You Are What You Buy: How Your Initial Equipment Purchases Impact Your Service Department Later
- By Laurie Watanabe
- Oct 21, 2007
So you think you’ve found a real bargain: scooters or manual chairs or power chairs that you can purchase at a significant savings versus what you normally pay for similar models from other manufacturers.
But before you sign on the dotted line, ask yourself: What would your service department manager and your repair techs think of this?
A so-called great buy can turn into a great regret if you focus only on the initial purchase price and not on the overall picture. Says Invacare Corp.’s Chris Yessayan, “You have to think of it from the life-cycle cost perspective. Acquisition cost is only a piece of it — there’s also the cost to support it down the road.”
When deciding what brands and models to buy, consider these “life-cycle cost perspective” factors:
1. How easy will it be to obtain replacement parts? Are replacement parts readily available, or will your techs spend hours on the phone trying to track them down… or resort to something even more drastic? “I’ve heard of customers who have had to go out and cannibalize new equipment because the OEM they purchased from didn’t have a parts strategy,” Yessayan says. “So the only way to keep something in service was to get a new product, tear parts off and put it on the (original) product to keep it in service.” If you’re sacrificing new equipment to provide replacement parts to current equipment, you’re also losing money.
2. Does the equipment you’re about to buy feature standard measurements and sizes? Even if replacement parts might be difficult to obtain from the original manufacturer, would other brands of replacement parts be compatible? The answer depends partly on the sizing and specs of the original equipment. Equipment with standard measurements and sizes could potentially use “universal” replacement parts that can be purchased from other manufacturers or aftermarket sources.
3. Consider durability and long-term savings. At times, a higher price tag at the time of initial acquisition can mean savings down the road — especially given the industry’s current competitive bidding situation and the rising costs of commodities such as lead, says Interstate Batteries’ Larry Meeks.
“The way that mobility batteries have been sold traditionally, Medicare and Medicaid have offered to replace a battery after 12 months,” he says. “We give a 12-month warranty on our batteries. Our batteries last much longer than 12 months. But there’s no provision in Medicare or Medicaid for a $5 more expensive battery that would last 24 months (versus paying) $5 less for a battery that’s only guaranteed for 12 months. There’s no incentive to provide a battery that would last the three years of the price lock (i.e., the length of the competitive bidding contract).
“If I was deciding,” Meeks says, “I would look at a battery that I could buy now that would last for three years. Vendors that can provide longer-lasting batteries can help (suppliers) control the fluctuating costs of lead when they’re having to lock in a price for the next three years.”
4. There’s durability, but also inevitability. No matter how innately durable a product is, chances are you will eventually need manufacturer support for it, whether the product fails on its own or has a lot of help from its user. When that time comes, how supportive will the manufacturer be? Does the manufacturer offer not only parts availability, but also convenient technical support, help with troubleshooting, training, etc.?
As a mobility/rehab supplier, you will buy a particular wheelchair, scooter, vehicle lift or other piece of equipment just once, but you need to be prepared to service that equipment for years. Once you factor in all the hidden costs, is that bargain really such a bargain?
This article originally appeared in the October 2007 issue of Mobility Management.
Laurie Watanabe is the editor of Mobility Management. She can be reached at firstname.lastname@example.org.