Nobody denies that aesthetic medical devices are a significant investment. Device manufacturers and researchers spend millions of dollars and thousands of man-hours performing clinical trials to develop safe, effective devices and treatments for the aesthetic practitioner.
Buying used may seem cost-effective for several reasons, but in the end, it may not be. Either way, the decision to purchase a device, new or used (and if used, then from whom?), must be carefully considered. Factors such as your expected return on investment (ROI), the need for disposables, your understanding of the therapy, and trust in the science behind it, and your belief in the manufacturer’s reliability is much more important than the cost to buy or lease the laser itself. In fact, the very same decision-making process applies whether you’re looking to buy new or used, although there are a few different factors to consider with each.
You are responsible for the successful treatment of your patients. You are responsible for the smooth operation of your practice. You are responsible for the profitability of your business. And the consequences for ignoring these truths can be very high for you and others as well—namely, the people you treat.
Everybody wants a safe, effective, and reliable medical device.
We all want to feel smart and save money, but in the end, are we willing to assume the risks that come with buying used that hasn’t been certified from the manufacturer? They may outweigh the rewards. After all, would you give your child a used car without first being totally sure it was safe? Is what you lose buying used worth the cost of simply buying new?
Coined by the automobile industry, the phrase “certified pre-owned” (CPO), fits perfectly when you are talking about another complex piece of machinery where you need to be sure you can trust it with the lives of people that are important to you. The laser device was owned by someone else before you bought it, and its maker cared enough to make sure it works like new for you as well.
As to your bottom line, the cost of trusting a used laser can quickly and easily exceed the savings you may get upfront by buying a cheap device. Dealing directly with the manufacturer gives you the peace of mind that you are getting a quality device. What do you think your patients would want you to do?
Whether considering a new or used laser, the aesthetic practitioner must weigh the same basic factors. These can be broken into a few categories; ethical and practical considerations abound within each.
By enlisting a reputable manufacturer in your effort to purchase a previously used laser device, you may enjoy the benefits (and comforts!) that come with buying a new device.
A reputable manufacturer lives or dies based on your satisfaction, and the entire aesthetic medical device industry suffers every time a product is misused. Dealing with the laser manufacturer means that you can answer positively to all the pertinent questions.
The Seller – do you know who you’re buying from? Yes.
Performance – How confident are you that you are getting a quality laser device? Very confident.
Hidden costs – do you know what you’re really going to be paying long term? Yes.
Warranties – are your out-of-pocket expenses truly less when buying from a 3rd party seller? What is peace of mind worth to you and your patients?
Maintenance – will you get the service you deserve before you’ve lost too much money? A respectable manufacturer will do everything in their power to make sure you have minimal downtime.
While it may seem obvious that buying new should be your first, best option, it is equally obvious that economic factors, at times, make this difficult. Going with CPO from a trustworthy manufacturer provides you with the same level of confidence in your new-to-you device that you would hope for from a new device, with savings to boot. Candela manufactures FDA cleared devices within strict FDA specs for optimal results; purchasing from 3rd party sellers who may have tampered with the inner workings of a device may, in fact, cause harm to your patients and increase your liability exposure.
A new device is the all-around best bet, but if you want to buy used, go CPO.
By Alex R. Thiersch, JD, CEO of the American Med Spa Association (AmSpa)
Laser treatments are a staple of the medical aesthetic industry. According to the American Medical Spa Association's (AmSpa's) Medical Spa State of the Industry Report, laser hair removal is offered by 59% of medical spas, and it is the second-most common procedure for a first-time patient, so it actively brings patients into practices. Additionally, the report found that 29% of medical spas offer full-field ablative laser skin resurfacing. What's more, 8% of medical spas that don't offer laser hair removal and 5% of medical spas that don't offer laser skin resurfacing are considering adding them.
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In order to perform any of these laser treatments, however, the proper equipment must be acquired. And that can be more expensive and complicated than one might imagine.
In recent years, a number of new companies have begun offering laser equipment designed for use by medical aesthetic practices, which has resulted in unprecedented competition. This equipment can be very expensive, costing as much as $250,000, so the stakes in the market are very high.
The representatives who sell this laser equipment typically are compensated, at least partially, on commission, and the commissions they can make are substantial. As is typically the result of commission-based compensation plans, the reps are very motivated to close the deal. Potential clients often forget this fact when they are shopping for a new machine, but savvy consumers always will remember that the sales reps, even at the most reputable companies, make most of their money when they actually sell a machine. Because of this, some reps can be very aggressive.
Although there are many reputable laser companies with very knowledgeable, considerate reps, some other companies employ laser sales reps who act in an unscrupulous manner because of the potential for lucrative commissions. This is the primary reason why you should work with reputable companies with established track records.
Unscrupulous reps often pressure potential customers to make a decision immediately, before they have a chance to truly evaluate their options. These reps will tell customers that they are on a tight timeframe or that they have limited-time discounts that expire soon. However, prospective clients should take a step back and evaluate their options. These are major investments and should be treated with a great deal of care. Good sales reps from trustworthy companies will understand the gravity of the decision and provide customers with the time, information and references they need to make an informed decision.
Prospective customers also should keep in mind that the only time they have leverage in this situation is before the contract is signed—when you can still walk away. This is the time in the process when they must do everything they can to negotiate the deal in their best interest. Therefore, when a representative offers a prospective customer a contract to purchase a laser, that customer must fully understand that contract, because this likely will be the only time that contract can be negotiated.
Taking the time to read and understand the contracts offered by the salesperson is the best way for laser customers to protect themselves. If provisions you don't understand are in the contract, ask the sales representative to thoroughly explain them to you. A good rep will always make sure you understand the contract. But it is always a good idea to get an independent explanation. If your lawyer is familiar with negotiating laser contracts, you should consult him or her; if not, you should consider hiring an attorney with knowledge in this area. Laser contracts can be much more complex than contracts for other types of medical aesthetic equipment—they may include convoluted provisions on warranties, maintenance, technical support or authorized use, so enlisting the aid of someone who has experience with them can be tremendously helpful.
The amount of marketing support the manufacturer is offering is an aspect of a laser contract that should be carefully considered. Some laser companies offer excellent support; others say they will but offer nothing in writing to guarantee it. The inclusion of a well-developed marketing assistance program often will increase the price of the laser, but it can add substantial value to the deal. The customer must make sure that the contract he or she signs includes language that guarantees sufficient manufacturer support. With a purchase of this size, it is crucial to the customer to have as much support as possible.
It also is important to ask the representative to provide references from people who own the laser model you are considering purchasing. These should not be clients who just bought the laser and are still in the "honeymoon" period—these should be experienced users who know the highs and lows of owning the laser long term. Or, better yet, ask a group of medical aesthetics professionals you know to ensure you get an honest answer. For example, AmSpa offers a private Facebook group to its members, which acts as a forum for these and any other professional questions that come up in the course of your medical aesthetics business. A prospective buyer should ask about how the laser performs, its service record, its return-on-investment, manufacturer support and any additional relevant information. Good reps will have a large number of references from people they have dealt with throughout the years; if they don't, that should be seen as a red flag.
Some provisions that prospective customers need to carefully consider are often found in laser contracts. It can take hours to review and analyze all elements of contracts, but there are three provisions that I often focus on when representing clients in laser purchases.
Recertification fees. The most controversial provision deals with recertification fees. It dictates that the manufacturer must inspect a used laser device to "certify" that it is in working order and operating to the manufacturer's standards before it can be resold on the open market. The fee that the manufacturer charges for this service can be quite high—$50,000 or more—and it must be paid before the machine can be supported at a new customer site, which not only cuts into the resale value, but also makes it difficult to resell on the open market. However, some manufacturers provide a warranty and clinical training as part of the recertification fee, which may actually enhance the machine's resale value.
There are valid reasons for having this fee in place—ideally, it helps ensure safety for both patient and provider—but it still is a very significant cost that should be understood before the laser is purchased. This is one reason why it's very important to make sure that the laser you're purchasing can be supported by your market. If, after a few months, you decide that the equipment is not ideal, you might be stuck with an extremely expensive piece of equipment you don't use and can't easily sell— since the secondary market for lasers can be extremely volatile and tends to favor buyers.
Prospective laser buyers should know that they can, in some instances, negotiate recertification fees, and some laser manufacturers are sometimes even willing to waive them altogether, typically when a practice is introducing laser treatments in markets where they have not yet proven to be successful. In fact, some manufacturers will even offer to repurchase the machine after a period of time if customers can show that their market is not responding to the product offerings. However, these are all things that must be negotiated into the contract before the sale is finalized. If the contract is signed and these elements aren't included, you are out of luck.
Resale restriction. A resale restriction dictates that the customer cannot resell a laser without the manufacturer's approval, or that the laser must be sold back to the manufacturer at a discounted price. As with recertification fees, there are valid reasons for these provisions; however, they can limit a practice's options when it purchases new technology. Horror stories abound of medical spas with functional laser technology that they don't use anymore because newer models were released. I've seen practices that have more than $1 million worth of technology sitting in a room gathering dust because they simply can't do anything with them due to contractual restrictions and a weak secondary market.
However, as is the case with recertification fees, a resale restriction can be negotiated. Again, it is extremely important that the customer recognizes these provisions prior to signing the contract in order to maintain leverage. Reputable laser companies stand behind their products and typically have no issues working with new clients to make sure they are satisfied. If nothing else, a good sales rep should explain this provision so that the customer understands why it is there and how it is designed to help the customer.
Service clauses and warranties. Although they are commonly found in medical spas and aesthetic practices, let's not forget that these machines actually fire lasers. This technology was science fiction in the relatively recent past. These are very sophisticated, sensitive pieces of machinery, and no matter how reputable the manufacturer, the machine will need to be serviced at some point. Good companies ensure that the customer endures little downtime and expense in these situations, but it's up to the customer to make sure that everything that needs to be covered is covered for a reasonable amount of time, and that service is guaranteed to occur in a timely manner. After all, every day that the machine is offline is a day it is not generating revenue.
Prospective customers need to learn about exactly what happens if the machine breaks, what is covered—and what is not—under the warranty, and what the included customer support entails. Moreover, they must get as much as possible in writing so that they are guaranteed to have efficient, cost-effective service.
For a medical aesthetic practice, offering laser treatments can be extremely lucrative, but buying a laser is much more complicated than simply going down to the neighborhood laser store and picking one out. If you know of a lawyer who has experience negotiating laser contracts, it is in your best interest to hire him or her to help negotiate this transaction.
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