In 1994, Troy Powell and his wife, Debbie, dipped into their personal savings to found Ardus Medical, Cincinnati, out of the kitchen of their home, selling and renting used infusion pumps and defibrillators to various medical markets. Since then, the company has experienced tremendous success and has grown to include 13 service centers across the United States and more than 80 employees. Today, the company provides refurbished medical equipment to customers everywhere from its main 10,000-square-foot Blue Ash, Ohio, facility. 24×7 recently spoke to Chuck Brooks, Ardus’ vice president of biomedical development whose position is customer focused, about dramatic cost savings, what the FDA expects of replacement parts companies, and why the company still believes in milk runs.
24×7: Is Ardus currently focusing a lot on pricing and pricing structures?
Brooks: I think that everybody is. We’re all looking at how to optimize maintaining devices and patient safety, and how we can make devices last longer. That’s a big gap that we’re filling. A key part of that is just looking at providing a quality product and seeing if, in some cases, it could last longer than the original part.
24×7: What makes customers hesitate about buying used equipment?
Brooks: It’s no different from you and I being a consumer: I think the term used has always carried a pretty negative connotation.
24×7: How do you solve this problem?
Brooks: I think the biggest way is to build confidence. We do this two ways: We have a large customer base for references that have had experience with us, and we also provide a warranty. We’ve built a level of confidence; and that’s really the key.
24×7: What level of savings can customers realize by using replacement parts?
Brooks: Customers can experience savings in the 30% to 80% range, and that’s why it’s enticing. They can provide a quality product for their patients and be able to manage in these times we’re in. 24×7
24×7: What are some of the other things Ardus is focusing its attention on?
Brooks: Looking at the services that we’re actually providing. We visited a customer yesterday, a state university, and went through identifying what we could help them with. They asked us if we could help them be their hands—and on many of these products we could work on more advanced technical matters within the clinical institution.
We are also providing something that’s new and old at the same time. We’re actually going out providing door-to-door service—something we call the PARR (parts, accessories, rental, and repair) program, which is more like milk runs. We call on institutions and ask them: What do you need this week as far as parts go? We make sure that those parts are on their shelves, and we pick up and deliver devices. We’re really focusing back on that customer service element of it, which saves the customer a lot of time. We’re finding it’s a big area of efficiency for the customer.
24×7: Do you document what enhancements have been made to a part?
Brooks: Yes, we do. The FDA really requires that all devices be tracked. For us in general, we want to look at the way our systems are set up and to track things by serial, by part, and by lot number where it’s applicable, and to really know what state these devices are in as we take them through the process. We document all these steps. Most of these things are always geared to what the OEM provides as a guideline for performance verification.
24×7: How did you get started with the company?
Brooks: I’ve been with Troy for about 15 years now. I worked for a large OEM for numerous years, and I knew Troy through that circle. He was buying devices that would require software enhancements and tracking what he was doing. At the time, he was coordinating through me and we interfaced a fair amount. A couple years ago I stopped in for lunch, and lunch turned into an interview and I started working for them. At the OEM I was in product development and looking at providing field service. It was an excellent fit.
24×7: What do you do on a day-to-day basis?
Brooks: My position is customer focused and customer based. Basically, I look at overall parts development. I work with our team of engineers and look at how we’re going to solve problems and provide testing to ensure overall quality. In addition, I provide a support role to the service side of the business and the activities that we’re providing directly to our customers, as well as look at service programs in general.
24×7: How did you get started producing replacement parts?
Brooks: We had a fairly large fleet of our own devices because of the rentals and instrument sales. We found we were replacing, or frequently replacing, a basic handful of items. We started that development to address those needs and found that it was really working well for us. Once we were confident that product quality was there, we started providing that service to the end customer. A key component for them was product quality and part availability. In some cases parts aren’t supported by the OEMs.
24×7: Do you think that not supporting parts becomes a lost opportunity for the OEMs?
Brooks: In many cases most OEMs are looking at the most current model they’re working on and trying to convince customers to purchase that. Because of that focus, a lot of pressure is placed on them. They only have a certain amount of staffing and resources, and, unfortunately, some of these older products get lost in the fray. I think that it provides an opportunity for companies to go out and look at those things and to provide support. A lot of these are high-quality products, and if you can just get the parts that need attention you can provide a very safe product for the marketplace.
24×7: What’s level of support do you offer on your products?
Brooks: In many cases we provide a 1-year warranty in addition to service and support in our PARR program. As far as our field support teams go, they can provide additional systems, preventive maintenance inspections, testing, and other needs. We have the ability to provide this from the size of our team. There are about 80 people in our organization, and we’re all parts-service oriented. Typically, if a customer has a need for a part, we can address that in a pretty short amount of time.
24×7: Do you find it a greater challenge as a part gets older to keep it up to regulation?
Brooks: I think it really comes down to your level of documentation and tracking ability. For us, I think with having prior OEM experience we’re very thorough in what we’re doing. And the tools that we have—our software and our tracking capabilities—really lend itself to this. It’s actually pretty straightforward.
24×7: What about regulations pertaining to repairs and keeping up quality?
Brooks: Like with tracking, we follow similar guidelines as far as what work was performed, the amount of time it takes, what parts we have used, and following that OEM checkout procedure, for say, performance verification. All those things together would tell you that this device is ready for use.
24×7: Do you sell mainly to equipment dealers or to end users?
Brooks: In our marketplaces, we go directly to the end user hospital or health care organization, but in many cases, we also work with a network of dealers as well. We find out what they need for their customers, and in many cases we can have a product on the shelf and ready to go for them. They generally have a defined market and defined quantity, and as far as looking at that, the transaction is very fast.
24×7: What type of training in pre-owned equipment is given to techs just starting out with Ardus?
Brooks: We actually have a training program that consists of factory training and factory certification training, and we also have peer-to-peer programs, as far as what they’re working in as well as the supervisory side. The person who is actually managing that group or that person will identify a program for them to follow and check the balance of their quality audits to make sure they’re providing that level of service.
24×7: How do you acquire new equipment/parts?
Brooks: Actually, in several different ways. Institutions often have surplus devices, and in many cases we’re generally aware of devices being available and we’ll go out and procure them. In some cases we have customers that say: “Hey, we’d like for you to go out and purchase overall in that broader base of product, from that point,” so we actually go out and purchase several different products for that end user as well as possibly talk to some dealers to fulfill other needs for them. Primarily, our sales force is a conduit to working directly with the customer when surplus is available.
24×7: What are some suggestions on what to do with older, unwanted equipment?
Brooks: Contact us. In many cases we can tell customers very quickly what a device would be worth. And if we may not be interested in a piece of equipment, through our network of working with other organizations we might be able to find a group that would be.
24×7: Where do you see the replacement parts industry going in the next 5 years?
Brooks: I think it will be growing in general because of some of the financial needs and concerns based on this marketplace. The pressure’s no different than any other. Medical people are looking at end users and providing quality products reliably and saving money, and that’s really going to be in the parts field.
Stephen Noonoo is the associate editor of 24×7. Contact him at .