A step in a new direction

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Tuesday, September 30, 2003

MARIETTA, Ga. - With two new franchise stores having come on line this summer, and dozens more scheduled to be in place by year’s end, Foot Solutions is steadily making a name for itself in the specialty footwear market.

The franchise, which began in April 2001, currently counts 80 stores throughout the United States and Canada, and President Ray Margiano expects another 59 to come on line this year.

A key portion of the company’s business, Margiano said, is related to the diabetic footwear category. Sales of these products can account for 25% of a store’s annual sales, which range from $400,000 to $1 million.

About 80% of a location’s diabetic shoe business is billed to Medicare, he said.

It’s no surprise the market for diabetic footwear is helping to fuel Foot Solution’s growth. Roughly 15.7 million people or 5.9% of the U.S. population have diabetes, and each day approximately 2,200 people are diagnosed with the disease, according to the American Diabetes Association.

Franchisee J. Scott Garmon is targeting the diabetes market. Garmon opened his first Foot Solutions in Charlotte, N.C., in July 2001 - it was the 12th in the chain - and launched a second site in Hickory, N.C., in June.

Diabetes and Medicare-related sales account for 25% to 30% of his business.

In contrast, Gary Gramkow, who began in April 2001 with a store in Encinitas, Calif., and opened another in Rancho Bernardo in June, said about 10% to 15% of his business derives from diabetic footwear.

However, he said, the potential for diabetes-related business is there and can be enhanced through customer education.

“A lot of people on Medicare don’t even realize they are eligible for orthotics or diabetic footwear,” Gramkow said.

To address the issue that CMS may eventually restrict who can sell diabetic footwear (HME News 8/2003), Margiano recommends franchisees have a certified pedorthist on staff within a year. Foot Solutions offers the 120-hours of training necessary to become a certified pedorthist, along with its mandatory two-week training program on the ins and out of running a franchise and fitting shoes properly.

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