Products & Technology

Unlocking New Retail Revenue: The Orthopedic Option

About 25 percent of the customers who walk through your door could use an orthopedic OTC product. So what are you doing to make sure people are not waking out without the help they need?

orthopedic retail optionsWhen DME industry experts discuss retail strategies to increase revenue streams among a reimbursement industry, the baby boomers are often the focus of a growing cash sales customer base. With 10,000 people turning 65 every day, the senior generation is active unlike ever before. And if you add sports therapy and rehab patients to the aging population, there is tremendous opportunity to sell orthopedic products that help assuage the aches and pains of active and ageing bones and muscles.

“Transparency Market Research predicts that products which help address pain will grow as America’s boomers age,” said Jim Howle, Senior Director of the Rehab & Orthotics Network, The MED Group/Kadel Laxson and Program Manager, The MED Group. “The federal government also estimates that the out-of-pocket costs for patients will be growing, hitting close to 60 percent by the year 2020. As a retail product that can help address pain, orthotics is almost sure to be part of this growth. Plantar fasciitis night splints, patellofemoral bands for knee pain, wrist splints, and more — these retail items can be purchased over the counter [OTC] and should be part of every retail DME/HMEs offering.”

According to Jim Greatorex, Business Development, VGM Retail Services, and formerly of Maine’s Black Bear Medical, there is a lot of opportunity and growth in the orthopedic soft goods market for those who can market their business correctly.

“Take, for example, the boomer population, many of whom desire to stay as vibrant and active for as long as possible while they age,” he said. “Many are involved in recreational and sports activities and wear orthopedic products in order to comfortably do so. Clearly the demand for these products is high as every sporting goods store, pharmacy and supercenter carry them. The advantage HME providers have in this market is that we can fill prescriptions for these products or offer patients a cash option and guide them to find the product that best suits their needs.”

With more boomers turning to orthopedic products to comfortably maintain their active lifestyles, the product category is getting much more attention than it once did. The unfortunate part, though, is that HME retailers may not be the first place customers think of when looking for these products.

“In the past, the quality of the orthopedic market diminished slightly as the marketplace was pressuring for lower prices,” said Howle. “Recently, we have seen the quality come back up as manufacturers are ‘boomer-izing’ their lines. They’re supplying this new market with quality lines rebranded with positive concepts and eye-catching aesthetics, giving the line a sexier, healthier look.”

Making compression more mainstream

One such orthopedic product category that has become very fashionable is compression therapy garments. Juzo, which has been in the compression business for over 100 years, recently announced its 2015 Spring/Summer collection, which is full of attractive, marketable sleeves and leggings sporting colors such as Driftwood, Moon Beam Yellow and Gypsy Purple. To help sell their stylish offerings, they offer their HME provider customers posters that advertise ‘dressing in style’ and ‘staying active.’ According to Tom Musone, Juzo’s Marketing Director, the compression therapy garment industry has seen a lot of growth over the last several years in both sales and awareness in the medical field and consumer market.

The majority of compression patients sees a doctor or medical professional
about an ailment and is given the directive to obtain a compression
garment from an HME provider. These high-grade compression products
are driven by a professional diagnosis. In addition, there are compression products that can be sold OTC.

According to Musone, compression items that are 20mmHg or less are considered OTC and can be sold without a doctor or medical professional’s recommendation. This category includes support socks, arm sleeves, biker shorts, leggings and more. Musone recommends that HME providers carry these products, along with educational literature, and talk to customers about their needs, regardless of why they came in the store.

“One out of every four people who walk in your door have some degree of venous disease,” said Musone. “So that OTC garment that we supply without a prescription can be sold to that patient. We also help our clients promote OTC products through the marketing tools we offer.”

The easiest way to get into the compression cash sales business is to get in touch with a manufacturer and see what kind of products, support and tools they offer the HME provider. Juzo, for example, will train an HME customer how to fit compression garments and offers online marketing tools and education.

Top patient
Orthopedic cash sales products Comments
Rehab Wrist, ankle, knee, back,
neck, ice packs
Rehab and sports categories
are very close in sales.
Sports Wrist, ankle, knee, ice packs,
back supports, arm slings
The orthopedic market has shifted
to serve more sports-related injuries.
Geriatric Ankle, wrist, immobilizer,
elbow, shoulder
Geriatrics is a very popular product
category when a caretaker is involved
in the purchase.
Post-surgery Abdominal support,
arm slings, knee, ankle
Post-surgery probably relies more on
insurance, since they are dealing
with insurance already.
Maternity Back support  
Weekend Warrior Ice packs, wrist, ankle,
knee, elbow, arm sling
Weekend warriors and accidents are due
to the nature of the injury and patients
may self-treat and go straight to buy a support,
probably at a drug store or pharmacy.
Accidents Ice packs, wrist, back support,
ankle, knee, elbows, arm slings,
cervical collars

Top orthopedic categories

Linda Lavi is the Vice President of Marketing for Alex Orthopedic Inc., a manufacturer of orthopedic soft goods. She said that more and more companies are competing in orthopedic products in the retail space.

“The market has gone from reimbursement to cash sales,” she said. “The patients have more money, and they don’t want to wait until Medicare or insurance pays. And they also want what they want and not one just because it’s reimbursable.”

According to Lavi, here are the top orthopedic patient-type categories responsible for the majority of orthotics sales, the most popular product categories serving these populations, and her various comments about the categories.

By body part, Lavi said the back and knee are the bigger markets for HME providers in both volume and revenue. Then come wrist, ankle and neck. For chain drug stores, the top-selling products are for knee, ankle and wrist.

“The top five body parts that consumers seem to demand are knees, wrists, ankles, backs, and elbows,” said Greatorex. “Other products growing more popular are rib belts, abdominal binders, and cervical collars and shoulders. There is also a large influx of products coming to market for posture support that are actual garments you wear that prompt an upright posture rather than the slouched posture many of us procure when hunched over our work desk or computer monitor.”

Howle suggested that a top retail product is a prophylactic brace or something that addresses pain but has not been prescribed by a physician.

“Anything that ties into sports (knee braces, tennis elbow, etc.), along with braces that help address pain (night splints, wrist splints), are going to be the key categories,” Howle said.

To create more sales, Lavi offered the following:

  • Listen to your customer, and then make recommendations for them.
  • With so many choices on the market, it’s confusing, so help them find the right product. Senior patients will want comfort and something that is easy to apply. The sports and rehab customer will want comfort, but will also want something wearable, movable and durable.
  • Instead of hanging things on a hook without regard to style or size, give your products a uniformed look. Consider color-coding them or organizing to make it easy for the customer to find the product.
  • Carry a complete range of sizes so the customer can be fitted properly.
  • If space is available, separating the more basic, less expensive sports-related products makes it less confusing for customers, and helps them find what they are looking for easier.

“It’s retail,” said Howle, “so talk to the benefits, not the features. End users don’t care if the product has triple laminate — they care if it is strong enough to support them but is also lightweight. If you want to focus on retail, look at lines designed to target those customers. Medline’s Curad and Roscoe’s Viverity product lines are two excellent examples of retail-focused brands. Also, working with clinicians and physicians as a referral source can provide a steady stream of new orthotics patients.”

Howle also pointed out that good merchandizing, such as well-designed space, attractive packaging, and a comprehensive array of products, means having enough product selection to meet the needs of the client who walks in the door.

“The typical HME provider devotes approximately five feet of wall or shelf space to orthotic products, but that space should be increased significantly,” he said. “In true retail fashion, it makes sense for that retail space to be 20 to 30 feet. Education materials for consumers and point-of-sale materials, such as printed brochures and guides, are necessary for both consumers and retail staff.”

A good way for HME providers to work in the orthopedic arena is to first market to the prescribed user — the orthopedic doctors and surgeons and general practice and rehab facilities, said Greatorex. Another exploding category due to the new breast pump coverage guidelines is in the maternity market. Maternity orthopedics should be a part of any mom and baby product category.

“Orthotics are a way to increase retail sales revenue,” said Howle. “Many orthotics are sold as cash products in a retail setting as opposed to going through a billing process. The products are easy to stock and understand, and require no service. HME providers have very low market entry issues when deciding to stock and sell most orthotics. The need is high and continues to grow and the product typically will be needed by many in their customer base, allowing for internal data mining and marketing efforts. The use of programs developed such as the Patient Enhanced Provider Care Program from The MED Group lets HME providers follow a roadmap in providing products such as orthotics. MED Group programs such as these help identify ancillary medical products needed by a providers customer base and drives awareness to those customers that their HME provider provides products such as orthotics.”

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

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