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Internet retailers concern ResMed - zonk - 03-12-2012
Source: HME News - 07.2006
POWAY, Calif. - ResMed plans in September to implement strict new quidelines--including mandatory minimum pricing--intended to bring law and order to the Wild West approach some online retailers take when selling CPAPs.
"We are going to be strict about enforcement of our Internet policy," said Hillary Theakston, director of communications. "If we find that an Internet dealer is not in compliance, then we will stop selling to them; it's as straight forward as that,"
At issue: Online retailers who sell CPAPs at prices so discounted that they can't afford to offer follow-up service, maintenance or education. The result: Very low compliance.
"We view this as a quality issue," added Stefan Elterich, vice president of sales, North America. "If the follow up care isn't there, it ultimately
reflects on our products and the quality of therapy they provide. From that standpoint, this policy serves our interests in providing high quality therapy."
ResMed estimates that currently about 5% of all CPAP business occurs over the Internet. But as this distribution channel grows and competition increases, the company wants to ensure that patient care is not sacrificed, Elterich added.
Bricks and mortar providers, especially those selling power wheelchairs, have long complained that while Internet retailers often offer great prices because of their reduced overhead, some give little in the way of after-sale service. To counter this, a number of manufacturers have set minimum standards for service and maintenance and don't sell product to any provider--Internet or bricks-and-mortar--who doesn't meet those standards. (See HME News 5/2002).
Several manufactures of sleep products either declined to comment or did not return phone calls for this story. Invacare's vice president of sleep, Ann MacGregor, however, call ResMed's policy "a good thing."
"In every major conversation among manufacturers over the past four years, I've heard complaints that patients end up showing up on at a provider's door because they can't get care from the online seller," McGregor said. "It is commonplace."
Invacare doesn't do a lot of CPAP business with online providers and has not developed a sales and service policy, she said.
In addition to strictly enforcing its suggested retail price, ResMed expects Internet providers to use marketing material as intended, not to resell products intended for the U.S market internationally and to offer education, information and a support team that patients can contact for help.
One Internet provider of CPAP speculated that ResMed implemented the new policy to appease bricks-and-mortar customers upset at losing business to lower-priced Internet providers. ResMed officials denied the charge.
"They look at us as trailer trash or that we stick it in a box and just ship it out, and we don't," said the Internet provider, who asked not to be identified. "They are coming down hard on us."
RE: Internet retailers concern ResMed - enander - 03-12-2012
Resmed got into trouble here in Australia for "price setting", more details here: "www.accc.gov.au/content/index.phtml/itemId/949083"
RE: Internet retailers concern ResMed - Lucy - 03-13-2012
Although the Rsmed rep makes some valid points as regards follow-up, I find it hard to believe that the sometimes large difference in price between the DMEs and internet providers is necessary to support the follow-up. I did use a local DME when I got my first machine and didn't get more than 1/2 hour of support. Now I buy my machines on the internet and use the forums for info. It's worked well for me. For those who need more support, a local therapist can be undeniably helpful. Had I needed more support initially, I probably would have stayed with the local DME. I see it as a case of "we're all different". Why should I have to pay the high prices for support I don't use or need?
RE: Internet retailers concern ResMed - SuperSleeper - 03-13-2012
Nice find, Zonk... thanks!
Quote:At issue: Online retailers who sell CPAPs at prices so discounted that they can't afford to offer follow-up service, maintenance or education. The result: Very low compliance.
"We view this as a quality issue," added Stefan Elterich, vice president of sales, North America. "If the follow up care isn't there, it ultimately
reflects on our products and the quality of therapy they provide. From that standpoint, this policy serves our interests in providing high quality therapy."
In my opinion, this has very little to do with a new-found desire by ResMed to increase patient compliance and the quantity and quality of follow-up care. It has more to do with ResMed's desire to control the price-point of their products by demanding that DMEs sell at a "minimum price" but no lower, so that their overall unit profitability remains high.
Never did like it when a manufacturer did that. They should stay in the manufacturing business and leave distribution to the individual DMEs to run operations as they see fit, after all, they are independent suppliers.
The end result of this is that you have DMEs who will no longer sell ResMed products at a good price because they don't like getting "bullied" by ResMed... and the remaining DMEs will have to sell CPAPs for a higher price in order to appease ResMed. That's not good for customers either, Mr. Elterich.
This is not a good development, IMHO.
NOTE to Gil Ben-Dov (a Vice President at ResMed and member here): Gil, if you're reading this, you need to speak up at ResMed's next marketing meeting. You don't gain market share by creating restrictions and building walls between you and your customers like this. And, I repeat, CPAP manufacturers need to increasingly see the patient as the customer and not the DMEs. We patients don't like price-controls - set the price of your products to whatever you wish when you sell them to the DMEs, but then don't dictate how the DMEs are going to price units when they sell to patients. We don't like that, Gil and we'll take our business elsewhere if we feel like we're overpaying as a result of ResMed's new policy. You've been helpful, Gil, in bridging the gap between ResMed and those of us on the web... please take these suggestions in a good spirit and allow the communication to flow in both ways (from customers to ResMed, and not only from ResMed down to the customers).
Thanks for listening.
RE: Internet retailers concern ResMed - Steven - 03-13-2012
(03-13-2012, 11:03 AM)SuperSleeper Wrote: NOTE to Gil Ben-Dov[/b] (a Vice President at ResMed and member here): Gil, if you're reading this, you need to speak up at ResMed's next marketing meeting. You don't gain market share by creating restrictions and building walls between you and your customers like this. And, I repeat, CPAP manufacturers need to increasingly see the patient as the customer and not the DMEs. We patients don't like price-controls - set the price of your products to whatever you wish when you sell them to the DMEs, but then don't dictate how the DMEs are going to price units when they sell to patients. We don't like that, Gil and we'll take our business elsewhere if we feel like we're overpaying as a result of ResMed's new policy. You've been helpful, Gil, in bridging the gap between ResMed and those of us on the web... please take these suggestions in a good spirit and allow the communication to flow in both ways (from customers to ResMed, and not only from ResMed down to the customers).
Thanks for listening.
I think Gil is only on Facebook these days.
Questionable that he will ever see this.
RE: Internet retailers concern ResMed - SuperSleeper - 03-13-2012
(03-13-2012, 01:25 PM)Steven Wrote: I think Gil is only on Facebook these days.
Questionable that he will ever see this.
Yeah, just checked, hasn't logged into the forum (old one) since the end of December. Looks like the VP in charge of social media for ResMed ain't feelin' too sociable these days.
It's sad, because I feel as though the S9 series of machines is fantastic... if only their overly-controlling marketing people would quit trying to micro-manage the distribution chain, their R&D dept would keep making better and better products at a more competitive price and Resmed would be growing my leaps and bounds... if they would simply leave DMEs alone to price units according to what the market will bear. 
RE: Internet retailers concern ResMed - zonk - 03-13-2012
(03-12-2012, 10:13 PM)enander Wrote: Resmed got into trouble here in Australia for "price setting", more details here: "www.accc.gov.au/content/index.phtml/itemId/949083"Hi enander
I wonder if things changed since the ACCC ruling. It,s not just we pay higher prices in Australia we get lousy service not even 30 days return on equipments.
ResMed acts on retail pricing after ACCC investigation :
RESMED will tell its accredited retailers they are free to set prices for its sleep-disorder device, following an ACCC price-fix probe.
The Australian Competition and Consumer Commission today said it had investigated ResMed, which manufactures sleep-disorder devices, over whether it was telling accredited retailers that it would stop supplying its products if they were sold at less than a price specified by ResMed, a practice known as retail-price maintenance.
ResMed will also revise its internal fair-trading checks following the probe by Australia's competition regulator.
"The ACCC is concerned that between March and June 2009, ResMed is likely to have engaged in retail-price maintenance,"an ACCC statement said.
ResMed had accepted a court-enforceable undertaking to write to accredited retailers of its product, telling them they are free to set their own prices, and to amend its compliance program for Australian trade practices law, the ACCC said.
http://www.theaustralian.com.au/archive/business-old/resmed-acts-on-retail-pricing-after-accc-investigation/story-e6frg97f-1225930721590
RE: Internet retailers concern ResMed - zonk - 03-13-2012
(03-13-2012, 08:27 AM)Lucy Wrote: Although the Rsmed rep makes some valid points as regards follow-up, I find it hard to believe that the sometimes large difference in price between the DMEs and internet providers is necessary to support the follow-up. I did use a local DME when I got my first machine and didn't get more than 1/2 hour of support. Now I buy my machines on the internet and use the forums for info. It's worked well for me. For those who need more support, a local therapist can be undeniably helpful. Had I needed more support initially, I probably would have stayed with the local DME. I see it as a case of "we're all different". Why should I have to pay the high prices for support I don't use or need?I agree and don,t know why we pay higher prices in Australia even the machines are made over here and exported to US.
RE: Internet retailers concern ResMed - Lucy - 03-13-2012
(03-13-2012, 05:09 PM)zonk Wrote:
Thanks, Zonk - happy to be here!
Lucy
RE: Internet retailers concern ResMed - enander - 03-13-2012
(03-13-2012, 05:03 PM)zonk Wrote: I wonder if things changed since the ACCC ruling. It,s not just we pay higher prices in Australia we get lousy service not even 30 days return on equipments.
Zonk, don't think much has changed since the ACCC ruling, an off the record comment from my therapist was ".... are a pain to deal with specially on how much we can sell their units at"
BTW, this seem to be a 2006 article?