Must-have categories and products that help ensure cash sales success.
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Courtesy of March 2017 HME Business
Outlining a solid retail sale strategy can pose a tricky challenge. Providers know that retail sales are essential in helping diversify revenues in the face of reimbursement cuts, but determining which categories are right for a providers’ business, and how to sell those products isn’t exactly easy.
In aggregate, the percentage of HME provider revenue that comes from cash sales is difficult to measure, but Maria Markusen, director of development for VGM Retail, says that the number of VGM members contacting the organization to discuss how to implement retail has at least tripled since the beginning of this year.
Markusen notes that generally, those HME providers who have implemented cash sale strategies have seen some measure of success but many providers have not had enough time to move beyond the ramp up to obtain results.
“Those folks who are successful also implemented an inventory and product management plan and a focused marketing plan to propel them into success,” she explains.
According to Kamal Haddad, founder and CEO of HME e-commerce company Health Mobius LLC, many HME providers should be generating more than 30 percent of their revenue from retail cash sales.
“If they are not,” he says, “they should be asking, ‘Why am I not?’ and ‘How can I?’ Just about every funded item has an alternative premium upgrade choice. They also have a number of accessories or complementary items that are used in combination. It’s easy to display the accessories in-store even when the inventory is not onsite by placing the order on your company e-commerce website and having it drop shipped direct to the patient.”
If anything, tapping into top-performing retail categories could be the smartest approach for providers. If they pursue known top sellers, they should be able to get closer to the the 30 percent that Haddad highlights. To dig deeper, HME Business magazine asked a panel of retail experts to discuss must-have retail categories and products and ways they can help you grow your bottom line.
Category: If you want to beat Amazon at its own game in the cash sales market, become an expert in the following product categories. When you do, you’ll run circles around impersonal, off-shored support teams who don’t understand your customers: Aids to daily living, support surfaces, mobility products, nutritional supplements, disposable supplies, including Incontinence, personal care and sleep comfort aids.
Strategy: At Cure Medical, we have found that insurance may not pay for the entire month’s usage of catheters for those who rely on them. Some end users surpass the 200 per month allowable cap on intermittent catheters, so they fill in the gap by paying cash for extras. Also, they may prefer specialty products, like closed systems when traveling or pocket catheters when playing sports.
If these items fall outside of their approved items, they’ll be willing to pay cash for the convenience.
Adult diapers are generally cash pay, too, so if you aren’t offering these to your existing catheter users, you are missing an opportunity to generate a new line of recurring monthly cash flow for your business.
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