The unmentionable Australian company

[wading thru the muck!]

I can't see how Resmed's business practices are the issue of individuals here at cpaptalk unless the individuals are being used in a market game.
I can understand if Johnny Goodman has issues with Resmed's sales practices if he is being squeezed by the bricks & motar DMEs (I think this is a well understood issue here).

If their actions significantly increases my cost for their equipment while others hold the line then I have a beef with them.

I really doubt that Respironics business plan & profitability goals are in *any* way different from Resmed's or Puritan Bennett's. The comments about not having any concerns for patients but all concern for investors is at best a subjective opinion not backed up by other than an emotive appeal to an image of 'greedy business' and I am again in no doubt that that accusation has as much currency with Respironics as it does Puritan Bennett.

I didn't see any other of the manufacturers succeed in forcing an unnatural retail price on the internet providers. To top it off ResMed concocted this lie that those of us that use online DMEs are getting substandard support in a effort to support their policy. This move has little to do with greed and all to do with poor management.

Are you telling us that Resmed should not be running a business but a charity ?, I know that is not what you are stating but the statement you made sort of implies this.

ResMed is free to set there pricing structure as the see fit, but that does not preclude us criticizing their practises if they are working against our best interests.

I am sure I read here or elsewhere that the price increases were once again pressure being exerted on Resmed by its large distributors & that little of these increases actually get back to Resmed but go to their middlemen so how can you claim it is Resmed lining their own pockets ?.

As I see it, this is true... so how can one defend their actions as benefiting the shareholders?


dsm wrote: The only facts I see here are...

1) Resmed runs a business and like any business has legal responsibilities to their shareholders and the stock exchange.
See above

2) Resmed have been pressured by their large distributors to change some of their distribution methods and policies. This has affected the businesses of in particular, of Internet retailers and they have a right to be upset. But the culprit is their competitors who do more business with Resmed and are exploiting this.
The fact that ResMed gave in to this pressure and concocted a lie to support their actions shows a lack of character. I agree that the Large DMEs involved are also to blame. Are you saying we aren't picking on the evil DMEs enough here LOL!

3) That most individuals get their machines through insurance policies where the insurers work with DMEs to deliver. I can fully agree with individual being annoyed at what seem like high prices for machines & masks through these insurance claims but that issue applies to any equipment manufacturer. It is not just a Resmed issue.
The relevant point here is that companies like cpap.com have made huge strides to "fix" the problem of high priced equipment offered through the traditional supply chain. ResMed is working to "un-fix" the problem.

4) That people are being whipped up in an ongoing atmosphere of Resmed bashing as it serves a business purpose and not because lots of individuals are being impacted or harmed. Anyone of us who buys our own gear can vote with our dollars and if prices are a personal issue, we inevitably will deploy our dollars to where we want. That is called market forces.
Every retail internet buyer of ResMed equipment is harmed. I agree that folks can choose to purchase "others" equipment, but that does not absolve ResMed from critisizm.

5) The health system in the US may have some flaws in how health insurance works with the medical profession and the distributors of healthcare equipment.

It does amuse me that while the US is seen as the bastion of capitalism, & this is a good thing, that has prevailed against the flawed philosophy of communism & planned production, but when it suits some folk, they attack the very notion of a company conforming to the norms of capitalist principles that made the US great.
You are only half right. For capitalism to provide the maximum benefit to all concerned it needs the protection of the free market. Any thing that impedes a free and open market place will offset the balance in favor of the seller. This is no different than the existence of a black market offsetting the balance in favor of the buyer. Would you be in favor of that?

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CPAPopedia Keywords Contained In This Post (Click For Definition): respironics, resmed, cpap.com, Puritan Bennett

[rested gal]

Well said, Wader!

[oldgearhead]

I guess what disturbs me the most about ResMed's new pricing and software policy is they used the "compliance" excuse. Of course they have no, or at best very little, data to support the theory that "on-line hose-heads" are less compliant than off-line hose-heads. Could the oppisite be true?


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CPAPopedia Keywords Contained In This Post (Click For Definition): resmed, DME

[ozij]

As Rested Gal said so well: Well said, Wader!

O.

[Wulfman]

FYI

http://www.hmenews.com/index.php?p=arti ... 0611ODbCXU

CPAP pricing fluctuates
11.27.2006

CHARLOTTE, N.C. - The price of ResMed's CPAP devices jumped an average of 49% last month due to the company's decision to implement minimum Internet retail prices, according to research released last week by Wachovia. ResMed implemented minimum pricing to reduce the difference between what brick-and-mortar and Internet providers charge for the devices.

"According to our sources, ResMed's Internet sales have declined as a result of these price increases, though this channel likely accounts for a very small portion of the company's overall sales," the research stated. "We view October's price increases as a one-time event and not representative of changes at the wholesale level."

For the entire market, prices for CPAP devices were down by 0.2% last month after being down 0.6% in September. Among the different product categories, bi-level CPAP devices have seen the largest year-to-date price decline (8.1% or 9.7% annualized), while masks have seen the smallest year-to-date decline (4.8% or 5.7% annualized).

Standard and auto CPAP devices were down 8% and 6.8%, respectively, in October.

Among the different manufacturers, Fisher & Paykel's CPAP devices saw the largest price decline last month--1.2% due to a 9.8% sequential decline in the price of its HC604 flow generator. Respironics' and Puritan Bennett's prices were stable, with declines of 0.1% and 0%, respectively.

[dsm]

Wader,

"I didn't see any other of the manufacturers succeed in forcing an unnatural retail price on the internet providers. To top it off ResMed concocted this lie that those of us that use online DMEs are get substandard support in a effort to support their policy. This move has little to do with greed and all to do with poor management. "

I will respond to this part of your post as it says so much that is relevant to this whole debate.

Firstly, to publicly state (in an internationally accessible forum) that 'Resmed concocted a lie' is very heavy stuff to accuse them of greed is heavy stuff.

To do so without offering any meaningful evidence is worse (just who is concocting what ? - who is greedily swallowing what ?).

The most you can realistically state is that Resmed have 'claimed' that on-line sellers can't provide as good support to cpap purchasers. The best evidence you can put forward is anecdotal and not hard facts. I will agree there is a case that says that cpaptalk (one online supplier) appear to have a very good and effective after sales support organization that is delivering a very effective service to those who take the trouble & have the computer awareness to avail themselves of it. . But it is very new and really just one case. Perhaps more will emerge in time & the whole support model *will* shift and provide substance to this type of support becoming a norm.

There is also anecdotal evidence that some DMEs are not very knowledgeable on the equipment they distribute and this adds weight to the case that on-line support can be better than some DMEs.

But these two bits of mitigating evidence do not justify you publicly accusing Resmed of concocting lies, or being greedy, or not giving a hoot about cpap patients. Next you will be telling us Resmed throws babies out of incubators in hospitals because they want them back !

Your accusations and the tone of them are over the top to put it mildly

*************************

As for Resmed meeting their shareholder obligations, one doesn't have to apply too much logic to know that pissing off their biggest income providers would without doubt put their level of business at risk.

*************************

Unfortunately whilst people here are encouraged to keep up the barrage of emotive statements attacking Resmed and to maintain the distortions (even untruths) about Resmed, we are seeing nothing more than yet one more attempt by another Resmed reseller to beat up Resmed yet again because it suits *their* business wants. So who is it who is being greedy/aggressive/demanding etc: this argument goes both ways.

This Resmed bashing really does bring the worst out in us. But it is clear it will continue and will sadly do so to the detriment of cpaptalk not to its benefit.

DSM

[wading thru the muck!]

Firstly, to publicly state (in an internationally accessible forum) that 'Resmed concocted a lie' is very heavy stuff ... To do so without offering any meaningful evidence is worse (just who is concocting what ? - who is greedily swallowing what ?).

Meaningful evidence of concocted lies number one and number two... from the horses mouth:

(1) A few snippets from Resmed's Q4 conference call (posted in an earlier topic) on the subject of internet providers.

I listened to the audio. So Resmed views internet sales as "bad medicine" and "bad treatment" and contends that internet retailers "don't give a damn if the patient comes back." However, Resmed is willing to overlook this "bad medicine" and "bad treatment" as long as internet retailers pay 40% more for Resmed equipment. Interestingly, in the same breath, Resmed claims this increase is "not about making more money, but because it is professional and benefits the entire sleep industry."

(2) Quote from Resmed exec in the July 2006 HME News:

"At issue: Online retailers who sell CPAPs at prices so discounted that they can't afford to offer follow-up service, maintenance or education. The result: Very low compliance. We view this as a quality issue," added Stefan Elterich, vice president of
sales, North America.


Bad medicine, Bad treatment??? Prices so discounted that they can't afford to offer follow-up service, maintenance or education???

Both completely concocted!

[dsm]

[quote="wading thru the muck!"]
<snip>

Bad medicine, Bad treatment??? Prices so discounted that they can't afford to offer follow-up service, maintenance or education???

Both completely concocted!

[JohnD]

This debate about Resmed's internet sales reminds me of the current situation in the Acoustic Piano Industry...in a nutshell, it's failing. Many Piano retailers are going and have gone out of business, bankrupt etc. partly due to the influx of lower priced Asian pianos. These lower priced imports are much less expensive than a somewhat comparable US or European version. The downturn in the economy has also been a factor.

The business model of the Piano industry that has been around for at least 100 years, is now being threatened by the Internet and it's ability to sell directly to the public, bypassing the middle man who used to be able to jack the price up of the pianos. These "middlemen" are now seeing a decline in the sales of their pianos due to the public buying direct, through the Internet, a cheaper Asian import. They have tried their darndest to buck this trend, but to no avail. The Internet and direct sales are here to stay, and if companies like Resmed do not want to go along, and raise their prices and such, then they will lose sales. Also, piano retailers have been forced to carry these lower priced Asian imports, and even then, they have gone out of business.

It's simple economics....why pay 46% more for a product, when you can get the same thing for 46% less? In this case, the other companies offering cpap, apap, and bipap machines, their quality is just as good as Resmed's. In the piano market, some of the Asian imports are not as good a quality, yet they are still able to sell these lesser quality pianos to the public. Most everyone wants a deal, and would like to pay less in the end. So, I don't understand Resmed's policy.

I am not saying that Resmed is going to go bankrupt. My point is that raising prices for Internet customers is not going to benefit Resmed in the end. This thread is an example.

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CPAPopedia Keywords Contained In This Post (Click For Definition): resmed, bipap, CPAP, APAP

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CPAPopedia Keywords Contained In This Post (Click For Definition): resmed, bipap, CPAP, APAP

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CPAPopedia Keywords Contained In This Post (Click For Definition): resmed, bipap, CPAP, APAP

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CPAPopedia Keywords Contained In This Post (Click For Definition): resmed, bipap, CPAP, APAP

[Mike2000]

It's also important to remember that ResMed is not charging the internet sales guys 40% more, the online retailers pocket the extra money, not ResMed......

[neversleeps]

Unfortunately whilst people here are encouraged to keep up the barrage of emotive statements attacking Resmed and to maintain the distortions (even untruths) about Resmed, we are seeing nothing more than yet one more attempt by another Resmed reseller to beat up Resmed yet again because it suits *their* business wants. So who is it who is being greedy/aggressive/demanding etc: this argument goes both ways.

dsm, do I understand you correctly? Are you saying cpap.com is attempting to beat up Resmed? Are you saying cpap.com is being greedy/aggressive/demanding?

[wading thru the muck!]

In Your Humble Opinion LOL!

Yes! Humbly offered in the spirit of which it is received.

Sometimes I think you Aussies must have all been given ResMed Logo baby rattles when you are born. LOL!

[dsm]

[quote="JohnD"]This debate about Resmed's internet sales reminds me of the current situation in the Acoustic Piano Industry...in a nutshell, it's failing. Many Piano retailers are going and have gone out of business, bankrupt etc. partly due to the influx of lower priced Asian pianos. These lower priced imports are much less expensive than a somewhat comparable US or European version. The downturn in the economy has also been a factor.

The business model of the Piano industry that has been around for at least 100 years, is now being threatened by the Internet, and it's ability to sell directly to the public, bypassing the middle man, who used to be able to jack the price up of the pianos. These "middlemen" are now seeing a decline in the sales of their pianos due to the public buying direct, through the Internet, a cheaper Asian import. They have tried their darndest to buck this trend, but to no avail. The Internet and direct sales are here to stay, and if companies like Resmed do not want to go along, and raise their prices and such, then they will lose sales. Also, piano retailers have been forced to carry these lower priced Asian imports, and even then, they have gone out of business.

It's simple economics....why pay 46% more for a product, when you can get the same thing for 46% less? In this case, the other companies offering cpap, apap, and bipap machines, their quality is just as good as Resmed's. In the piano market, some of the Asian imports are not as good a quality, yet they are still able to sell these lesser quality pianos to the public. Most everyone wants a deal, and would like to pay less in the end. So, I don't understand Resmed's policy.

I am not saying that Resmed is going to go bankrupt. My point is that raising prices for Internet customers is not going to benefit Resmed in the end. This thread is an example.

[dsm]

Unfortunately whilst people here are encouraged to keep up the barrage of emotive statements attacking Resmed and to maintain the distortions (even untruths) about Resmed, we are seeing nothing more than yet one more attempt by another Resmed reseller to beat up Resmed yet again because it suits *their* business wants. So who is it who is being greedy/aggressive/demanding etc: this argument goes both ways.

dsm, do I understand you correctly? Are you saying cpap.com is attempting to beat up Resmed? Are you saying cpap.com is being greedy/aggressive/demanding?

NS,

I was being as cheeky as Wader

D

[Mike2000]

I am not saying that Resmed is going to go bankrupt. My point is that raising prices for Internet customers is not going to benefit Resmed in the end. This thread is an example.

I think you'll find that internet selling makes up a very small percent of the total market (5% maybe) and we are also only talking the US which again is not the whole market. If you look at other online sellers from around the world, their prices have not gone up.