Transcript of The Secret to Selling to Hospitals with Kevin Trout
Pitt Innovates
0:02welcome everyone to October's shrs0:05Innovation seminar0:08um so this month we'll have Kevin trout0:10here talking with us about the secret to0:12selling with hospitals so Kevin is an0:15experienced entrepreneur business owner0:17and sales professional with over 350:19years of experience in the medical0:21device industry Kevin was the founder0:23and president of Grandview Medical0:25resources Inc in Pittsburgh Pennsylvania0:29um this company was a specialty medical0:30equipment distributor with an average0:32annual growth rate of 23 percent per0:35year before selling this company in0:382011.0:39um by the time he retired in 20160:41Kevin's company was conducting business0:43with approximately 90 percent of the0:45hospitals in his market so that market0:48was the Western PA and West Virginia0:49area and it included a 10-year contract0:52with UPMC Health Systems so lots of0:55great information to come today in this0:58chat uh so looking forward to hearing1:00from you Kevin and take it away whenever1:02you're ready1:03well thank you very much for having me1:05so welcome to the session on the secret1:07to selling the hospitals1:09I'm gonna give you the secret right up1:11front1:12it's understanding a Hospital's buying1:14process because the hospital's buying1:16process trumps your sales process 100 of1:19the time1:20it's complex and you've got to learn the1:23rules of the game if you don't play by1:25the rules you run the risk of getting1:27banned from the hospitals possibly for1:30life no matter how good your technology1:32is so we're going to talk about1:35how to navigate1:37the hospital buying process1:40these are the things we're going to talk1:41about today1:43who are the decision makers who are the1:45key influencers and who are the decision1:47processes1:48how do they work together1:51what's a value analysis committee how do1:54they function1:56nursing education is some of my favorite1:58people these people know a secret that2:00you need to know2:02we're going to talk a little bit about2:03the options when it comes to2:05distribution channels we're also going2:07to touch on healthcare industry trade2:09shows and how valuable they are I'm2:10going to share my personal favorite with2:12you2:13we're going to touch on gpos which are2:15group purchasing organizations if you're2:17familiar with them you know what they do2:18if you're not familiar with them well2:21they play a role in Contracting as well2:24as2:25they may be able to influence the fact2:27that you can't even walk in the hospital2:29to make a sales call2:30so we're going to talk a little bit2:31about that we'll talk about pricing2:33strategies not because I want to tell2:35you how to price your product but2:37because I want to make you aware of a2:39trap that you can fall into if you're2:41not aware of it2:42then we're going to talk a little bit2:44about leveraging your successes and then2:45how to connect with the right people2:47I'm sharing my personal experience in2:50the 34 years I was in medical sales2:52so this is not all encompassing but at2:54least I'm going to create a framework2:55that you can work from as you begin to2:59pursue sales in hospitals are you ready3:03let's talk about key decision makers key3:05influencers and decision processors3:08the key decision makers in hospitals3:10today are the value analysis committees3:12also known as product evaluation3:14committees yeah they have some3:16subcommittees that are part of them like3:18I dealt with the bariatric committee I3:20dealt with the Safety Committee but I3:22also dealt with the main value analysis3:24committees as well3:26these are the people who look at all new3:29medical technology3:30they hold the keys to the kingdom okay3:33and it's a process to work with them and3:36we'll talk a little bit more about what3:37that process looks like3:39who are the key influencers well they're3:42the individual nursing units3:44when the value analysis committee3:46gives your product a go-ahead3:49usually goes to an evaluation there's3:51usually a nursing unit or two or three3:52that get out get identified to be the3:54ones to evaluate your product those3:57individual nursing units are going to3:58fill out a survey they're going to give3:59you the the committee they're going to4:03give them their feedback what's the pros4:04what's the cons what are the likes what4:06are the dislikes do we recommend using4:08it do we recommend adopting it or not4:10all of that gets fed back up to the4:12value analysis committee so they do play4:14a key role in influencing those4:16decisions that are made4:18also nursing Specialists I typically4:20work with the wound care nurses and4:22infection control nurses4:23there's a lot of other ones as well4:26Physicians are a key influencer now4:28you're properly saying hey wait a minute4:30I thought Physicians had some say so on4:32what products to get to use yeah 204:34years ago they did those were physician4:37preference items but what's happened in4:39today's market space is Supply Chain4:42management is literally corralled4:45Physicians preference items so there's4:48not very many of them what happens now4:49is4:50many of the Physicians practices are4:53owned by the hospitals so when4:56supply chain contracts with vendors they4:59tell the Physicians Which con which5:01vendors are contracted with and what5:02products they can use if the physician5:04finds a product that they like and they5:06want to have the hospital evaluate so5:08they can use it they have to run it5:10through the value analysis committee so5:12they they can present it to them and ask5:14them to run through the process but the5:16Physicians typically don't have the5:18power to buy on their own anymore so5:21that's why I call them key influencers5:24decision processors these are the people5:27who process other people's decisions5:29mainly the VAC committees5:31purchasing agent Supply Chain management5:33materials managers5:36so here's a deal with purchasing agents5:38and and I respect the job they have to5:41do my key thing is don't try to make a5:44sales call to a purchasing agent they'll5:46try to sell them on your product or5:47technology5:49you're going to meet with purchasing at5:50the beginning of this whole process and5:52you're going to meet with them at the5:52end of the whole process5:54but the process in the middle is when5:56the the value analysis committee does5:58their work6:00so in the beginning you want to drop off6:02the information of the purchasing agent6:04simply three things here's our product6:07here's our price here's how to order it6:10that's all you need to give them6:12and just let them know6:14I want to make you aware of what we have6:15and what we do in case any of your6:17clinicians want to take a look at it6:20and if they do we'll make you aware6:24now when the value analysis committee6:27goes through their whole process6:29and they decide that your product is a6:32go6:33yes we want it we're going to bring it6:35in we're going to make it standard of6:36care6:37then they send you back down to6:38purchasing and now that purchasing agent6:40is obviously negotiated contract with6:42you or in essence the lowest possible6:44price they can get from you okay and and6:47if there's any purchasing agents on this6:49call all due respect I appreciate the6:51job you have to do okay6:54so let's talk about the key decision6:55makers these are the value analysis6:58committees6:59these are made up of individual nursing7:01unit managers some especially clinical7:04managers there's always somebody from7:06purchasing whether it's the purchasing7:08agent or the buyer from the purchasing7:09department because the clinicians are7:11representing the clinical efficacy we're7:14looking at the clinical efficacy of your7:15product technology and the purchasing7:17people7:18are handling the money meaning they have7:22to they have to represent the interests7:25of the financial people okay7:28and really the whole idea of the7:30Committees is to evaluate the clinical7:32efficacy and financial improvements that7:34can be gained with the new technology it7:37is a long drawn-out process how they7:39work7:40hospitals these value analysis7:43committees typically meet once a month7:44and they have an agenda of new7:45technology that they want to talk about7:47during that meeting that month they7:50don't always get to the whole list of7:52especially products so you might get7:54bumped to the following month so it7:55might be months before you actually get7:57brought up7:59most of the value analysis committees8:02will bring the vendor in to do your dog8:05and pony show so don't be surprised if8:07there's a line of vendors outside the8:09committee meeting room door waiting to8:12do their 15 minutes of fame8:14when you do your presentation you're8:17going to be educating the clinical8:19managers on your product and what it8:20does8:21one of the things that we did in my8:24company that I think made us Stand Out8:26was we would find out who the members of8:29the committee were before our product8:31came up on the agenda to be discussed8:33and we would try to meet with as many of8:36those members as possible to do an8:37interview not to make us not to make a8:39sales call but to interview them to ask8:42them questions how are you managing the8:44patients right now that our product can8:47service tell me more about that what are8:49the biggest challenges what are the8:50things you'd like to see different would8:52you like your hospital to provide to you8:54that might improve quality care or make8:56the nurses jobs easier8:59again we don't sell them We Gather that9:01information so when we would go in and9:03do our 15-minute product presentation9:05two things happen one9:08or a known entity because we've already9:09met with these people so they know us9:11already the second thing is eighty9:13percent of our presentation was simply9:15based on the feedback during the9:17interview that they gave us9:19well Ann said this this is what she was9:21looking for this is how we do this9:22Paula said this this is what we do to9:25address that 20 of our presentation was9:28actually about the product it was more9:30about9:31the outcomes that they can expect to9:33derive based on the challenges they9:35share with us that's a totally different9:37presentation than a lot of other sales9:39reps would make which is mostly a9:41PowerPoint presentation about their9:43product you know you know make basically9:45specs9:47so we did it a little bit differently9:48and it worked very well for us9:50so let's talk a little bit about9:52the purpose of value analysis committees9:55so9:57I like these two quotes because the9:59first one is really really simple right10:00value analysis is not about finding just10:03the writer the cheapest price we should10:04balance reducing costs and improving10:06quality it's very straightforward right10:08the second one I like a little bit10:10better because I think it's more10:11encompassing the goal of value analysis10:14is to work as a multi-disciplinary team10:16which is why you have all the clinicians10:18and purchasing on the same bioanalysis10:21committee making product decisions based10:23on a holistic educated and um10:26understanding of how a given product10:28will impact patient care financials and10:30the facilities strategic goals I think10:32that's a really great definition10:38all right here's the one that makes me10:40cringe10:42the focus of a True Value analysis10:45should be to determine the clinically10:46acceptable products10:48not clinically Superior clinically10:50acceptable and from there create a10:53competitive Contracting environment10:56that will result in the best Economic10:58Opportunity for the facilities what10:59they're saying is you don't have to be11:01clinically Superior just have to be11:03clinically acceptable and we're going to11:06find out who all of your competitors are11:08we're going to get pricing from every11:09one of them11:11and then we're going to leverage their11:12pricing against you11:13be prepared for that because that's how11:15some hospitals work not all of them but11:18some11:19more than you would like11:21all right so that's nurse that's uh11:23value analysis committees they are the11:25decision makers and their process can11:27take months11:29the days the old days of walking in11:3220 years ago you could go in meet with a11:34unit manager11:36make us make a sales call you'd walk out11:39with an order because they had the11:40ability to make that decision11:41can't do that anymore the days of the11:44one call close the mythical one called11:46Closer over11:48so let's talk about Nursing education11:49switch gears a little bit here why do I11:51like these people I11:53really respect Nursing education I11:56respect all nurses in general if there's11:57any nurses on this call11:59you should raise your hand and be12:01recognized because I'm going to tell you12:02you are my heroes okay you have the12:05toughest job and your commitment and12:07your compassion is off the charts and I12:09really really respect the job that you12:11do12:12but Nursing education in particular12:14these are the people that when the value12:18analysis committee are back for short12:20when the VAC committee says hey we found12:23a product we want to go forward we want12:24to do a trial evaluation12:26they contact Nursing education nursing12:29and education will set up all the uh12:32they'll coordinate all the product12:33training what we call in-servicing for12:35your product during that evaluation12:36here's the secret12:39they know everyone is on the committee12:41they know all of the VAC committee the12:44chairperson and most of the members12:46so here's my point12:48if you go to purchasing and you ask hey12:51who's on your product evaluation12:52committee or your vac committee12:54they typically won't tell you what12:56they'll say is oh that's confidential12:58again share that with you12:59however if you go to nursing education13:01and you let them know13:03hey we've got a product that's on the13:05agenda I don't know which month it's13:07going to come up13:08um or when so the the thing is we would13:12like to just share some information with13:14the committee members and really want to13:16learn from them a little bit about what13:18they're doing right now to make sure13:19that when we do our presentation it's13:22it's impactful and meaningful to them I13:24would tell you that nine times out of13:26ten that I have asked that question13:30the nursing education manager provides13:32the committee members and their email13:34addresses for me so it's just a way of13:36making sure that you get to know who's13:38on the committee who's going to be13:39making a decision for you13:43all right13:46Switching gears let's do a little bit13:49about distribution channels13:51if you're a startup13:54or even in the first phases of scaling13:56up13:57I can tell you a direct sales force it's13:59a pretty expensive way to go and these14:02are the people that are W-2 employees14:03you have 100 of their time and attention14:06um many companies don't start with a14:08direct sales force when they're in their14:10scale-up mode or startup mode14:12typically go through distributors or14:14independent sales reps14:15with regards to distributors14:18there's a couple of trade associations14:21MDA which is the independent medical14:22Distributors association of North14:24America these are the specialty14:26Distributors these are the people that14:28bring new complex technology to14:30hospitals they have a history of over14:33the past I don't know 60 70 years14:35launching new medical technology that14:38today is now standard of care in most14:39hospitals across the country14:43um I was a member of Emma myself as an14:45independent distributor and I served as14:46a president back in 2010 and 2011. it's14:49a great organization what they bring to14:51the table is the established14:52relationships that they already have14:54with supply chain and with clinicians in14:57the hospitals that are given geography14:58right so when you when you get them to15:01distribute your product they're going to15:02bring your product in and they're15:04already typically selling other products15:06to those same hospitals and they'll be15:08able to bring yours in it's a whole lot15:09easier15:11the other trade Association is Haida15:13which is the help industries15:15Distributors Association these are more15:17the Box Movers these more like15:19uh tongue depressors and adult diapers15:22and bed pans high volume low margin15:26um stocking Distributors right15:28then there's the independent sales reps15:30these are the straight commission 109915:32reps15:36their trade Association is higher up15:38Health Industries Representatives15:40Association the difference between15:42higher and Haida high-dose stocks stocks15:45your product they're going to pay your15:46wholesale price they're going to sell15:49the product to the hospital they'll15:50build a hospital and they'll collect15:53payment from the hospital15:55independent sales reps they'll generate15:58an order for your product they'll send15:59the order to you you as a manufacturer16:01will ship the order you'll build a16:03hospital you'll collect payment for the16:05hospital and then you'll turn around and16:06cut a commission rep commission check to16:08the sales reps so it's just a different16:10ways typically the 1099 independent16:14sales reps are carrying five or six or16:16seven product lines but they too have an16:18established relationship already16:20existing with the people that make the16:22buying decisions and process the buying16:24decisions in the hospitals16:28foreign16:30okay let's talk let's touch on16:33healthcare industry trade shows these16:35are important16:37they're especially trade shows both16:39National local chapters for just about16:41every nursing specialty and even16:43physician specialty okay there's a16:46American Association of Orthopedic16:48nurses there's a National Association of16:51rehab nurses there's the American16:53Association of critical care nurses16:55there's a national trade show for all16:58these people somewhere around the16:59country every year but then they also17:01have local chapters where a local17:03chapter of the critical care Nurses17:05Association will have their own mini17:09trade show here locally17:11in between the annual one for the17:13national okay17:15and whatever product or whatever uh17:19especially area of care that your17:21product fits into you're going to want17:22to look into what's the trade show or17:24what's uh what is the trade Association17:27and where's the local chapters17:29now get into my favorite ones okay17:31the American organization of nursing17:34leadership these are the chief nursing17:36officers the vice presidents of nursing17:38these are these are the top clinicians17:40in any organization17:42and their National Organization is the17:44aonl but here's my favorite this is the17:48southwestern PA organization of nurse17:50leaders affectionately referred to as17:52swaponal17:53these are the people that are the chief17:56nursing officers they're key main17:58lieutenants and it draws from Eastern18:01Ohio18:02southwestern Pennsylvania Northern West18:04Virginia18:06this trade show is always at the last18:10three days of August right before18:13um Labor Day it's the last three it's18:16Wednesday Thursday Friday right before18:17Labor Day weekend it's always at18:19nemacolon and it is well worth attending18:22we had great success going to swaponal18:25every single year because we would see18:27the chief nursing officers in the18:28hospital who were doing business with18:30and we had a very great relationship18:32with them but they also would bring over18:34the chief nursing officers from the18:35hospitals that we were not doing18:36business with and it's a very relaxed18:40setting people are much friendlier you18:41got them outside of their hospital18:42setting so they're they're more open and18:45they're willing to to listen and learn18:47and we picked up a lot of new hospitals18:50through this waponal organization18:53meeting every year18:55it should it's very very well attended18:57now you're18:59you're your account or your controller19:01is probably going to balk at the price19:04um as in we can't afford this well I can19:06tell you that19:07it may be a little pricey but it's19:10definitely a worthwhile investment19:12um we we gained great ground in our19:15ability to get into hospitals because19:18if we met the chief nursing officer19:20they would normally say ah I know the19:22personal organization I want you to go19:23meet with so we would contact that19:25person and say hey your Chief nursing19:27officer asked us to reach out to you we19:29would always get an appointment that way19:31almost without fail so it's one of the19:33little tricks that work really well19:35oh boy we're purchasing organizations19:38I don't know how many people understand19:40how the group purchasing organizations19:42work but it's important that we touch on19:44it19:45gpos typically have I don't know 800 or19:48so hospitals the longest members there's19:506 000 hospitals in the United States19:52so there's a handful of gpos and their19:55goal is to negotiate contracts with19:57vendors at deep discounts20:01here's the thing it's a double-edged20:03sword hospitals often belong to two or20:05more gpos so you might have a contract20:08with one GPO and so I'm sorry we buy20:10from the company that's contracted on20:12the other GPO20:15they're not exclusive contracts20:17their selling point is hey if you uh if20:20you work with us as a GPO we can give20:23you access to our 800 member hospitals20:27well20:29that's why well and good but there's no20:30guarantee they're going to buy from you20:31because it's sort of hey it'll get you20:34in the front door you can now claim to20:37be a GPO contracted vendor but that20:39doesn't mean they're required to buy20:41from you you still have to go through20:42the whole selling process the whole20:44value analysis committee20:48uh Journey that that they have in place20:50you still may not get chosen because20:52whether the gpos typically do is if they20:55give you a contract they're going to20:56find out who your competitors are20:57they're going to go negotiate with20:59contracts with your competitors as well21:00so21:02in my in my experience we there was five21:05companies that did what we did okay and21:08all five of them had the GPO contract21:10with almost every one of these so21:13Premier is a big one there's UHS Vision21:15it's the old Med assets along with21:18another one I forget21:19Health Trust um I can tell you Health21:22Trust is the toughest21:25if you walk into a Health Trust hospital21:27it's a sales rep the first question at21:30the door is are you a Health Trust21:31contracted vendor if your answer is no21:34they escort you out the front door you21:36can't go any further21:38um really tough to deal with fortunately21:39that it's not a huge number of hospitals21:42but they're pretty21:43in the South particularly there's a lot21:45of them so the a health system right21:48they have their own GPO if you want to21:51get a VA contract I would highly21:54encourage you to work with an organ an21:56outside organization that specializes in21:59getting VA Hospital uh22:02uh contracts because it's very complex22:05if you've never done it before22:08um it's22:10it's a lot of work so anyway the whole22:13purpose of the gpos is to leverage22:15buying power expect to Discount roughly22:1730 or you know give or take for a GPO22:21contract here's the tricky part22:24this is the tricky part22:26if you go into a hospital22:28the first time and you talk to22:29purchasing22:30their first question is well you are you22:33on our GPO contract22:34if you don't have a contract saying no22:36they go up sorry22:38if you don't have a g if you're not on a22:40GPO contract I can't let you talk to any22:43of our clinicians22:45okay so then you go to the GPO and say22:47hey22:48we need to get a contract with you so22:49that we can go into your member22:50hospitals and and sell to them the GPO22:53says well which one of our hospitals is22:55interested in your product22:56and your answer is well none of them yet22:58because we haven't been allowed to well23:00the GPO says why would we negotiate a23:02contract with you if none of our members23:04are interested come back when somebody23:06is23:07it's one of these it's a stalling tactic23:09there's two ways around it number one23:12you can tell them hey23:14our product is unique there is nothing23:17like it on the market so therefore we23:19don't compete with any of your GPO23:20contracts23:21that'll get you passed23:24um some of the the installing tactics23:26maybe you do have competitors so you can23:30say hey we actually are in the looking23:33forward to getting a GPO contract some23:36point in the future23:37we intend to work on that but we know23:40how they work in order for us to get a23:42GPO contract we have to have some of23:44their member hospitals interested in a23:46product which is why we're here so we23:48would like you your hospital to be one23:51of the member hospitals to take a first23:53look at what we offer and if it works23:55well and you like it then we would ask23:58for your support when we go to the GPO24:00to ask for the contract24:02if you have that type of dialogue a24:04purchasing agent is going to know that24:06you understand how to play the game24:08all right24:14let's talk about pricing strategies24:18I'm not going to tell you how to price24:20your product but I am going to give you24:22an example so that you can be aware of24:23the Trap that you might fall into24:26let's say for example you need a gross24:27profit margin of 40 that's pretty24:29typical actually because 40 enables you24:32to make your payroll it enables you to24:34make uh you know your over cover your24:36overhead if you're really good you might24:38be only need 35 so that extra five24:41percent can be reinvestment dollars that24:42you put back into your growth so if you24:45were to price your product with the cost24:46of goods and a 40 margin my example is24:49cost of goods is sixty dollars forty24:51dollars for the gross margin your24:52minimum price is a hundred dollars24:54you're gonna have to raise that price24:56because you will be pressured25:00to lower your prices it will it's going25:03to be demanded gpos are going to ask for25:06a 30 discount Regional purchasing25:08coalitions which are subgroups of gpos25:10they're going to want another five to25:12ten percent to actually act as Champions25:15or sponsors for your product in the25:17hospitals members that may not be taking25:18advantage of your GPO contract Supply25:20Chain management and idn contract25:22administrators are going to ask for more25:24of a discount25:25here's the latest thing that they have25:29started saying and it happened I don't25:31know six years ago suddenly we were25:33hearing it from every hospital they were25:36saying oh you you have our GPO contract25:38that's great25:39however25:41the pricing that you have on a GPO25:43contract is just our starting point for25:45negotiating25:47what25:49we had to go back to the GPO saying this25:51is what we're hearing from multiple25:52hospitals and they say yeah this is what25:54they're doing today so you're going to25:56get a lot of pressure25:58to lower your price your margins are26:00going to arose they're erode26:03there's a lot of companies out there26:04that did not position themselves price26:06wise and in a way that as they began to26:09accept these price concessions that were26:12demanded of them they went too far and26:14they ended up going out of business you26:16need a 40 gross margin after everything26:18is said and done just to keep your doors26:20open and stay in business26:22so think about what your numbers are26:25your controller or CFO can figure that26:28out I'm just throwing out an example but26:30just26:31trap is know that you will have price26:34concessions demanded of you26:37and then there's this thing called26:39vendor credentialing which is really26:41expensive and it is a fee that you have26:45to pay for each one of your sales reps26:47to walk into every one of the hospitals26:48that you have them calling on26:51that's a whole other subject26:53for another day26:57Okay Kevin really quickly before you27:00jump to that there's a couple questions27:01just about gpos and just understanding27:04how gpos make money if possible really27:07fast27:09um it's a question our Hospital Systems27:11generally part of gpos or our individual27:13hospitals they are they all belong to27:16gpos every single hospital or health27:19system will belong to one or more gpos27:23so UPMC they they have uh Med assets and27:26I think and premier27:29I think Manassas is now busy in27:31um West Penn and that's Allegheny Health27:33Network yes they have their GPO as well27:36um yeah you're you'll be hard-pressed I27:39don't believe there's a single Hospital27:40in America that doesn't belong to at27:42least one if not two or more gpos27:45and how does and how do the gpos make27:49money from the hospital27:51um the members have to pay a membership27:54fee27:55so every hospital or health system has27:57to pay a certain amount to the the as as28:01members and they take like a two or28:04three percent of the volume of sales28:06between their contracted vendors to the28:08hospital members and and they take that28:11as their fee so they sort of skim off28:13two or three percent they're actually I28:16think three percent is by law the28:18maximum they're allowed to charge28:19there's literally a law about that28:23did that answer that question28:26I'll let I'll let Victor say that in the28:29chat and I appreciate Dan was also28:31asking about that how they make money so28:32thank you for addressing that really28:34quickly sure no problem28:37um leveraging your successes all right28:41cold calling is for rookies and28:43masochists I I think that would be a28:45great title for my book28:47cold calling28:49you know what 20 years ago cold calling28:51was the way you made sales the old sales28:54managers back in those days would tell28:56you if you want to make more sales you28:58got to make more cold calls29:00unfortunately in today's market a lot29:02fewer people except cold calls you're29:04going to have a much tougher time29:06getting through I think Sandler Sales29:07Training has done a few um surveys to29:11find out that in the what I call the29:13good old days if you're really good at29:15cold calling you get 30 you would get29:17through 30 of the time and strike out 7029:19of the time29:21but really29:22um today is probably less than 1029:24percent that you're going to get through29:25on cold calling so you're gonna make a29:27whole lot of cold calls for very few29:28results29:30referrals are the lifeblood of this29:32industry29:33and I want to talk more about that but29:35before I do you know if you're if your29:38sales process is to put a really Swanky29:41website up and hope people find it no29:44that's not going to happen in fact29:47um most of the clinicians are told to29:49not go shopping on websites websites are29:52just your electronic version of your29:55spec sheet29:56that the value analysis committee will29:59look at after you've done your30:00presentation because you get more30:03information about you from that but30:05that's only after you've been entered30:07they've been introduced to you it's all30:09a relationship game so you do need a30:12website you do need a really good30:14website and it's got to be informative30:16but don't expect to put a website up and30:18just have people come and flock to it it30:20isn't going to happen30:22so my 34 years of experience I know this30:25is still the way it is today30:26referrals of the lifeblood of this30:28industry every clinical manager knows30:30most of their peers in other hospitals I30:32learned this lesson from West Penn30:34Hospital and Mercy Hospital the two burn30:36units30:38West Penn Burn Unit began using my air30:40bed30:41then she told the unit manager told me30:43to call her friend who was a unit30:44manager of Mercy's Burn Unit30:46I got in there because I was referred30:49into30:49and after they the mercy Burn Unit30:53started ordering from me she ultimately30:55said you know you never would have got30:56to me if it hadn't been for my good30:58friend over at West Penn and I said yeah31:00I know31:01I learned that lesson in 1985. I haven't31:04made a cold call since 1985. I've been31:07leveraging the referral method ever31:09since this is really important there's31:11an art to asking for referral31:14start with your happiest customer you31:15only need one one happy customer31:19ask them31:21hey we had a very successful working31:24relationship yes great31:26um who would you like me to share that31:28success story with or who do you think31:31would want to know about the success31:33that we've enjoyed together it's a very31:36tactful question31:38when I ask that question I usually get31:40one or two referrals31:41and so then I would contact those people31:44be careful how you ask because if you31:47say hey got any referrals for me that's31:49a yes or no question and it's a little31:50off-putting if you say I need to build31:53my book of business you got anybody else31:54I can talk to again that's about me31:57right make it about them it's their31:59success in working with you32:01know they've had great success working32:03with your product32:04hey who else should know about this who32:06do you think should know about this32:08easiest question asked I'll tell you 9032:11of sales people don't ask for a referral32:13and so they get locked out32:16referral calls have a 70 acceptance rate32:18acceptance rate32:20that is my connection rate I as a sales32:23professional I track my connection rate32:25as well as my closing rate right and I32:28get a 70 acceptance rate by getting32:31referrals and I also have about a 90 8532:34to 90 closing rate I'll close everybody32:38but I close most people32:40I think the bottom line here is if you32:43if you do the referral method correctly32:45you will enjoy the same success I had at32:48my Granby medical because the very first32:50rule I gave every sales rep that I hired32:52so rule number one you're not allowed to32:54cold call it's a complete waste of time32:57I'm going to take you around to our32:58happiest customers and introduce you33:01we're going to find out who else they33:02think ought to know about what we're33:04doing with them33:05and we would come away with referrals33:06and we would contact those people in33:08other words this is my favorite saying33:10it's better to be a somebody that33:11somebody sends than nobody that nobody33:13knows33:16foreign33:18people I gotta tell you that33:22in the last 20 years we've tried many33:26different emails to try to get an33:27appointment and that's the hardest part33:29is getting that first time appointment33:31with a prospect33:34and I found this email to be extremely33:36effective okay just a real quick33:38overview33:40in the subject line I put the referral33:42sources name why because I want them to33:45open email I wanted to read my email33:46right if I put new technology33:49life-saving technology or whatever my33:51product name is33:52you're competing against a delete button33:54because they're inundated with those33:56types of emails so put the referral33:58source's name in the subject line then I34:00just put hello so and so I was referred34:03to you by your friend referral source's34:05name hey we're recently discussing the34:06success we've had working together and34:09your name came up during the34:10conversation34:11your friend suggested this give you34:12something you might be interested in34:14by working together we were able to we34:17were able to and then I described one or34:19two positive outcomes without mentioning34:22your pro my product34:24I want to I want to give you an example34:26I would put in here we were able to34:29help them manage their most difficult to34:31manage patients comply with Joint34:33Commission standards and reduce workers34:35comp injuries by more than 50 percent34:39now that was what I would put in there34:40but you notice I never mentioned what34:42the product was34:43it happened to be our bariatric34:45equipment and the equipment we use to34:47mobilize patients that were between 35034:49and a thousand pounds34:52another one I used was we helped reduce34:54accidental patient falls by 50 to 7034:57percent we help you reduce your legal34:59liability claims an accidental patient35:01follows the third most frequent lawsuits35:03against hospitals35:05but again I never mentioned the product35:06the product happened to be portable fall35:09prevention monitors35:11the next line is I don't know if this is35:13right for you or not hey that says we're35:16going to discover together right I'm not35:18expecting you to buy from me if it's not35:19right for you35:22and then I just say I'd like to give you35:23a call this Friday or sometimes I'll35:24send a calendar invite to set up a brief35:26call35:27here's the key I'd like to ask you some35:29questions yeah I'm inquisitive I'm35:31curious I'll share some information and35:33after that I'll leave it completely up35:35to you to decide if it makes sense to35:36explore any further I am giving them35:38permission to say no and I'm okay with35:41that35:42when I send this email out I would get a35:4570 response rate seventy percent of the35:47people I sent this to I would get an35:49email back saying I look forward to your35:51phone call35:53so35:54when you're referred you're part of35:56their inner Club35:58the hardest part is getting connected to36:01the people that you want to talk to36:02whether they buy from you or not is36:04their decision that's going to come36:05later during the sales process36:07but getting connected up front is the36:09hardest part36:12this has worked for me and every time I36:14try to tweak this email my success rate36:17goes down36:18so when I see people writing an email an36:21introductory email36:22with all their product specifications36:24and all this and that it's like okay36:26they're not going to read it okay this36:29one gets their attention and I am able36:30to make the connection I just want an36:32appointment36:33we'll figure out if it's right for them36:35to buy from me or not later but you36:37can't for anybody to buy from you if you36:39can't get in front of them36:44all right is there some questions in the36:46chat box36:51uh yes it looks like there's one36:52question on advising VAC on design of36:56trial of your product so can you advise36:59that37:01now I advise back on the sign design of37:04trial of You Yes actually37:06the way I did it was37:09um I would typically give them an option37:10I would say hey what's your what is your37:13evaluation process many of our Hospital37:15customers it's either two weeks or a37:19month which one do you prefer37:21they usually have a standard one and37:23it's typically not more than 30 days I'm37:26okay with two weeks I was okay with 3037:28days whatever their process was37:30however I wanted to control it to make37:33sure that it was on specific nursing37:34units not all over the hospital because37:36you can't manage that so37:38I would try to steer them towards two37:42maybe four nursing units at the most37:45the two or three was sort of Ideal37:47because you have to do a lot of training37:49on your product when it's first37:50introduced you have to follow up almost37:52every day during the evaluation at least37:54in the first week and you want to make37:56sure the nurses are happy with the37:57product because if there's a problem37:58with your product it's going to manifest38:00itself in the first day or two and you38:02want to be able to be on the on on site38:05in order to make sure that that gets38:07resolved because usually or not always38:09but sometimes it's user error but well38:11anyway yeah so you can work with them on38:14how you would like to see it done38:16and also meld in how they like to38:18normally do it and it's usually very38:20reasonable38:21um they're they're very reasonable if38:23they decide they want to go forward38:25they usually would ask me what's your38:27trial evaluation protocol oh thanks for38:28asking I appreciate that you know this38:30is typically what we do and they go okay38:32we can we can do that did that answer38:34the question that was a long answer38:36sorry Kevin I had a follow-up question38:39to that during these quality38:40improvements studies are you providing38:43the product at no cost to them38:46well there's uh you can do either way it38:49depends on what the hospital protocol is38:53and there's a little bit of a trap right38:55so let me let me answer it this way some38:58hospitals will pay some discounted rate39:00for an evaluation product39:03um some hospitals want it for free like39:05Cleveland Clinic wants your product for39:07free for a whole year so you want to39:09stay away from them in the beginning39:11um they're just they're out there the39:14the uh39:15the problem with giving them the product39:17for free is39:19they don't always value the free product39:23and as a result it might sit in the39:25corner in the nursing unit is supposed39:26to be evaluating it and they don't pay a39:28lot of attention to it so it's got to be39:31something either pay pay a portion of39:34the price so that they're committed or39:36you're going to have to work very39:37closely with the nursing unit to make39:38sure they're committed If the product is39:40for free so it's kind of it's not a39:43black and white situation it's whatever39:46you can make happen if that answers your39:49question yeah thanks39:52another question that came up were what39:54are the main purchasing decisions that39:56nursing is involved with as compared to39:59medical professionals or Physicians40:04um40:06what well I can answer that by saying40:09what are the top five issues for40:11hospitals in the value analysis40:13committee40:14one is treating bed sores number two is40:17preventing accidental Falls not in this40:19order a third one is reducing workers40:21comp injuries among health care workers40:24because40:25workers competentries among nursing40:27staff as 1.6 times higher than the next40:30worst industry which is construction40:31that's a really big one I think40:34medication administration you know wrong40:37administration of the right medication40:39and um or administering the wrong40:41medication I think that's one of them40:43so those were the ones that I heard of40:47um Physicians40:48you know what I'm not sure I can answer40:50that directly because we didn't really40:52sell to the doctors that much their main40:54thing I would believe is in Talking To40:57The Physicians that we did a good40:58relationship with you know they they41:00want quality patient outcomes they want41:03to make sure that41:04um they're doing everything they can to41:06get that positive patient outcome41:15you're going to win over the value41:16analysis committees41:18if you can improve patient care or you41:20can improve the patient's outcome that's41:22number one number two if you can make41:24the nurse's jobs easier41:27while improving Patient Care number41:28three if you can save41:30money for the hospital if you can reduce41:32the cost of caring for those types of41:34patients with your product or technology41:36if you do those three things41:38that's a home run for me and and that's41:41what we did and and I want to say that I41:44was you know I was honored and blessed41:46to be able to do that41:48if you are able to do those three things41:51I'm rooting for you because I want you41:53to be successful that's what the41:55hospital's overall goals are41:57and41:59I'll finish with what's your value42:01proposition right these are questions42:02that you you need to answer if you42:04haven't already42:06um what problem do you solve it's not so42:08much about what your product is all42:10about it's what what's the problem42:11you're solving42:13second question is how are hospitals42:14handling this problem now42:16Lucy income A supplier or what's this42:18what's the operating procedure that42:20they're doing right now42:22foreign how does your solution improve42:24the quality of care how does your42:26solution save on current cost42:27expenditures what's your differentiating42:29Factor if you have competitors out there42:31and you build a better mousetrap42:33what makes it different42:35I mean who are your competitors do you42:37know who they are these are questions42:38that I think42:40you may already know the answers to42:41those these are the questions I'd be42:44asking42:48all right I'm happy to take on questions42:50but before we do I just want to let you42:52know that if you want more information42:54this was a very high level overview42:57it was quick we had 45 minutes if you43:00want to know more information about any43:01of the topics that I covered please feel43:04free to reach out to me if there's a43:06topic you want to discuss that wasn't43:07included on this uh webinar you can43:10reach out to me I'm happy to talk to you43:12about what my experiences were because I43:15don't think you're going to run into a43:16specific situation that I already didn't43:19already encounter myself so I'm happy to43:22give you some additional insights I'm43:26happy to give you a free two-hour43:27consultation on any of these subjects43:29I'm I'm semi-retired okay but I am I'm a43:32big fan of bringing new medical43:34technology to Health Care improving43:36Health Care proving the nurses jobs43:38saving money and I'm here to support you43:41if I can43:43okay questions what other questions can43:45I answer for you43:47well first of all thanks so much Kevin43:49for that that talk here we have a couple43:51more in the chat43:52um so uh looks like Victor was saying43:55he's familiar with the viziant um as a43:57producer of nursing residency programs44:00but not as a GPO44:02um is it is the vision and mainly a GPO44:05or you speak further to that44:08um if I'm not mistaken busy was Med44:11assets and another GPO merged and coming44:14up and came up with that name yeah and a44:16lot of the gpos have additional Services44:19they provide in addition to negotiating44:22deep discounts from the vendors44:25so I'm not surprised by that and there's44:28been some changes uh with some of the44:30GPS there's been some mergers of gpos44:32there was a lot more44:3410 15 years ago44:36so there's been some consolidation and44:38additional Services as well yeah44:41and then the other example are44:44was to give an example of a business44:46related that went particularly well and44:49why and how that happened and then also44:52one that was Sour or yeah didn't go so44:55well and why that happened all right I44:59can give you a 90-second45:01um version It's West Penn Hospital and45:03Mercy Hospital the two burn units45:06um I called on Karen price unit manager45:08at West Penn Hospital45:10um when I got an air bed new to the45:13country came from the United Kingdom45:15called the meniscus bed45:17and when I met with her45:19I brought out my brochure like a rookie45:21sales rep I'm 25 years old you know you45:23you throw out your birth shorts you45:25start talking from it and she stopped me45:27she's oh my gosh I love this bed I said45:29how's that how's that even possible we45:32just got it in the United States it came45:34from the United Kingdom and she said you45:36don't understand I spent six months45:37working in a London Hospital this was45:39the year that we had not the clunky one45:41we have down the hall I didn't know this45:43was available I'm going to order45:44everything from you45:46perfect right you you live for sales45:48calls like that and after a month or so45:51servicing West Penn's Burn Unit she says45:54Karen says have you been over to Mercy45:56hospitals Bernie and I said ah because I45:59knew Burton Mercy Hospital Burn Unit and46:01West Penn Burn Unit were Arch rivals46:04I said no I haven't been over there46:05she's oh go see Shirley Lepore it's easy46:09in Imagine we're best friends we go to46:10all burn units together we room together46:12you got to go see Shirley so she writes46:14down the phone number and Shirley's name46:16on a sticky Notepad46:17so I go out to the hall and pick up a46:20pay phone back in the days when there46:21used to be pay phones and I called the46:23number46:24and a lady answers a phone she goes46:27hello this is Shirley well back then you46:28used to have to call into the the46:31um46:32the switchboard and ask for the unit46:34right46:36so I started talking you know I've got46:37this great new air bed and she started46:39screaming at me oh my God what are you46:41an air bed salesman and um I literally46:43was holding a phone out this far she was46:45screaming at me and then suddenly she46:47stops and she said hey wait a minute46:48how'd you get this phone number what was46:51her private back line into our office46:54and I said well Karen Price gave it to46:56me she said Karen gave you my number I46:58said yeah she said is Karen using you I47:01said yeah you'd be in my office at 1047:02o'clock tomorrow morning she's hung up47:04on me and I show up 10 o'clock the next47:07day right47:08I get in and unit manager has an office47:12in the Burn Unit so you have to hit an47:14intercom and the secretary comes out he47:17said can I help you I'm here to see47:18Shirley the poor here's my business card47:21and she starts laughing at me this47:23Shirley doesn't see sales reps so I47:25think there's a mistake here so no she47:27told me to be here at 10 o'clock so I go47:30in and surely nice as could be47:33have a seat thank you for coming on such47:35short notice tell me all about your47:37airbag and I start talking a little bit47:39about he says no no I don't care what47:40you like about it I want to know what47:42Karen likes about it no here's the three47:45things that Karen raped about because47:46that's good enough for me if I order for47:48me how soon can you be here that sales47:50call lasted maybe seven minutes47:53when I left47:54I wasn't even back the office 30 minutes47:56later and she called a place an order47:58with me all right those are the good old48:00days48:01not only that she she replaced all the48:04other air beds that she didn't like use48:06mine and then she started tiling all the48:09other unit managers in the hospital to48:11order from me so next thing I know I'm48:13getting order some unit managers and48:15different nursing units in Mercy48:16Hospital that I had never even visited48:18yet48:19and I say I know I have more air beds in48:22Mercy Hospital than any of my other48:23accounts and Shirley's the only one I48:25made a call to48:27and then I got the famous call from48:29purchasing agent saying who are you and48:31how'd you get in my hospital that's48:33another story but that's probably my48:35favorite story about leveraging48:37referrals and I would never have gotten48:40to Shirley if it had been introduced by48:42Karen so that's one of the best48:45okay you asked about the worst one48:48Conemaugh Hospital I'll just use their48:51name okay48:53um we ended up getting a contract from48:55our competitor the economow and this in48:58the uh49:00uh49:01Central Sterile Supply49:05honestly God she was just sabotaging49:08everything we were trying to do49:10well we found out that her nephew worked49:13for the competitor whose contract was49:15canceled and her nephew was out of a job49:17and she was not happy with us49:20similar thing happened down in West49:22Virginia where the sales rep for our49:25competitor in the hospital should not be49:28named49:29um was the cousin of the purchasing49:30agent and he wasn't about the less even49:33with our GPL contract he wasn't going to49:35let us take her business so we got49:37locked out of that for a while we49:39eventually got the business49:40it was after his cousin left the company49:43that we competed against these are49:44things that happen okay it's unfortunate49:48um49:49but it is what it is you live with it I49:53don't know if that answered your49:54questions49:57I got a million stories if you want to49:59hear them you can always talk later50:03any other questions50:05so cool50:08you go into these value analysis50:11committee presentations is there like50:14kinds of evidence that50:17you just shouldn't talk about like you50:19know I don't know if you've given my50:21journal article or you tell them about50:23your their competitors you know quality50:26analysis study or is there stuff that50:28you should or shouldn't present as in50:31terms of types of evidence50:34well50:35um I think50:37five things50:39that I always like to see fax figures50:41data context and perspective right50:45I also don't believe in50:47um50:47dissing your competition I always like50:50to say50:51you know who are you using oh that's a50:53great company and that's a very good50:55company we're a very good company too50:56that's just the level the playing field50:59and then really focus on what made us51:01different okay51:04um and and I think stories51:08do a better job of selling because you51:11can relate these these people these are51:13human beings that are making this51:14clinical decision51:16and decisions buying decisions are kind51:19of emotional if you know what I mean and51:21they use logic to support their51:23emotional buying decisions if you share51:25stories of successes that you've had51:27with other hospitals or facing the exact51:30same situation here's what they were51:32that's third party success stories I51:34would heavily weigh your presentation on51:37that I would heavily weigh your51:38presentation on what the feedback was51:40that you got from the interviews that51:42you conducted with each of the committee51:45members51:46um51:47because they can always get your stats51:50and your in your specs from your website51:52or your brochures that you leave behind51:54did that answer your question yeah yeah51:59it looks like there's another question52:01that came into uh do you have a strategy52:03for researchers in the development phase52:05to reach the back before the product is52:07ready for sales and is it appropriate to52:10set up a relationship before the startup52:12is formed52:15it's a great question if I were to do it52:21if I were to do it52:23um I would take it to somebody that I52:26know or somebody that knows somebody52:28just to ask so this product is in52:31development this is what it's going to52:33be designed to do this is the problem52:35it's designed to solve52:38what are your thoughts what do you think52:42um if you and and you can an easy way to52:46do that is to go to a trade show52:48whatever a local trade show is52:51that is specific to what that product is52:53where that product is going to be used52:55in the hospital I go to the trade show I52:58just talk to some people there whether52:59you have a booth or not53:01um it would be better if you well if you53:03don't have the product yet then you53:06probably would want to talk to a few53:08people on the side whether it's at just53:11ask for a you know 30 minutes of their53:13time they do a lot of speed dating these53:15days in these these um these trade53:19associations where you know there's53:20vendor booths but there's also speed53:22dating tables that would be a great53:25opportunity to have a conversation like53:26that and then hey my favorite question53:30is hey if you wear my shoes what would53:31you tell me what would you do next tell53:33me what you would do and they usually53:35paint a clear picture for what they53:37think you should be doing next53:40is that helpful53:49excellent53:52all right so we'll go ahead and just put53:55your email in the chat as well so53:57everyone can copy that down a few of53:58additional questions54:00um for Kevin and I'll also put in some54:03information in the chat as well to keep54:05you know stay tuned for more information54:06for next month's seminar and we hope to54:09see everyone there so thank you so much54:11again Kevin for a great great talk about54:13all of this and we really appreciate54:15your time today54:17thanks for having me I know it was like54:19drinking from a fire hose but hey it is54:22what it is right thank you very much54:26that was awesome thank you
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