Owners: Dutch Atchley, PharmD and Diane Atchley
A five-year campaign to increase their HME department and boost profitability
In a constantly changing industry, owners Dutch and Diane Atchley of Ojai Rexall Pharmacy in Ojai, California, have made it a priority to find areas in their business that can boost profitability. With declining prescription drug margins, Dutch and Diane looked to their front end to give them another area of profit opportunity. They decided to do a five-year campaign to increase their HME department size and sales.
Their goal was to be a destination where a person could walk into their store and get everything they needed after discharge from the hospital. To become this destination, Dutch and Diane broke up their campaign into two phases: 1) investment in a strong selection of inventory, and 2) advertising with a focus on being the place that people could come to for their all their HME needs.
Phase one: create a dedicated space that offers all the products a person might need after discharge from the hospital
The first phase required Dutch and Diane to designate a space in the store for commonly used products. They then invested a robust selection of inventory to ensure they always had stock of the basic products. With a focus on post-hospital discharge patients, they brought in products like transfer chairs, wheel chairs, hip kits, rollators, crutches, urinals, and other basic HME products. When a person walks in the store, they can see ten different walkers and rollators, six transport chairs; three can rack in many colors and styles, as well as much more.
“I can’t tell you how many times we have heard something like ‘my father has fallen and broken his hip. I need a …’ and they load up a cart full of items they need from our selection. It’s convenient as they don’t have to wait for it to be ordered or shipped from somewhere else.”
—Dutch Atchley of Ojai Rexall Pharmacy
To maintain their diverse HME section, Dutch and Diane had to try some new initiatives for the store. First, they found that margins are much better with cash than Medicare or with Medicare-competitive pricing. Secondly, Point of Sale (POS) has allowed them and their staff to have accurate metrics in what is selling versus a clerk’s decision on what is HME.
Phase two: print advertising and mailers to get the word out about their new robust offerings
The second phase of this campaign was advertising. They used Health Media Network to produce direct mailers to three zip codes in their area. Initially, they produced 15,000 circulars, and now they’re doing approximately 10,000 circulars. They’ve also utilized their strong relationship with NOVA Medical Products to share their digital images for ads, allowing Health Media to use the images in Ojai’s direct mailers.
For Dutch, it’s important to understand what his customers are looking for. He does so by adding his personal touch. Dutch makes HME deliveries himself because he gets the product to them quickly and has the opportunity to instruct his customers on proper use. Dutch said, “I like to talk to my customers and make sure it’s a quality experience every time. I want it to be as positive as possible.”