By Jenny Lower
Founded in 2001, Ultra Solutions in Ontario, Calif, describes itself as one of the largest preowned ultrasound businesses in the industry. Following a purchase by Salt Creek Capital, a private equity firm, in 2013, experienced executive Sterling Peloso stepped in as the new president, CEO, and co-owner. 24×7 touched base with him recently to learn how the company is evolving and what he has in store for the months ahead.
24×7: You’re relatively new to Ultra Solutions and ultrasound. How did you get there, and how has your previous experience informed your approach to healthcare?
Peloso: Over the last 15 years, I have held positions as a general manager, vice president, and CEO for primarily B2B services and consumer products organizations. Our key growth vertical at most of these companies was healthcare. Not coincidentally, many of the same healthcare organizations and GPOs at Ultra Solutions were my clients and customers in the past. My 20 years of experience with PepsiCo, ARAMARK, Quartermaster, and Iron Mountain prepared me well for this opportunity at Ultra Solutions. All of these great organizations gave me an opportunity to develop a strategy to grow my business, build customer loyalty, and also a chance to hone my leadership philosophy. My goal for the last few years was to purchase my own company. I was able to achieve this goal by partnering with Salt Creek Capital to purchase Ultra Solutions in September 2013.
24×7: What do you see as the main strengths of Ultra Solutions?
Peloso: Not coincidentally, our team recently went through a SWOT analysis as part of our strategic plan. Our top five strengths as an organization are as follows: 1) employees—a driven, passionate, motivated team; 2) technical expertise—within every department we have ultrasound industry subject matter experts; 3) customer care—every employee is focused on delivering the highest-quality products to our customers every day; 4) inventory—unlike most competitors, we carry a significant inventory with typically 300 systems and 3,500 probes in stock; 5) probe repair—we are one of a few full-service probe repair companies and just added TEE repair capabilities.
24×7: What are the biggest challenges facing the company?
Peloso: Our greatest challenge as an organization remains branding Ultra Solutions to our customers and educating them on our capabilities. Having just returned from Arab Health 2014 and RSNA, I found myself having to still answer the question, “What does your company do?” I believe if collectively we are able to share what our industry has to offer, we could help the healthcare industry save money without sacrificing quality. We have been successful at educating prospects and customers by sharing our rigorous quality assurance process through videos, on-site demonstrations, and virtual demonstrations. Realize that we close most of our sales without ever seeing a customer face-to-face. For every system or probe we send no less than 10 photos, screen shots from the system, and quality assurance tests to give them peace of mind that they are getting a great-quality product.
24×7: How will the acquisition by Salt Creek Capital affect Ultra Solutions going forward?
Peloso: I believe that Salt Creek Capital will give Ultra Solutions increased support and guidance that will give us unlimited potential for success in the future. Unlike most private equity groups, Salt Creek Capital is a private equity sponsor that helps bring together the executive partner (me) with a company that is a good fit. In the end, aside from the financial support, it is up to the executive and the organization to help the business reach its potential. Having worked with other private equity organizations, Salt Creek Capital is unique because they give me the autonomy to be successful.
24×7: How has the Affordable Care Act affected the company’s business?
Peloso: The Affordable Care Act has already had a very positive effect on our business. Because healthcare providers are mandated to be more efficient, they are looking to companies like Ultra Solutions for quality ultrasound systems, probes, and parts at a value. In addition, these same customers can’t simply write a purchase order to buy a new probe from an OEM as they have in the past. Not long ago, if a hospital or imaging center had a dysfunctional probe or any equipment, they would simply contact procurement and order new from the manufacturer without regard to price. These same organizations are now being asked to do more with less money. Consequently, a business like Ultra Solutions that offers 50% to 60% off the OEM price for the same probe or system is an attractive choice. In addition, we are seeing a dramatic increase in the growth of our probe repair business. Over the past 3 years, we have built one of the few world-class probe repair operations in the United States. To make the process even easier, we established www.proberepair.com, which allows our customers a simple process to ship their probe in for service and even identify potential loaners. Finally, the Affordable Care Act has helped us secure some big GPO wins with Health Trust and MedAssets within the past 60 days. These are two of the largest and most respected healthcare GPOs that have validated the need and desire for quality refurbished equipment in the medical community.
24×7: Ultra Solutions does business around the world. What are the key differences between the international and the domestic business?
Peloso: We are fortunate to have a talented and experienced group that understands every market around the world. The key to our success growing internationally is our quality products, quality assurance documentation, and customer care. Our international customers have come to trust Ultra Solutions because of our integrity, responsiveness, and the relationships developed. One noticeable difference with international customers, as compared to our domestic clients, is the value that they place on the relationship. To build our international business required much more time, face-to-face meetings, and conference calls. In addition, internationally, the markets in specific regions tend to be much more price-sensitive than domestic customers.
24×7: What plans does the company have for future growth?
Peloso: As an organization, we are in the midst of defining our short and long-term strategy. As we continue to change and evolve, our focus will always be on providing world-class quality and customer care regardless of additional markets, services, or products. As part of the process, in November we asked our customers to give us feedback on Ultra Solutions performance and also products and services they would like us to provide. We received great ideas and also a 93% customer satisfaction rating. I am excited with the team in place and believe that our future is unlimited.
Jenny Lower is associate editor for 24×7 magazine. Contact her at [email protected].