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Distributors help physicians run their offices
by Andy Brown
Print is terminally ill. Ask the experts, and they’ll say the industry has only so many years left before everything is created, recorded, transmitted, received and stored electronically. They point to the health care market in particular, where the call for electronic records has been gathering steam.
Distributors and manufacturers offer a second opinion. The health care industry is growing tremendously, and their companies are growing with it—through sales of printed products. By targeting private practices and hospitals, they’ve reinvigorated their business. The best part: Health care industry growth shows no sign of slowing down soon. The U.S. Dept. of Health and Human Services projects that national health care expenditures will reach more than $4 trillion and account for 20 percent of the country’s gross domestic product by the year 2015. That translates to more facilities requiring more business communication materials.
Health Care: What to Sell
To win clients in the health care market, it isn’t necessary to sell complex technology. Health care facilities still need fundamental printed products, such as forms. Overall forms sales are declining, but in the health care market distributors and manufacturers see opportunities for growth, sometimes by increasing market share as the print industry consolidates.
Claims forms are good ones to start selling. Health care companies right now are adopting new universal claims forms (see “Health Care Forms Undergo Revision” on page 29). Many aren’t aware of the timeline to implement the new forms. Distributors who sell them have a natural way to introduce themselves to prospects and demonstrate their consultative selling skills. Some distributors even sell the forms as a loss leader to get their foot in the door.
George Fletcher, owner of Medical Forms & Graphics, Darien, Ga., has seen more doctors try to print the forms themselves for record-keeping. “They try to use their laser printers for mass production,” he says. “They think they’re saving money, but they’re not.” Fletcher earns business by showing doctors how he can provide savings with pre-printed shells. The doctors save by using less toner and by improving efficiency, allowing administrative assistants to spend less time printing forms.
Forms are far from the only product that doctors need to run an efficient operation. Once distributors have established a relationship, the most obvious products to sell include routing slips, checks, prescription pads and filing systems, which encompass folders, index tabs and stickers. “I’ve gone to a lot of stock items,” says Fletcher, “labels they use for charts, collection labels and different stickers.”
Doctors also must market themselves to gain business, so they need business cards, letterhead, promotional products, direct mail pieces and brochures. “We do brochures and letterhead, especially in growth industries like plastic surgery,” says Frank Cain, CEO at Medical Business Systems, Charleston, S.C. “They don’t have a sloppy image. They want good-looking stuff. It benefits them to have the best.”
Cain also sells office supplies, shelving and office furniture to clients as needed. “I don’t sell supplies as a general rule, but in the medical trade, you can outfit small offices,” he says. “We’re like a corner grocery store selling hot dogs. If you need beer, we’ve got that too.”
“People want to live longer and better, so there will always be a medical trade.”
Frank Cain, CEO
Medical Business Systems, Charleston, S.C.
Health Care: Why to Sell
The main reason for selling to the health care market is its consistent, long-term growth. An aging U.S. population is one factor that ensures business for physicians and other health care practitioners in the coming years. The U.S. Administration on Aging (www.aoa.gov) calculates that 20 percent of the nation’s population will be older than 65 by 2030. This demographic accounted for 12 percent of the population in 2005. “People want to live longer and better, so there will always be a medical trade,” says Cain. “It is not a risky venture to do business with them. They don’t generally go out of business.”
Not only are private practices stable financially, the men and women who run them tend to be good people, Cain says: “They tend to have lower turnover in staff, they tend to stay with you longer, and they’re loyal customers.” He also says they tend to pay promptly, often within 30 days.
Another reason to sell to private practices is the uniformity of the products they use. “Across the nation, they use the same products, so you know you’ll be able to buy in bulk,” says Cain. Products such as forms, labels and pads also lend themselves to repeat orders. Distributors like Cain add value by providing superior service and a one-stop source for items the offices need.
“Doctors don’t want to be bothered,” says Fletcher. “But they want to make the final decision, so you have to go through their personnel [with that in mind].”
George Fletcher, Owner Medical Forms & Graphics Inc., Darien, Ga.
Health Care: What to Expect
Despite the generally stable business you can get from them, doctors are a unique group of clients. For instance, many private physicians do not participate in day-to-day business operations—they’re tending to patients. However, they still want to be the ultimate decision maker. “They don’t want to see you. They don’t want to be bothered,” says Fletcher. “But they want to make the final decision, so you have to go through their personnel [with that in mind].”
Most private practices employ a gatekeeper who screens sales calls. “You tend not to approach the medical doctor. You’ve got to win over the office manager or practice administrator first,” Cain says. He suggests getting involved with a local medical management association, if there is one, as a way to reach decision makers.
A key to keeping doctors as clients is service. “They’re there to keep people healthy, so they want reliability and service,” says Cain. “The medical trade is more focused on patient care [than on print procurement], so they rely on you to do a good job.”
Fletcher has turned superior reliability—and technology—into an account list of more than 500 customers. “I used to call on them all the time,” he says. “Now I build my business from the internet, word-of-mouth and referrals.” Doctors hesitate to change suppliers, an advantage for distributors who serve them well. “There are more people out there calling on them,” Fletcher says. “But unless something happens that makes them dissatisfied, it’s very difficult to get them to change.”