Marketed Products: Sales Force Planning

Assessing the impact of durable medical equipment purchasing on field sales force sizing

Business Challenge

A mid-size device company focused in the pain management and rehabilitation spaces was failing to maintain its traditional strong growth. Anecdotally, the client was hearing that physicians were increasingly choosing to stock and bill some durable medical equipment (DME) themselves (i.e. DME reseller programs) in order to boost practice revenue. Our client's sales force had traditionally served that function for the practice. Our client needed to understand the dynamics of the market, assess the rate of paradigm shift in DME distribution and billing, and determine how to adjust its sales force.

MedPanel Approach

We conducted an online discussion among fifteen physicians and surgeons in client's primary customer segments to understand the dynamics of the market, the context, and the perception of the customer. Additionally we uncovered the major drivers of and barriers to change regarding DME reseller programs. Armed with this understanding, we then conducted a survey to determine the transition rates from traditional to DME reseller programs for the client's five major product lines including TENS/electrotherapy and spinal bracing. With these transition rates in the recent past and forecasted into the future, combined with financial data from the client, we projected the magnitude of future drop-off in revenue if the company continued to only support a model in which the products were fit and billed for by the company's representatives.

Results & Impact

Armed with robust data on transition rates and concomitant potential revenue losses, our client adjusted their strategic plan to get out ahead of the market. Stated the CEO: "Your research inspired a new business unit and fundamentally changed the way we do business."