Provider Profiles

Sunshine Respiratory & Medical Supply

Where beach balls mix with rollators — and business is hot!

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."

Sunshine goes beyond basic HME, Maxwell says. "We do a lot of
wound care, a lot of rehab and mobility and we carry a lot of DME
items that people don't usually think about," he says. "The typical
customer, when they think of DME — if they think of it at all
— thinks of wheelchairs, oxygen, hospital beds. But when they
come into the Palm store, they walk around and say, 'Wow, I didn't
know you carried all this."

The company also carries lift chairs, scooters, reachers, other
aids to daily living and boots. Here, Naples' wealthy demograpic
plays a hand in product mix. Its downtown GoldShore location,
Maxwell confirms, carries more retail power mobility, and it's not
uncommon for customers to walk in and buy two lift chairs at once
because they want a matching pair. "It's million-dollar clientele,"
he says.

With 25 competitors within 10 miles in the Naples area, being a
diversified company with diversified locations has paid off,
Maxwell says.



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