Sunshine Respiratory & Medical Supply

If there's a bright spot in the home medical equipment sector in Naples, Fla., it could well be Sunshine Respiratory & Medical Supply.

It's not even a teenager yet, but the 11-year-old company is pulling down $25 million in annual revenue from its five retail pharmacies, including two locations that focus on HME. And it's doing that by combining beach balls and flip-flops, stamps and packages, ice cream and sodas with prescription drugs and oxygen concentrators.

Not your usual recipe for an HME provider, but then, Sunshine doesn't subscribe to a universal approach to doing business.

"We started Sunshine Pharmacy with a vision to get back to the old-fashioned neighborhood pharmacy feel in our retail stores," says owner and pharmacist Del Parrish in a video on the company's website.

That means responding to particular needs in the individual locations where Sunshine, which opened in February 1999, now has pharmacies and HME businesses.

"The fact that we are independently owned and operated gives us the flexibility to meet the customer's needs on a more personal level," says Ken Maxwell, the company's vice president of sales and marketing. While the core business is the same, each location is tailored to its particular locale. "You don't have that cookie-cutter style," Maxwell says.

The company polled the communities in each location to create its neighborhood-specific stores. At three of Sunshine's branches, for example, you can buy postage stamps or mail packages at the U.S. Postal Service or UPS locations inside.

"One of our locations is next to several residential communities, so having a post office there is a favor. People can come in and do any sort of pharmacy business they need and do any medical equipment business they need [at the same time]," Maxwell says.

At the GoldShore location just a block from the beach, you can stock up on suntan lotion, flip-flops and beach towels. Another location carries sodas, water and ice cream.

"You wouldn't drive across town to get an ice cream bar, but if you're in the neighborhood pharmacy or DME, you'll pick one up," Maxwell says. "It helps get people in the door."

Come On In

Getting people in the door. Sunshine believes that is going to become even more critical as the HME sector gets squeezed by such forces as competitive bidding, audits and rapidly declining reimbursement.

"HME is not something people think about until they have a need for it," Maxwell says. "The more variety you have, the more reason you have to bring people into your store, and they'll tell others, 'I remember seeing that at Sunshine when I was there.'"

Sunshine is actually made up of three divisions — pharmacy, respiratory and medical supply — but there is a unique quality to each store. "This all came about by the belief that to be successful and profitable, you have to adapt to your environment," Maxwell says. That's what got Sunshine into the HME business in the first place.

"A few years ago," Maxwell recounts, "we saw that the changes being made to Medicare's Part D coverage would have a significant impact on our bottom line. Plus, as a pharmacy, customers came in all the time looking for various HME items. So instead of turning these customers away, the decision was made to expand into the HME business"

Sunshine opened one location as a test, and when that proved a success, it purchased a competitor, giving it two key HME locations. The company is looking to open even more stores in the near future, Maxwell says.

Even the HME locations aren't the same, however. Sunshine's major HME shop, known as Sunshine Medical @ Palm, is directly across the street from a major hospital and next door to a private medical center.

"It's a high-traffic location, so we've made it very retail-friendly," says Maxwell. "We remodeled the interior to make more open space, added a mobility section, four patient fitting rooms and more display space. Instead of customers looking at thumbnail pictures of an item on the Internet, they can come in, pick it up, look at it, test it (if appropriate) and then decide if it's what they want, all the while getting advice from qualified, professional staff."