Page 34 - HME Business, November/December 2022

Business Solutions
trying to keep up with demand, and that’s going to create change.
“Millions of Americans continue to age with chronic conditions, and they want to be in their homes,” Marx says. “Not to mention, large corporations are designing and acquiring infrastructure to support us there. Hundreds of billions of dollars are being spent to create new layers of homecare support from Amazon to Aetna.”
That means services like outsourcing staff or workflows will continue to play a key role in provider strategy.
“Look at every part of your business and determine where you deliver real differen- tiated value,” Marx says. “Don’t outsource what should be your ‘special sauce.’”
Similarly, technology will also be important, he adds: “Finding tools to automate simple business tasks will relieve your constrained workforce from performing simple tasks, so they can focus on what matters.”
INFLATION AND RETAIL
Of course, funded providers aren’t the only providers getting hit by economic factors. Inflation is hitting retail providers heavily
as well. Faisal Poonawala’s Spring Branch Medical Supply is a retail-only provider, and where customers would be a lot more liberal in their HME spending, they’re now reviewing their purchases a little closer. That’s particularly true for clients who are on fixed incomes, such as seniors, he adds.
“Everybody is more cost-conscious these days,” Poonawala says. “Whereas before, if someone was coming in for a bath chair, it was easy for them to also get a couple of add-ons, such as a bath mat, or handheld shower.
“Now, the shower chair now costs 20 to
25 percent more than it did a few months ago, and that increase is now impacting the purchase to where that customer might not be willing or able to afford some of those add-ons anymore,” he continues.
The strategic responses to this are tricky. Poonawala says that, for starters, Spring Branch Medical Supply has had to absorb some of the cost increase on some items.
“We haven’t been raising our retail price proportionately to our increase in our wholesale cost,” he says. “So, if the whole- sale cost went up 25 percent, I definitely didn’t raise my retail price 25 percent.”
As a result, Poonawala says he has actu- ally decreased any growth in gross profit margin. It’s a tough bite, but it helps him stay competitive, make the sale, and keep customers.
Another strategy is to make some tough decisions about his vendor partnership. In last year’s roundtable, Poonawala high- lighted the need for brick-and-mortar retail HME providers to protect themselves when it comes to competing with online pricing. Inflation required him to fast-track his policy.
“If they are not giving a healthy margin
Faisal “RJ” Poonawala, President of Spring Branch Medical Supply
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22 HMEBusiness | November/December 2022 | hme-business.com Management Solutions | Technology | Products Untitled-101 1 7/27/22 10:53 AM