Are you asking the right question?

 

Hospital Departments and Supply Chain teams, are you still asking vendors to make you offers on devices you no longer use? 
 
Asking this question makes you vulnerable. It exposes you to receiving value the device is worth to vendors, not its market value. 
 
You must know your device's value.  Asking vendors to name a price for your device is the same as listing your house on Craigslist and asking home buyers to tell you what your house is worth.
 

We tested this theory last month while reselling highly demanded surgical device.
 
For the same device, we asked one group of vendors to submit offers. 


And, we asked second group of vendors to pay our asking price. 

Both groups were comprised of equipment dealers, brokers, remarketers, manufacturers and private 3rd parties located in various regions around the world.
 
Results were exactly as projected.  Vendors who chose to participate from the first group, gave offers that were considerably lower than our asking price. 
 
This is not because they were trying to be insulting, but because they gave us offers based on their perception of what the device is worth. 

We positioned this sale by stating: "Taking Offers! Make An Offer!"  Vendors from first group did just that, they made us offers that were marginally negotiable.
 
Vendors who chose to participate from the second group worked with us and agreed to asking price.  

Since multiple vendors agreed to pay asking price, it gave us leverage and position to negotiate with multiple parties.   
 
After negotiations, final price was 94% higher than the lowest offer and 41% higher than the highest negotiated offer received from vendors who submitted offers.
 
Takeaway of this experiment is simple.  Know the value of your device.  Don't ask vendors for offers.  Tell vendors your asking price.  
 
The only questions you should be asking vendors when reselling used medical devices are their expectations related to functionality, inspection and pickup.
 
This approach sets expectations, keeps you in control and makes resale process more transparent. 


EcoMed works exclusively with hospitals by reselling end-of-use medical devices. Even if your hospital has another service provider, you may still have questions, need validation, or resources.  Don't hesitate to reach out and ask.

 

To learn more about benefits of a managing resale of end-of-use medical devices, visit www.ecomedhtm.com or send an email to med@ecomedhtm.com.          

Are You Ready To Do This Right?

It's that time of the year when goals were just set and New Year's resolutions are still part of our every-other day vocab. 

While this topic is still relevant, let's chat how those of you working in healthcare with medical devices can help your facilities set a goal for successful end-of-use medical device decommission/resale program.

Saying you want to sell or you already sell medical devices outside your facility is not enough. 

If you Google "used medical equipment" your search will return dozens of companies unanimously promising to "buy your used medical equipment" and pay "maximum for your used medical equipment".

How do you know which company to select? How do you know if they are paying maximum when all of them make the same claim? Is selling your end-of-use medical devices to a vendor or accumulating them in storage for an auction even constitutes a program?  Absolutely not.

 

A successful decommission program must be Measurable, Dynamic and Strategic. 

 

Before you set it up, ask yourself and all stakeholders the following 2 questions:

1. Who in the facility will take ownership of the process?
2. Who will be our service provider?

Second question is critical and will make the biggest impact on your program's success, revenue, and available resources.

You need to decide if you want to work with a

• Liquidator - service provider that commonly liquidates devices through auctions.
• Used Equipment Vendor - will offer to purchase all available devices for nominal price regardless of device type, condition or age.
• Re-marketer - specializes in online and email marketing of equipment.
• Consignor - likely to take physical possession of equipment prior to sale completion.  
• Consultant - manages resale process, makes strategic recommendations, coordinates de-installations projects, manages logistics and standardizes process across the whole system.
• Yourself - self-administration of the program.

Completing the following 5 tasks to create a roadmap, use proper sales strategy and leverage negotiations:

1. Identify devices already removed from service.
2. Identify devices scheduled for replacement/upgrade this year.
3. Perform Market Demand and Price Analysis for both device groups.
• Adjust for: cyclical price fluctuation, current FDA recalls and manufacturer's notices.
4. Chart removal time line.
• Put dates on monthly calendar. You will start seeing projects from different Departments and Facilities that can be consolidated for potential cost reduction (ex: removal of obsolete fixed equipment).
5. Use this information to set an annual Sales Revenue Target!

These are the basic components to consider when setting a goal for successful program.

 

A goal will guide you and reduce surprises along the way. It will financially benefit your facility.  It will create consistency and transparency.  It will reduce liability. And, above all it will ensure you remain in control of the process.

 

If you continue to haphazardly handle end-of-use devices by storing them, misplacing documents for sold assets, consigning assets for mediocre service, chasing buyers to pick up sold devices, than you will continue to be frustrated by mediocre results and lack of process. 

Now is a great time to set a goal to implement decommission/resale program in your facility.  Do it the right way and you just may reach your Sales Revenue Target by June!

 

And, if you are planning to self-administer the program, Contact Us for a complimentary list of items you need to have in place before the launch.

 

If you would like to learn more about benefits of centrally managed Medical Equipment Decommission Program, please visit www.ecomedhtm.com or send an email to med@ecomedhtm.com.

Transforming Wicked Ways of Selling Used Medical Devices

After 7 years of working in a medical field, I can say with certainty that healthcare professionals are more optimistic about Obamacare than selling medical equipment they no longer need. 

Almost everyone who works in a hospital has a colorful story about their experience with sale of used medical devices and vendors who purchased them.  

And, it makes no difference if they sell equipment at an auction, from the hospital's basement or online.  At the end of the day, most feel cheated and mislead by the buyer. 

Regardless of their title and location, the sentiment shared by folks who work in healthcare and have to deal with trading-in or selling equipment is the same:

“Three words: used car dealership.” – Respiratory Nurse, MI

“I was selling a new patient monitor and told by one buyer it's worthless because key options are not enabled.” – Cardiologist, MO

“We auctioned a truck full of equipment and received a check for $250. How’s that possible?” – Hospital Purchasing Manager, IL

Are these folks the ones to blame because they assumed prices published on the internet are actual prices vendors pay?


Did the vendors who purchased the equipment take advantage of them?

Or, is the medical device industry guilty as a whole because it deliberately keeps prices hidden from the public?   

Answers to these questions are irrelevant because each party will have their own truth. However, what is relevant is that none of the folks selling equipment followed a process.  

They either contacted a vendor they already knew, or searched for one on the internet. That’s not a process, that’s equivalent to calling Goodwill and asking them to buy a juice maker that was received as a housewarming gift and never used because “it's just a pain to wash after each use”. 

Without a process, resentment, frustration and mistrust will continue to plague the minds of healthcare professionals whose jobs require them to manage aging medical devices. 

And that’s too bad, because selling can help one’s bottom line (if done properly) and help medical communities that do not have first-hand access to diagnostic and life-saving equipment.  

So, if your facility is ready to transform how used medical equipment is sold, here are some helpful tips:

1. 
   Centralize and standardize the process.  Having one central location to process all devices that are being sold is more efficient then having 7 nurses trying to sell 3 IV Poles.  
2. Manage the process.  Accountability and understanding the process directly correlate to revenue that will be generated.  If your facility is content with $250 check for a truck full of equipment, assign the process to an existing, already swamped employee.  If your facility is ready to command $8000 for just one ultrasound, outsource the process.  
3. Don’t use the same vendor to buy all your equipment.  This is the same as investing all your money into one stock.  Vendor diversification is just as important as financial diversification.  Vendor who specializes in refurbishing patient monitors will pay more for the monitors but they will pay below market price for the surgical table.  Contrary to popular belief, international vendors are not looking for donations of crappy, old equipment and will pay premium to acquire working devices.      
4. Don’t use the same method to sell all your equipment.  Some devices such as ventilators should not be traded-in to the manufacturer, fixed diagnostic systems are simply not suited for auctions and hospital furniture does not sell well at onsite sales. 
5. Time the sale.  Did you know that same vendor will pay 15-22% more for equipment if they have a buyer and even more if their buyer gave them a PO?  Timing the sale leads to more revenue.  Isn't it fantastic?  There’re always problems related to budget deficits, unbudgeted expenses and missed annual targets. Without too much effort that financial gap can be reduced just by learning if equipment is being purchased for stock or for an end-user.

If the thought of selling used medical equipment is daunting and hearing the same old story of how equipment is not desirable because "it’s not painted orange with green polka dots" is annoying, take action.  

Without a process, valuable devices will be undersold, inefficiency and miscommunication will flourish and staff will continue to waste time and mistrust buyers.  Start the process, own it and rally the troops to support it!

If you would like to learn more about the benefits of an in-hospital, centrally managed Medical Equipment Decommission Program, please visit www.ecomedhtm.com or send an email to med@ecomedhtm.com.