Products & Technology
6 Must-Stock Retail Categories
HME providers and retail experts share their recommendations for top-selling products, and offer their advice and insights on retailing them successfully.
- By Leila McNeill
- Mar 01, 2019
More and more, HME providers are integrating retail sales into their business, as competitive bidding, audits and various other reimbursement challenges compel them to seek new ways to bring in revenue. Tried and true, retail has proved to be a reliable source of alternative revenue for providers. Free of claims processing workflows and possible denials, retail sales offer streamlined cash transactions between provider and customer that don’t involve insurers or Medicare.
However, the increased cash flow opportunity of retail remains only an opportunity if providers don’t strategically stock their retail product inventory and deploy marketing strategies that appeal to customers, both old and new. Simply stocking shelves with any retail products doesn’t guarantee increased sales.
“It’s still very important to consider the local healthcare landscape,” says David Sterns, HME regional manager for William’s Bros. Health Care Pharmacy. “Much of a provider’s business is determined from referral sources surrounding their location. A product category that works for one provider, may not work for another.”
To help providers get an idea of what product categories have the potential to drive revenue and what strategies ensure those categories’ success, HME Business asked several HME retail providers and experts from around the country to offer their recommendations for must-stock retail categories and their best tips of the trade for providing those products successfully.
“In the case of fall prevention in the home, it starts with bath safety,” said Rob Baumhover, VGM Group’s director of Retail Services. “This category offers high demand motivated buyers into your store. Not necessarily high margins, but sheer interest and volume alone, anchor this category firmly.”
Bath safety is critical to ensuring safety and independence for elderly customers and customers with mobility challenges, yet it is not funded. The acute need and high demand for such products, in part, is what drives customers to the store to purchase these items on a retail basis.
Wayne Slavitt is CEO of Mobül, a retail mobility provider in Long Beach, Calif. who says he primarily focuses on mobility-specific products, but he finds value in stocking bath safety products because issues of mobility and bath safety are strongly connected.
“When people start to have mobility issues, the first thing they’re typically trying to address would be something dealing with the bathroom,” Slavitt explains. “They’ll come in because they’re feeling a little shaky in the shower, for example, because if you fall in the bathroom, it’s very dangerous. Eighty percent of accidents in the home happen in the bathroom. “It’s also a lower dollar value; bath safety is not an expensive way for customers to dip their toes into this,” he continues. “If you are concerned about safety in the home, then getting a shower chair is a fairly benign product — it’s not having to make a big commitment dollar wise or emotionally. And it’s such an easy entry-level way of saying, ‘You know what? I’ll start here and I’ll up to the next products over time.’”
To ensure that providers are maximizing the potential of bath safety, Slavitt recommends displaying as much product as possible.
“We’re a big believer in displaying as much product as we can for two reasons. One, it’s very appealing to customers. And secondly, most of our customers who come into our store have absolutely no context as at all with what we sell. They’re being thrust into this role as a caregiver or end-user with virtually no training.”
Displaying the initial product in the store also pays off down line post-purchase by cutting down on returns. Instead of customers buying what they think will work, they can buy what they know works for them. When product is out and available, customers can test features such as height adjustment, dimensions, comfort and aesthetic.
“We show them the possibilities for solutions and the best to do that is to be able to show them: ‘This one’s a little bit wider. This one has handles on it. This one has a back on it. This one will fit nicely in the bathtub. This one is going to be too wide,’” Slavitt says, adding that because of this hands-on experience, “Customers are able to make an informed decision and be able to see exactly what they’re buying.”
Multiple providers suggest stocking lift chairs in their store. “Lift chairs offer great margins, and high revenue opportunities,” Baumhover explains. “They display well, draw people into your store and provide care-tailing opportunities.”
Stocking lift chairs is also a way for brick-and-mortar HME providers to keep a competitive edge on online retailers. According to Steve Ackerman, CEO of Spectrum Medical in Silver Spring, Md., “lift chairs are items that you can’t comfortably buy on the Internet. Even though it is available on the Internet, people are hesitant to buy there because of possible ongoing service needs and they want to make sure that their warranties are all taken care of.”
Alex Anderson, general manager of Oswald’s Pharmacy in Naperville, Ill., also finds that customers are more comfortable buying lift chairs in the store as opposed to online, especially when they can try them out in the store. “You get to try every chair,” he says. “There’s quite of a lot of big differences between the different chairs. It’s great that the customer gets the option to sit there and try each and every one.”
From a sales and marketing point of view, Baumhover suggests that providers focus on rebranding. “Try to eliminate common misconceptions that lift chairs are for elderly people who can no longer stand on their own,” he explains.
Though senior customers are a large consumer base for lift chairs, anyone with balance and mobility challenges, people with certain chronic illnesses, and people recovering from surgery or injury can benefit. The marketing should not deter non-seniors from considering lift chairs.
PAP DEVICES AND ACCESSORIES
More than 18 million Americans live with sleep apnea, and many of those with a diagnosis require a CPAP or BiPAP machine for treatment. HME retailers are ideally positioned to meet this need. Though many customers will want to use insurance to fund their machine, they are still open to buying the many CPAP accessory products with cash.
To this end, David Gould, co-owner of Gould’s Medical Inc., recommends that HME retailers stock these items.
“We carry all the CPAP types of things: the cleaners, the wipes for cleaning the mask, saline to make the humidifier water pure, sleep pillows. They’re all designed for people with sleep apnea,” he says. “We want to make it as easy as possible for customers who want to private pay for CPAP supplies. Sometimes patients’ deductibles are too high, or they don’t have health insurance, and they just want to buy the supplies.”
Another type of product that Gould finds popular among customers is portable travel PAPs that are easy to pack and carry for people who travel. “Travel PAPs are big these days. They’re very small, and patients who travel a lot would rather bring something smaller than their big CPAP. And they’re a cash item,” Gould adds.
Many types of customers need compression items: seniors, people with diabetes, people with various venous disorders and customers undergoing cancer treatment and wound care. Since Medicare funding and private insurance is limited for compression, most transactions for compression items are done on a retail basis, which gives HME providers a chance to increase their revenue with this product category.
At Oswald’s Pharmacy, Anderson says that compression has been a big product category for the store, which stock four major brands and several donning and doffing hosiery accessories. “It’s been very successful,” he says. “We’re a destination for that because we carry such a wide selection and, of course, we do customs. We definitely want to be a good location with a good reputation by carrying those medical grade brands that a lot of doctors are familiar with and recommend to patients.”
Supplying the right products is only part of making compression a successful product category, however. Anderson says that service is what really drives revenue and sets brick-and-mortar stores apart from online sellers. “These items are an investment for people. Not many people think that a pair of thigh-high socks is going to cost $80-$90. Customers are going to have someone who is an expert hold their hand and walk them through the process,” he explains. “We have a certified fitter on staff that’s going to walk you through how to put the hosiery on, how to take care of it. It’s that level of service that you’re not going to find online or at many other stores in our area. I think that’s a key aspect that makes these items such great sellers because of my staff and how we hand-sell these products.”
Pain management might seem out of place on a list of HME specific product categories, but many medical conditions that drive customers to HME providers come with a lot of pain. It’s not only an essential category that meets customer’s basic needs but also a versatile category that lends itself to cross-over with others.
“Providers should strive to make their product categories complimentary to each other,” Daniel Sterns of William’s Bros. Health Care Pharmacy explains. “Using this strategy, a provider is leaving room for additional sales and service opportunities.”
“For example,” Sterns says, “if a customer enters a store for a mobility product, chances are that they are experiencing pain too. By carrying both a mobility and pain management section, a customer will not only be able to move more freely, but they will be able to avoid any soreness associated with the movement they are making.”
A particular pain management item that David Gould suggests stocking is CBD, which comes in the form of oils, lotions and pills at varying dosages. “CBD is a big item right now,” Gould says, and he’s absolutely right. Researchers at the Brightfield Group estimate that the CBD market will expand to $22 billion in just three years.
“Even people who never thought about it have heard about it. It’s on the Internet. It’s on the news. It’s everywhere now. A lot of people feel more comfortable getting that from us because we’re in the healthcare business,” Gould says.
PORTABLE OXYGEN CONCENTRATORS
Portable oxygen concentrators (POCs) provide an alternative strategy to a tank-delivery model for oxygen. It also provides customers who continue to live an active and mobile lifestyle with an alluring alternative to large and heavy tanks. The smaller, more portable POC lends customers independence from their homes and healthcare facilities.
VGM’s Rob Baumhover recommends stocking POCs for two reasons. First, “Portable concentrators are the hottest trend right now. They are more reliable and affordable right now more than ever before, and manufacturers are spending millions of dollars in advertising. These factors are leading to record sales nationwide,” he says. Secondly, “Accessories, like extra batteries and carrying cases, offer care-tailing opportunities, and together the high demand and high margin dollars make this category highly attractive,” he adds.
“POCs need to be displayed well in the retails area, and all staff need to be fully trained on every aspect of the unit. The key is to differentiate from the direct to consumer crowd by offering education, resources and options.”
As with other HME product categories, finding ways to maintain an edge over online retailers is a necessity. Baumhover says, “Consider offering promotions that would be difficult to find online, such as “Try Before you Buy” initiatives and involving a respiratory therapist for clinical support.”
KNOW YOUR CUSTOMERS
From bath safety to POCs, whatever the product category, providers should choose the product they sell carefully. Alex Anderson says, “I like to think that we carefully curate our product selection. We want to make sure that we have the best of the best. Our buying habits are based on things that we’d let our parents or grandparents use. Is it something we’d personally use? Do we trust and believe in the product.”
By making the selling experience personal, providers will have greater employee buy-in, which is key to selling effectively. Daniel Sterns notes, “Too often we see providers who attend a trade show, buy a new product, and place the product on the shelves without acknowledgment to the employees. This approach makes it very hard for the employee to sell.”
As an alternative approach, Sterns says to “Instead, help create a personal experience for the employees with the new product. Bring in a vendor to do a demo or sales training. Allow them to play with the product, giving them a chance to create a product testimony for their sales conversations. To be an expert, they must feel like the expert!”
Any HME provider who has been successful in retail will tell you that having a friendly staff that has deep knowledge of the products is essential to your store. Importantly, it is the one thing that an online retailer will not have. Staff should know what product their store carries and has in stock as well as how to operate the medical equipment, and, when necessary, train or provide product specialists.
But product knowledge alone is not enough. To have well-rounded staff, providers should look for people who are compassionate. “The first thing that you should look for in salespeople is compassion, patience and understanding,” Wayne Slavitt says. “Each staff member them is expected to know a lot about each of the products we sell. There’s no doubt about that. But the more important thing is to display compassion. We are really big on dignity. The knowledge is important, but here’s the thing: people don’t care how much you know until they know how much you care.”
MORE MUST-STOCK CATEGORIES
While not always core cash categories, these products are retail winners, as well.
Scooters can represent a sizable financial investment for customers. Like lift chairs, people feel more comfortable buying this equipment in-store rather than online. Spectrum Medical CEO Steve Ackerman says that having scooters in the store and on the floor is “time effective in terms of the amount of time it takes to make a sale and have a customer try it out. You’re making money as opposed to spending that same amount of time with bath seats.”
WELLNESS AND DAILY LIVING
Frequently, a provider’s customers are not always the user of the HME equipment—sometimes they are family members and caregivers of the user. “For this reason, it is valuable to offer product categories relating to this type of buyer, as they can be a new prospect to the store. Incorporating selections around wellness or a daily living category can help broaden the offerings for this type of consumer,” Williams Bros. Health Care Pharmacy’s David Sterns says.
Depending on a provider’s location, wound care has the potential to be a successful category for HME. Oswald’s Pharmacy, for instance, is located near a hospital, and Alex Anderson says that because of their location, they can meet its patients’ wound care needs. “When you’re discharged from the hospital, they don’t give away advanced wound care, such as bandages, like they used to. People are waiting for their insurance to ship some kind of the acute need,” he advises. Would care also has the potential for crossover with other product categories, such as compression.
This article originally appeared in the March 2019 issue of HME Business.