by Keith Loria

Note: This report originally appeared in the October 2008 edition of DOTmed Business News. A list of registered users that provide sales & service can be found at the end.

Take a gander at the auctions around DOTmed.com and it's pretty easy to understand why the used medical parts industry is a multi-million dollar business. With thousands of brokers, dealers and specialized companies offering parts for just about every piece of equipment, getting a part from a third-party source can be as simple as a click of the mouse. Even the OEMs get in on the act, as evidenced by the multitude of parts that GE has sold over the years by utilizing DOTmed auctions.

While it may seem practical to buy replacement parts from the original OEM, often they don't have what's needed for their older equipment and the third-party suppliers offer used parts for a fraction of the price that you would pay purchasing a replacement part.

That's why business is booming for just about every used parts dealer or broker around.

"The advantage is that this is a lower cost way of maintaining equipment, otherwise the expense can be pretty astronomical for some of these things," says Patrick Helms, Operations Manager for Troff Medical Services. "It's a cost-saving alternative. With the current economy everyone is feeling the crunch, even the large hospitals, and everyone is in a cost effective frame of mind to trim the fat a little bit. We can help people maintain their equipment at a far more reasonable price."




The Hendersonville, NC-based Troff Medical Services has over 20,000 parts in inventory in its 17,000 square-foot warehouse and by offering the parts at savings of up to 65 percent from the listed prices of new parts it has seen its business grow in each of the past few years.

That's also true for C&G Technologies, Inc., whose parts number are on par to beat last year's entire numbers by the end of September.

"Business has been great," says Wayne Kramer, VP of customer operations for the Jeffersonville, IN-based company. "Everyone is looking to keep parts costs down and help the health industry and hospitals save money. That's why the business is so successful."

Plus, with government cutbacks on reimbursement and the economic crunch hitting so many in the medical field, many hospitals and imaging centers aren't turning to newer equipment too often these days. By hanging on to their older systems longer, things are more likely to break and replacement parts are needed more often.

"The hospitals and clinics haven't been buying the new equipment as fast as they used to due to the cuts," says Jeremy Probst, Operations Manager for the Greenville, WI-based Technical Prospects LLC. "Equipment is holding up longer and holding value for a greater period of time. Facilities won't have the newer equipment and need a company like ours to keep their equipment up and running."

Competition is Fierce

Even with the significant savings they offer customers, parts suppliers face tough competition in a crowded market. That's why respect for the customer is key.

"Medical imaging will continue to see companies come and go. Of prime importance to survival is customer service," says Bruce Smith, VP Multi-Vendor Service for Sonora Medical Systems in Longmont, CO. "Listen to the customer so you provide what the customer needs. This includes making sure you are supplying a top quality part that works when it arrives at the customer site, and providing the technical expertise to trouble shoot to get the customer to the right part or help the customer through any issues with installations."




Russ Hall, Manager of Technical Operations for TN-based ReMedPar, the world's largest independent provider of replacement parts for diagnostic imaging equipment, believes that the battle for customers comes down to two things.

"Competitive price and quality of the parts," he says. "Everyone wants to sell a part so if you are lucky enough to get the phone call, and sell a part, you better make sure that you are providing the customer with the best service you can."

Of course, the more companies fighting to sell you the same items, the better it can be for the end-user. Prices do come down and customer care does increase.

"When it comes to survival, it really comes down to offering quality," Helms says. "We spend a lot of time field testing these units before they are removed. We buy from hospitals that we know, brokers that we know. We know how the stuff was used and only buy good quality equipment. We go through a lot to ensure everyone is happy with the transaction and happy with the parts. We'll follow-up with the end users that they received it and everything is to their liking. We try to make them happy."


Specialization is Key

When it comes to parts providers, there are some dealers that concentrate all their interests on one particular modality or even one OEM brand of equipment.

C&G Technologies specializes in CT parts for GE and Toshiba systems and have over 10,000 parts in stock for customer needs.

"Way back in the beginning, our company made the decision that instead of trying to do everything and not excel at anything, we decided to stick with a certain product and be the best at it," Kramer says. "There are a lot of people out there that list out everything-all parts, all modalities-but what happens is they aren't really familiar with any one piece of equipment in an extreme level of detail. They can't give 81 things an extreme level of detail. All of our people specialize in CT and that's made us the best at what we do."

JDI Solutions does 99 percent of its parts business dealing with Siemens MRI and their 7,500 square-foot warehouse will be doubled by the end of the year to provide additional inventory space - a good indication as to how healthy sales have been.

"We have seen a dramatic spike returning us to historic highs as we have increased every month since April," says Clark Wilkins, President of JDI, in Brevard, NC. "We believe it's because of our confidence and competence levels. We went on a more aggressive advertising campaign and have a great relationship with DOTmed.com."




Currently with over 2,300 parts for Siemens MRI equipment, JDI puts each one through a strict quality control program, which gives them confidence to offer a six-month warranty on all parts.

"We get the parts up to OEM performance specifications," Wilkins says. "Our emphasis is to have the phone ring as little as possible with complaints."

Technical Prospects LLC also focus mainly on Siemens imaging equipment and parts, with Probst's dad a former 16-year employee with Siemens as a service engineer.

"Specializing in Siemens seems to work for us and I think it helps having a niche market as it identifies who we are," Probst says. "We don't have everything, and people know we only have Siemens parts and that gives us a market edge. A lot of companies try to do everything and that's not our focus at all. I think some other parts companies may get lost because they do so much and people might forget what they offer. We felt it was better to focus on just Siemens."

They currently have 8,000 square-feet of inventory but because of increased growth, will soon be moving into a 60,000 square-foot company headquarters, with 20,000 of that designated for parts.

"Our business has been good and we are still increasing," Probst says. "We had some niche sales last year that made up a certain percentage, but we mainly focus on what we can do best."

Only in their second fiscal year, the Pompano Beach, FL-based Platinum Medical Parts LLC decided to use their imaging expertise to concentrate solely on GE MRI parts and in the words of company president Jeffrey Fall, "We are booming."

"My partners and I had been in the imaging business for years and years and we got to the point where we were saving all this stuff and we decided to seriously start acquiring parts and get into the business," Fall says. "We really try to give our customer a higher level of service. We have engineers answer the part calls to make sure they are getting the right parts and can answer any questions that need to be addressed. Unless we find that same expertise for other modalities, we won't be branching out yet."


A Whole Lot of Parts

For the past seven years, PartsSource has laid claim to being the nation's only multi-manufacturer, multi-modality alternative parts supplier supporting both imaging and biomed parts requests for hospital equipment. They further assert that they are the only company to offer parts support for all 2,500 separate makes, models and modalities of hospital equipment.

"PartsSource is unique in that we don't specialize in one particular modality or manufacturer. As a matter of fact, we like to say our specialty is that we don't have one," says Don Hubbard, Senior VP Sales & Marketing. "We sell $50 parts to the technician working on infusion pumps and we sell $50,000 parts to the technician working on an MRI. Because selling parts is all we do, our total focus is on enhancing our ability to deliver high quality parts to our customers faster and at a lower cost than anyone else."

ReMedPar was founded in 1987 and has spent the past two decades becoming the largest independent provider of medical diagnostic imaging parts in the United States.

"I believe we have thousands of parts with an inventory of $23 million, so we have a pretty large inventory," says Hall. "We have an extensive business relationship with many suppliers and we can source as well."

While many of the smaller companies can't offer quite the same variety, a number of them do try to stock up on anything and everything that they can get their hands on.

"Our parts come from leased equipment that we will remove from a hospital or facility looking to get rid of it," says Josh Glas, Parts Manager for Brooklyn, NY-based Adam Medical Sales Inc. "We break all equipment down into its components and store individual parts for all modalities."

Glas recently put all his efforts into creating a real-time data base that lets him tell customers within seconds if he has the part they are looking for. Unlike a lot of other companies, if he doesn't have it, he won't get it.

"A lot of companies will do outsourcing if they don't have it, but I will only sell what I have on my shelves and that save my customers a lot of money," he says. "We have 16,000 unique parts and I am devoting myself to acquiring newer equipment to add to the inventory."

By providing parts for all nuclear medicine and X-ray equipment, Irvine, CA-based NCI has realized double digit growth year after year.

"NCI is a full service provider of all OEMs Gamma Cameras and we refurbish full systems as well," says company COO Alex Sapp. "We have over 15,000 parts in stock and have a very strong rapport with Siemens, GE and Philips, providing de-installation logistics, multi-vendor parts procurement, and training/technical support to the OEM Field Service Engineers."


More Than Finding the Part

Many of the companies have significant technical expertise and are able to do extensive testing and repair and refurbish parts. This often gives them a leg up on their competitors because they can offer longer warranties and in most cases, provide service as well.

"Unlike many other parts sellers, we repair most of the parts we sell and have an in-depth knowledge of the service aspects of the CT Scanners," says Carl Frank, Owner of Chino, CA-based DBRS Medical Systems, which has over $3 million in CT scanner inventory. "We provide service as well as parts. We also install, deinstall, and service existing systems. Some replacement parts are no longer available from the manufacturer so we have employed local machine shops to manufacture these parts for us. Typical items are high voltage insulators, motors, and power supplies."

Some parts companies are huge operations, such as ReMedPar, considered the supplier to suppliers, providing parts to in-house hospital engineers and ISOs. Currently ReMedPar has 45 Quality Assurance Bays in a 110,000 square-foot facility.

"We build our inventory through systems that we break down, do testing on every part that comes into our test bays and repair them when necessary and then resell them," Hall says. "Through testing, we can assure that a repaired part is fully functional before it leaves our facility."

Carl Hoffman, President of the newly named First Call Parts (formerly BRMI) of Salem, VA is offering 6-month warranties on all parts sold.

"Few companies are doing that but we can be that confident because we have systems pre-staged, we have field engineers that can test and properly repair the parts and we spend millions of dollars buying systems and testing equipment so we can really do this correctly," Hoffman says. "A lot of companies go to de-install equipment, but that doesn't mean it is 100 percent functional. There are a lot of parts to these machines and some use 4-5 different functions but the customer may not be using all the functions and it might not work. We feel strongly about testing. We're doing our best to test as many functions as possible."

C&G Technologies have eight staging bays in their facility used for system testing and refurbishing, but are in the middle of an expansion that will see that number grow to 20 staging bays.

"We test our parts on complete CT systems and we also have a full inventory that has been tested and are now in a climate control atmosphere, static bagged, protected from dust on custom built shelves," Kramer says. "Everything is tagged, barcoded and logged through our data base system so we know the test results and any repairs or movement the part has been through."

There's no denying that these extra offerings that the parts companies have make them more attractive to hospitals and image centers looking to form solid relationships.

"I believe that the parts harvesters will, in the long haul, have a tough time competing with the companies that have the ability to test and repair parts," Smith says. "You can only harvest until the crop is gone. By repairing parts Sonora knows we are supplying a top quality part, and can continue to re-plant the crop. A part harvested from a working system may or may not meet the specifications for that part. The ability to know the part meets specifications, not just functions, differentiates the concerned supplier."


Finding it For You

PartsSource helps its suppliers with an internally developed and patented application called "PartsFinder 2.0." Through utilization of this system its 200 plus associates can quickly and efficiently capture parts requests on line, scan their warehouse inventory for available stock and, if unavailable in-house, go to the best vendors on the open market to secure pricing options for their customers.

Block Imaging International Inc. has access to over 30,000 parts throughout the U.S. and has seen upward growth due to the ability to quickly respond to the market's needs.

"We begin with a search of our inventory then reach out to our worldwide parts network to ensure customers get competitive pricing and fast response," says Marketing Manager Krista Kotria. "Our worldwide network allows us to offer a wide variety of complete systems and parts as well as support for even the latest technology."

A company like Aurora, OH-based Express Systems and Parts Network Inc., functions as both a dealer and broker.

"We have parts at our warehouse but we also source," says Senior Account Executive Chris Reeder. "If a customer calls us and we don't have the part they need, we will try to get it from someone else. We source about 30-40 percent of our business right now."

When they do source a part, they will do all the work for the customer, providing them with pricing, warranty information and make sure they are aware of all the options.

Although companies would love to have every part their customers need, almost all companies will source out a part at some point to keep good relationships with existing customers.

OEMs Play a Role

While some OEMs may have a negative attitude towards parts providers, they do realize that third-party sources have a place in the market and even use them themselves from time to time.

After about seven years, the original equipment manufacturers typically discontinue support and parts production for their older equipment yet they still may have service contracts with hospitals covering a broad range of devices, including older machines and those made by competing manufacturers.

"We do work with the OEMS for the multi vendor programs and have good relationships with the OEMS," Hoffman says. "We sell them support parts they may not have. All the OEMS have multi vendor where they work on the systems of other OEMS so they buy from a lot of different parts companies."

Ultimately, hospitals, OEMs and dealers all look to used and refurbished parts for the same quality and value.

"Our relationship with every OEM is great. Our philosophy is to work with them, not against them," says Dan Moretti, COO of Chino, CA-based Multi Imaging Systems. "We have seen upward sales trends based on certain moves or changes the OEMs make with regard to the products we sell."

According to Reeder, Express Systems and Parts Network also have a strong working relationship with several OEMs providing replacement diagnostic imaging parts and equipment, plus de-installation service.

Future Happenings

Except in rare cases, none of the parts companies can get their hands on any of the parts necessary for some of the newer equipment so the OEMS do have a stranglehold on those items.

"Usually by the fourth year, equipment gets traded in and those parts start to become available," Hoffman says.

According to Hall, it's important not to get too comfortable with your inventory and keep an eye on what's happening throughout the industry if you want to continue to be strong in the parts business.

"It's all about technology and staying on top of what's out there," Hall says. "A lot of things now are moving to X-Ray digital detectors and digital systems and we need to be prepared for that technology."

"Don't become obsolete, stay on top of new product offerings and technologies and make informed, intelligent estimates of what future demands will be," Smith says. "No one can precisely predict the future, but the companies that grow will be the ones that are best at predicting."

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DOTmed Registered Medical Equipment Parts Sales and Service Companies
Names in boldface are Premium Listings.

Domestic
Carl Frank, DBRS Medical Systems, Inc., CA
DOTmed Certified
-CT Scanners
Dan Moretti, Multi Imaging Systems, Inc., CA
-All Imaging Equipment
Alex Sapp, NCI, CA
DOTmed Certified/100
-Nuclear Medicine, X-Ray
Mahdi Ganai, Technitron International, Medical Systems Engineering, CA
-All Imaging Equipment
Anja Mannzen, The MedWarehouse, CA
-SYNTHES Orthopedic and General
Dan McGuan, Viable Med Services, Inc., CA
DOTmed Certified/100
-MRI and PET
James J. Donoghue, MDLabServices, Inc., CA
-Diagnostic including Chemistry, Hematology, Electrolytes
Jack Donovan, Broadwest Corporation, CO
DOTmed Certified
-Mammo
Shawn Bryant, Echoserve, CO
-Ultrasound, Mammography, Patient Monitors
Elmer J. Ruder, Nova Technologies, Inc., CO
DOTmed Certified
-Diagnostic Ultrasound Equipment
Glenn Smith, Gamma Systems Services, CO
DOTmed Certified
-Nuclear Imaging Systems
Bruce Smith, Sonora Medical Systems, CO
DOTmed Certified/100
-MRI, Ultrasound, Mammo
Robert Goldman, D & C Electronics, FL
-All Imaging Equipment
David Denholtz, Integrity Medical Systems, Inc., FL
DOTmed Certified/100
-All Imaging Equipment, Bone Densitometers
Peter Ehrlich, Health Care Exports, Inc., FL
DOTmed Certified/100
-All Imaging Equipment
Paul Aagaard, 5 Star Imaging, Inc., FL
-X-Ray & Imaging
Woody Peters, Amber Diagnostics, FL
-CT, Mammo, and C-Arm
Bill Adkins, National X-Ray Corporation, FL
DOTmed Certified
-GE CT, GE and Philips Cath/Angio, and ATL/Philips Ultrasound
John Necaise, CBC, Inc., FL
-Laboratory, (Sysmex Hematology, Hemostasis, & Urinalysis), Roche Omni Blood Gas
Jeffrey Fall, Platinum Medical, FL
-GE MRI
Gregg Pearson, MagnaServ, Inc., FL
DOTmed Certified/100
-GE MRI and CT & Other Brands
Ken Kirby, Aneserv Medical, Inc., GA
DOTmed 100
-Anesthesia, Oxygen Blenders, and Biomedical Equipment
Randy Cox, MRI Technical Services, Inc., GA
-MRI
Sherman Weston, U.S. Imaging, Inc., GA
-Ultrasound
Todd Muhlestein, National Deinstall & Refurb, ID
-Philips Cath Lab and R&F Room
Floyd Rowan, MEDX, Inc., IL
DOTmed Certified
-SPECT Cameras, PET and PET/CT
Wei Zhang, Advanced Medical Equipment, IL
-All Imaging Equipment
Josh Robison, Novatek Medical, IL
DOTmed 100
-Infusion, Pulse Oximetry, Patient Monitoring
Craig Palmquist, Genesis Medical Imaging, IL
-CT & MRI
Paul Larson, Beacon Surgical, IN
-Surgical Lights and Equipment Managers
Greg Kramer, C&G Technologies, IN
DOTmed Certified/100
-CT Scanners & Tubes
William Montgomery, Bed Techs, Inc., IN
DOTmed Certified
-Bed Parts
Colin Grady, Ambassador Medical, IN
DOTmed Certified/100
-Ultrasound
Christopher Turner, C&C Medical Solutions, IN
DOTmed Certified/100
-Ultrasound
Grant Norris, Med Equipment Service, KS
DOTmed Certified
-Nuclear Medicine and Ultrasound
Mark Ardoin, Omni Imaging Service, LA
-GE/OEC Cysto and C-Arm
Andre Camel, Medical Logistics, LLC, LA
-All Imaging Equipment
Richard Szeglin, Huestis Medical / ARI, MA
DOTmed Certified
-R/F, X-Ray, Rad Room
Kevin Bresnahan, BaySide Technical Services, MA
-Sterilizers- Autoclaves
Krista Kotrla, Block Imaging International, Inc., MI
-All Imaging Equipment
Nevin Durgin, Health Service Partners, Inc., MN
-All Imaging Equipment, Mammo
Richard Maynard, USA Medical International, MT
DOTmed 100
-Ultrasound
Clark Wilkins, JDI Solutions, Inc., NC
DOTmed Certified/100
-MRI
Edward Soto, SterilMed's Scope Exchange, NC
-Flexible & Rigid Endoscopy, Power Surgical Equipment
Patrick Helms, Troff Medical Systems, NC
-All Imaging Equipment
Rick Sagadin, Carolina Medical Parts, NC
DOTmed Certified
-MRI Coils and Parts
Marc Fessler, Independence Cryogenic Engineering, NJ
-Cold Heads for MRI
Scott Mancini, Martab Medical, NJ
-Respiratory, Anesthesia, and Hematology
Josh Glas, Adam Medical Sales, NY
DOTmed Certified/100
-All Imaging Equipment
Marc Todd, MedParts Direct, LLC, NY
-All Imaging Equipment
Cherna Wyttenbach, Today's Acrylic Mfg., NY
-Mammo, Compression Paddles and Accessories
Anthony Guzenski, Radtech, Inc., NY
-CT
Fred Morgenstern, Mini C Sales, NY
-Mini Fluoroscope
Don Bogutski, Diagnostix Plus, Inc., NY
DOTmed Certified/100
-Nuclear Medicine, SPECT, PET
Chris Miller, Zoetek Medical, NY
DOTmed Certified
-Cardiology, Physical Therapy, General Biomedical
Don Hubbard, PartsSource, OH
-All Imaging Equipment, Multi-vendor
Steve Stepanski, Express Systems and Parts Network, Inc., OH
DOTmed Certified/100
-All Imaging Equipment
Mark Reep, KLC Services, Inc., OH
-CPM Devices
Kenneth Saltrick, Engineering Services, OH
DOTmed Certified/100
-X-Ray, MRI
Vincent Tecce, National MRI Parts & Service, PA
-Hitachi MRI
Russ Hall, ReMedPar, TN
-MRI, Ultrasound, Mammo
Doug Updike, Priority Medical, TN
-Ultrasound Equipment, Transducers, Probes
Wanda Legate, AllParts Medical, TN
DOTmed 100
-Cath, R&F, and CT
Geoffrey Loveless, JLJ United, Inc., TX
DOTmed Certified
-Cosmetic Lasers
Lee Kelly, American Allied Nuclear, TX
DOTmed Certified
-Nuclear Medicine and PET
Robert Griffith, Robert G Griffith, TX
-MRI
Michael Webster, Legacy Medical Imaging, TX
DOTmed 100
-CT and MRI
Adam Adame, O2 Connection, TX
-Oxygen Concentrator
John Crownover, Laser Scientific, TX
DOTmed Certified
-Lasers
Steve Bush, Blue Ridge Medical Imaging, VA
DOTmed Certified
-All Imaging Equipment
Carl Hoffman, First Call (formerly BRMI), VA
-All Imaging Equipment
Steve Beno, Sterilizer Services, Inc., WI
DOTmed Certified/100
-Sterilizers, Washers, Exam Chairs
Jeremy Probst, Technical Prospects LLC, WI
DOTmed Certified/100
-All Siemens Imaging Equipment

International
Horacio Jose Gomez, VCG Imagen SRL, Argentina
DOTmed Certified
-CT, MRI, SPECT, RF and Magnet Shielding
Gustavo Adolfo Castano, KService, Argentina
-Laser Cameras, PACS
Jorge Sandi, Icys Medical, Bolivia
-CT, MRI, X-Ray
Claude Coelo, Coxray, France
-CT, MRI
Sanjiv Goyal, RadMedical, India
-CT
Niranjan Kumar, Indiaultrasound, India
DOTmed Certified/100
-Ultrasound and Color Dopplers
Shekhar Chand Jain, Emsons Imaging, India
-GE CT Parts and Hitachi MRI
Jagesh Saxena, Hitech Medical Systems, NY
-Ultrasound
Piero Baesso, Over Systems SRL, Italy
DOTmed Certified
-CR, Printers, Mammo, Interfaces, Cassettes, Accessories
Jamal Bazzi, Bazzimed, Lebanon
-All Imaging Equipment
Nasir Hameed, Right Choice Enterprise, Pakistan
DOTmed Certified
-Ultrasound, Dopplers & C-Arm
Peter Crosbie, PCRS Medical Imaging Services, United Kingdom
DOTmed Certified
-Ultrasound Transducers

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