Hospitals in Michigan look to shops for revenue
BY PATRICIA ANSTETT • FREE PRESS MEDICAL WRITER
Don't be surprised to visit a hospital and be able to walk out with a mattress or a Honey Baked Ham. Borrowing a page from airports and shopping, hospital systems are expanding, renovating and taking back their retail and food operations from outside vendors and hospital auxiliaries, or working with volunteers to introduce retail concepts. Amid lean times, they are finding that
there's money to be made from selling plush bathrobes, jewelry, take-out ethnic
foods and birthday cakes.
Henry Ford West Bloomfield, a $350-million hospital that epitomizes the new trend, doesn't open to patients until Sunday, but already is seeing brisk sales to visitors and people with outpatient appointments for hypoallergenic lipsticks, cancer books, plush bathrobes and Mrs. Meyers cleaning products, said retail manager Meghan Rossi. The hospital's Sleep Well store sells hypoallergenic and natural fiber mattresses starting at $3,199 and lavender and aloe-scented pillows at $79 to $109.

St. Joseph Mercy, near Ann Arbor, is midway through an expansion of its food and gift offerings. Last year, the hospital moved a food kiosk that sells specialty coffees, sandwiches and soups to a prime front-door location, a move and expansion that brought $100,000 in revenue from a single location, said Pam Misener, system integration leader at St. Joseph Mercy.

Brighton hospital retail consultant John Johnson is helping with the transformation. His company, Total Management Services Inc., is working on retail overhauls for several of the hospitals in the St. Joseph Mercy Health System, including St. John Hospital Detroit and Borgess Medical Center, Kalamazoo, part of the Ascension Health system of St. Louis.

"I can walk into 25 hospitals and identify millions of dollars in retail opportunity," said Johnson, whose firm is advising several Ascension Health and Trinity Health system hospitals in metro Detroit. He fumes whenever he sees a floral arrangement being delivered to a hospital, seeing it as another lost opportunity. "This is revenue that could help hospitals fighting to break even do that," he said, referring to hard times facing the hospital industry these days. He tells hospitals to expand store space and stock shelves with "price-point appropriate items" that will sell.
Too many shops are filled with items there just because someone's relative is associated with the product, or they lack appeal to a wide age-range, he said. He walks through St. Joseph's gift shop and nixes window-hanging decals, china statutes and luggage, all on sale. He wants more space for flowers, cards and small gifts.
The new services are as much for employees as they are for patients and their visitors, say Misener and Maureen Husek, Beaumont's retail manager. "A large portion of your customers are your employees," Husek said. Last Easter, Thanksgiving and Christmas, Beaumont sold Honey Baked Hams and gave a portion of the revenue to the company but kept the profits from side dishes its kitchen prepared for sale. The cafeteria also sells ethnic take-out foods and pastries that can be preordered or picked up at the last minute, Husek said. "We sell items people can take home; milk, bread, eggs, butter," Misener said. The hospital also will decorate a birthday cake with a special inscription. The idea came from the staff. "It kind of feels nice that we're actually meeting the needs of people," Misener said.

Johnson tells hospitals to expand hours and space for retail sales. He hopes to add 30 jobs at St. Joseph's by expanding food kiosk hours and offerings. He tells hospitals not to staff retail operations with volunteers if possible. Many hospitals already are having trouble keeping shops open and close most weekends or even weekday hours, because they don't have enough volunteers, as more work to earn money after they retire.
He asked: "What coffee shop do you know that only has one person working for three
hours and she has to put up a sign saying she'll be back in awhile?"

Its Heating Up Real Fast

For the record, I am not a Summer person. I do not mean that in a fashion or color sense, I am mainly referencing my lack of appreciation for the HEAT of Summer. Give me a nice cool breeze on a fall day, or for that matter a nice snow fall with the temperature around 30 degrees is pleasant. That said I do love to see the type of heating up that is taking place around the Retail Initiative that many healthcare folks are generating.

There are some that have begun the process of appointing their own "Retail Czars" to handle the potential new revenue cycle. It is equally exciting to see that new hospital floor plans are now including allocations for retail space and staff service areas as part of normal design functions. More of the coffee/cafe programs we promote are now seen as welcomed additions to lobbies and atrium's that had only utilized the sights and sounds of water effects or many unused soft seats. The gathering of the physicians, nurses, executives and volunteers mingling with the visitors and patients is a satisfying vision of community and sharing. Such venues will continue to encourage and promote an improved staff/patient experience throughout the campus.

The approach to the realization of this vision is not a sprint, but a marathon. As is the case with any HOT topic or initiative, there comes a need for thoughtfulness and good planning to maintain and direct its energy to avoid a "snuffing out" of the flame. We have all witnessed great ideas and concepts that had the 100 yard dash approach to their roll out, only to pull a hamstring three quarters of the way into the race. We cannot risk racing to place product or venues just to fill a perceived want. There is a careful Discovery phase that is needed to help identify what the true need and purpose for services are. I wake up every day looking forward to assisting those that desire such careful handling of the valued resources and passionate service for their staff and the patients that enter their doors.