HME Retail Sales

HME Retail Avengers

Don your cape and don't be afraid to take the leap from retail novice to cash sales superhero status.

HME Retail Cash SalesHME providers are undergoing a radical transformation. As declining Medicare reimbursement crushes their bottom line like a super villain’s trap, many providers are harnessing retail sales to give their bottom lines a super-powered shot of newfound revenue. And as a result their business strategies are morphing in new and unexpected ways. And those missions are in sync with the marketplace — there are many reasons for providers to be excited about implementing a retail strategy, including a growing customer base from an aging population that is paying cash for products and services to meet their own healthcare needs.

But being a successful HME provider retailer in a traditional and challenging reimbursement industry takes a herculean effort to go from basic retail to creating a model that brings in a significant portion of revenue. Even so, with a growing market segment, more providers are setting out on this path.

“In the last few months, we received incrementally more inquiries from members asking about retail, asking us to visit to help them set up retail and looking for the road map to start and implement retail,” said Rob Baumhover, director of retail for VGM Retail Services. “In addition, there is a trend toward high traffic, stand-alone cash locations, separate from the original DME business. But typically what providers have done is to start slowly, adding retail in response to customers asking for specific items or carrying items in the main traditional categories like bath safety.”

Todd Blockinger, senior director of sales for The MED Group says his organization is also seeing an increasing number of members either looking at starting retail operations or adding resources to their current retail efforts.

“Companies are looking at the demographics of the U.S. population and the current state of health care in general,” he adds. “The take away is that an increasing number of people are in need of retail medical equipment, and are willing to pay cash, foregoing insurance requirements and activities.”

What’s Hot and Why

Understanding the motivations of the customer is paramount to increasing sales. Blockinger reported that The MED Group is seeing a substantial growth in sales of lift chairs and power mobility.

“Patients and their families are focusing on enhanced patient care,” he explains. “Because of this, products that improve comfort, convenience and quality of life are key drivers in the growth of retail sales.”

Randy Walsh, vice president of Jazzy and retail mobility sales for Pride Mobility Products, adds, “The travel mobility product class of scooters continues as a huge retail epicenter for consumers, as do lift chairs. Both of these product classes tie so obviously into quality-of-life, at retail price points within the realm of consumer goods, that consumers are drawn to them. Additionally, related products to core mobility, such as vehicle lifts and personal lifts, are always increasing in retail sales. And, with more and more retirees remaining active in golf communities and such, we see a trend toward larger, high-performance scooters as modes of community-use mobility.”

Taking the Leap

But retail isn’t a slam-dunk. Providers must prepare for obstacles and new learning curves. The biggest retail challenge holding providers back from being cash sales superheroes is a lack of a business plan, according to Maria Claire Markusen, director of development and [operations of VGM Retail Services. Too many retailers buy products, place them on the showroom floor and simply hope for the best. To grow retail revenue, you need a roadmap that gets you from the basics to superhero status. And although business planning will vary by provider, Markusen offers the following steps to help in creating a basic plan:

  • Identify a retail champion for the organization.
  • Analyze your current customer base and respond to missing needs and opportunities.
  • Analyze your market demographics and respond to missing needs and opportunities.
  • Analyze your competition and fill in what they are missing.
  • Define the number of daily transactions at what amount is needed to make a profit.
  • Create a budget to include revenue projections, and operational and startup expenses.
  • Create and manage an 18-month marketing plan to drive traffic.
  • Analyze performance daily and adjust as necessary.

Once you know how you are going to take your retail business where you want it to go, you have to take your employees along for the ride.

“Some providers still think the person walking in the door will have a prescription for a particular product,” Pride’s Walsh says. “Retail providers need to change this mindset and look at that person as a retail selling opportunity.

“Providers shouldn’t overlook the opportunity to incentivize sales staff by offering a commission on cash products and accessory sales,” he adds. “Many providers have a preconceived notion of what they feel a consumer will spend. Providers need to change their funding mind set to a cash purchase mind set, and recognize that consumers are willing to pay for products that will allow them to age at home.”

This article originally appeared in the August 2015 issue of HME Business.

About the Author

Joseph Duffy is a freelance writer and marketing consultant, and a regular contributor to HME Business and DME Pharmacy. He can be reached via e-mail at

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