Incorporating retail products in your aesthetic practice can substantially strengthen your sales program, increase patient satisfaction, boost profitability and increase patient retention.
The key to a successful retail program is to focus on products that complement your treatments and services. Don’t try to be a one-stop-shop. Carefully define what products will augment laser skin resurfacing, body contouring or skin tightening; research the options; have the reps come in and do an in-service; ask to evaluate the products in addition to understanding the numbers and the support the company offers.
Once you’ve selected your vendors and the lines you want to carry (my recommendation is no more than three to four), then spend the time and resources necessary to train your staff and integrate the products into your personalized treatment plans and services.
My motto is ABE – Always Be Educating. If you aren’t, or your team isn’t, stats show your patients will go to a department store or CVS and buy products, which obviously does not add value.
Here are six steps to build your retail program:
1. Define your niche
The most important step in building a successful retail program is defining your niche. The products you choose should be carefully tailored to your treatment plans. Do not try to offer every product on the market. This will overwhelm your patients and will negatively impact your retail profitability because patients will feel less like they are being offered a product to enhance their specialized treatment, and more like they are being sold as many products as possible to increase their overall expenses.
By focusing on a particular product line, you also give your staff the opportunity to really learn the products, applications and relevant technology. Their ability to answer patient questions accurately and thoughtfully is critical and will further enhance the patient experience.
2. Research the options
Conduct careful and thorough research of potential retail partners, their products and their current relationships with other offices. Once you’ve honed in on a specific type of product, take note of how many retailers offer that product and what types of products are typically offered in parallel. When choosing a vendor, prioritize product quality and partnership satisfaction. Product quality is crucial – what you offer patients in your office will reflect on the overall quality of your services.
Equally as important is partnership satisfaction. How easy is the vendor to work with? How frequently are they willing to deliver and replenish inventory? What are the potential mark-ups on each product? Is there any opportunity to grow with the vendor and expand as demand increases? What educational support do they offer? Are there minimum quantities? Do they buy back? These are key details to know in advance of making any binding commitments with potential vendors.
Make sure any contractual agreements signed are mutually beneficial. Since product prices can fluctuate with the market, you may want to request written confirmation that the price will not fluctuate more than a maximum allowable percentage, based on your evaluation of profitability. The most important part of managing your relationship with vendors is to maintain transparency.
3. Evaluate the numbers
Once you’ve identified a few vendors, you’ll want to dig deeper into the numbers. What types of products offer the highest profitability? What products offer patients the best outcomes either as stand alones or in combination? What is a typical quarterly ROI? A key part of your investigation should be based on patient satisfaction. After all, even if profitability on a product is historically high, you must first sell the product to make a profit. Research how well customer’s respond to specific products offered by each vendor and calculate an estimate of overall satisfaction.
4. Integrate products into your treatment plans
Aside from product quality and vendor relations, the most important part of a successful retail program is how well you integrate product lines into your treatment plans and services.
Create in-house literature to support the products you offer. Include the expert opinion of physicians, as well as positive feedback from patients who have already tried the products in your office. If a specific product has been shown to increase the effectiveness of a certain treatment or prolong the effects of a certain service, emphasize that in your marketing plan. In short, the product line you’ve chosen to sell should not stand alone in the back corner of your waiting area. Spotlight the products by featuring them in personalized treatment plans and monthly specials.
5. Train your staff
The success of your retail program is directly proportional to how well your staff is trained. It is critical that every member of your staff listens to and engages your patient population. They should be intimately familiar with the personalized treatment plans and services you offer.
When you launch a retail program, invest in staff training. A well-trained staff will have a thorough understanding of your products, how they will be incorporated into your treatment plans and how they compare to similar products on the market. The goal is to inform your staff so they can inform your patients.
6. Keep an eye on the numbers
Once you’ve built a retail program, you’ll want to review the numbers at least once a quarter. Calculate your overall ROI on retail sales and determine which products have the highest sales and profitability rates. Also take note of which products patients purchase more than once.
The most expensive products do not always offer the highest profit margins. Use this data to tailor your marketing program and staff training, if needed. If a particular product isn’t selling well, execute a plan to incorporate it into a monthly special or feature it in a specific service or treatment plan.
Consider sending out a product survey in your quarterly newsletters to get a pulse on which products your current and prospective patients are most interested in.
And, if you have any questions, I’m here to help. Feel free to contact me at [email protected]