous others in May.
Whether or not Sun Capital, a private equity firm that sunk $25 million into The Scooter Store last June, is driving the changes is still unclear. It declined to comment for this story.
What is clear: The changes at The Scooter Store follow one of the biggest changes to how Medicare pays for power wheelchairs. The agency used to pay for power wheelchairs in full in the first month; now it pays for them over 13 months.
That has spelled cash flow issues for all providers, from The Scooter Store on down. Rather than cut spending on advertising, which helps The Scooter Store maintain its market share, the company may be focusing on its overhead, industry sources say.
“I don’t know if The Scooter Store tends to be top-heavy, but if they are, that’s something you could afford back in the day, but you can’t afford it now,” said Rick Perrotta, president of Network Medical Supply, a power wheelchair provider in Charlotte, N.C.
Hoveround, the other top provider of power wheelchairs, may have the most to gain from The Scooter Store’s difficulties. But CEO Tom Kruse says the HME industry is better off with, not without, The Scooter Store.
“A large company like that getting hurt or going down—whatever is going on is not good for our industry,” he said. “Quite frankly, the market is down and utilization is off tremendously. Everybody’s just trying to survive and hold their own.” HME