For Jim Parrott, the entrepreneurial spark has always been a part of his character. As a young boy growing up in a rural small town in central Ohio, Jim sold chickens to make extra pocket money. In his early teens he started a small repair shop on the family property where he would help locals with various machinery repairs. However, his first significant entrepreneurial venture was in graduate school in Dallas, Texas where he, and a small group of fellow MBA students, successfully formed a company called Diagnostic Aids which produced a self-administered pap test for women.
Jim’s future was bright and after a number of years, and a variety of managerial positions with a large industrial company, Jim moved his family to the beautiful island paradise of Maui, Hawaii where he founded a full-services personnel agency called Aloha International Employment. This was during the mid-1980s where life in the Hawaiian Islands was not as commercial as it is today and Jim’s business grew rapidly.
“As well as bringing employment opportunities to people on and off the island, I learned about the human resources side of running a business,” said Jim. “Little did I know that this experience would keep me in good stead for other business opportunities yet to come into my life.”
Ultimately selling the business and moving his family back to the mainland, Jim returned to the medical industry working with a variety of healthcare companies including Homedco, Baylor Medical Center and Hoffman-La-Roche. Then, once again, the entrepreneurial spirit called and Jim formed Practicus, a healthcare consulting company that worked with medical startups including formation and launch of a national PPO. Practicus also worked with dozens of physicians and medical centers who were expanding their practices into new revenue streams such as capitated programs, research, clinical trials and travel medicine. As with most entrepreneurs driven by the desire to take on new challenges, Jim sold Practicus and went on to work with a start-up medical spa development company.
In 2007 a group of investors recognized the potential of the company and bought it. However, as a result of the economic world meltdown that affected every industry including aesthetics, by 2008 the new owners had shut the business down in turn abandoning more than thirty newly-opened medical spas and leaving them without direction or support.
“I had considered taking a hiatus from the business world after the sale of the medical spa company,” laughed Jim, “but several of the spa owners needed my expertise and reached out to me asking for help.”
As Jim explains it, the new owners had left the medspa owners high and dry and they needed help with everything from opening the medical spas they had purchased, as well as the day-to-day operations necessary to become profitable. At first, Jim felt a duty to help the spas that had been left to fend for themselves and worked pro- bono to help them stay open throughout the recession. As the recession ground on, with margins shrinking and costs increasing, the med-spas began looking for every single opportunity to reduce costs.
Prior to the sale of the medical spa development company, Jim had negotiated preferred vendor pricing and when one of the spa owners asked Jim if he could continue to get preferred pricing on the products, services and consumables that were needed in their med-spa, this was the entrepreneurial “Eureka” moment when the MedResults Network was envisioned.
With a founding partner and using his close relationships with a few vendor partners who have since grown to become a cornerstone of MedResults Network, Jim was able to negotiate an extension of the discounts to each of the spas he worked with.
After getting positive feedback from his group of nearly thirty spas that he was now helping, with the new company Med Results Network, he began to think that there were probably other spas looking for additional savings on the aesthetic products that he could offer through his partnerships. Jim felt this suggestion by the spa owner was nothing short of a stroke of luck and, like many other entrepreneurs before him, Jim decided to take on the challenge and move forward with the new company MedResults Network.
Jim and his partner invested heavily in the new venture and for the next two years working from home, Jim was able to grow the network to nearly 250 members and added several new vendor partners and additional new benefits for the group. By 2010 Jim Parrott had created yet another solid business concept that was now providing significant cost savings to over 250 medical spas, and was increasing sales to industry vendors that was surpassing many of their individual sales team’s efforts. It was a win-win for all.
As some of the MedResults Network vendors held contracts which overlapped into the broader aesthetic industry, Jim decided it was time to expand into this arena. At the same time, Jim’s daughter Jamie had entered the last year of her MBA program at Pepperdine University. One of her assignments during the MBA Program was to perform a company business assessment with her classmates and Jim and his partner were delighted to let her use MedResults Network for the project. Although Jamie had a general understanding of the network, she really didn’t understand the full value and growth potential of what her father had helped create with MedResults Network. Neither did Jim. Not until he received the piercing analysis and scrutiny that only a team of young, eager and brilliant ”soon to be” MBA’s could deliver.
The result of this major strategic analysis of the company led Jamie and her team to realize that a well- managed group buying system was highly sustainable because vendors would want to participate due to the increased sales volume. In turn, members would want to join because of the competitive pricing for the same quality products (from the same vendors) that many of them were currently buying. The biggest flaw in the company, however, was that Jim was a one-man show, and had little experience with the new technologies necessary for future growth. Jim decided it was time to hire someone, and it was obvious that the best candidate was his own daughter.
After graduation from Pepperdine University, Jamie took on this role in 2010. In the five years since, Jamie and Jim have grown the MedResults Network to over 2500 members and 40 key vendors.
“When I came on board, I spent the first six months learning every aspect of the business (GPO/buying network) and the aesthetic industry products, services, procedures, physicians, etc.,” said Jamie. “Our reporting systems needed broader and faster capabilities. I remember Jim did most of the financial calculations by hand and member contact was limited as would be expected from one man running the company.”
She spent the next three years (and still) developing and adding new technologies to MRN that could support growth and assist in providing the best customer service to its members. She also initiated regular email campaigns and communications to the group as well as engaging in annual surveys to garner feedback. Since 2010, MRN has significantly updated its website, is able to digitally communicate regularly with members, has added a CRM system, developed intuitive reporting programs within CRM, and hired more staff, all to enable them to manage their existing member base and provide information to members, vendors and affiliates.
“Currently, we have over 2000 members and are working with 40 significant industry vendors and growing daily,” explained Jamie. “Our criteria for accepting new vendors is stringent, we’ve actually turned down over 100 companies that do not fit within our requirements.”
Jamie says she spent a good part of her first two years with MRN getting to know existing vendors and members. The better she got to know members, the more feedback they’d provide and they were always willing to put her in touch with the vendors they liked the most! As her relationships with vendors grew, she worked very hard to get to know each of their sales representatives on a personal basis, a major portion of their membership has grown due to vendor referrals. To this day, she still receives calls from reps that have moved companies and want MRN to work with their new company.
Jim and Jamie constantly tell all of their new and prospective vendors that the key foundation to the success of the MedResults Network is based on their cautious and highly selective approach to accepting a vendor. Selection is made by conducting thorough research into reputation, industry leadership, degree of national coverage and willingness to support network members with product education.
“The most important thing a vendor brings to MRN is a good reputation, they also have to be leaders in their industry category and have national coverage that will provide a benefit to our members,” commented Jim Parrott, “If through our membership we can bring some volume to them, they pay a small fee to us.”
Jim further explained that before they select a vendor they may have several conversations with their executive team and reach out to several of their physician members for feedback. In some cases (where products can be tested), MRN has paid to purchase products and have their plastic surgeons and dermatologist members test them out first. Members are obviously concerned with results, so if a product doesn’t work, MRN will not offer it. Should MRN receive negative feedback from more than two or three members about a vendor, they will politely put the vendor on notice and have, in a few cases, dropped a vendor for poor service.
“We’re always measuring feedback from our members so that we can guarantee that our vendors are performing as they have agreed to,” continued Jamie. “In addition, our commitment to vendors is that we’ll remain exclusive for the duration of the agreement—knowing that we’ll only be offering one brand for each product or service makes our selection process even more important for both parties.”
So what’s next for MedResults Network? As Ms. Parrott proudly notes, one of the main secrets of her’s and Jim’s success is that they have been able to create key personal relationships with both vendors and MedResults members. This has allowed them to be highly responsive to the needs of aesthetic medical practices and med spas, as well as member vendors.
”It may seem counter intuitive in this age of corporate consolidation, but we recognize the importance of individual and small group aesthetic medical practices and med spas as the true core strength of this industry. We know that MedResults Network actually makes a real, tangible and significant impact in the profit margin which has in turn built a very loyal member customer and member vendor base” Ms. Parrott concluded. To learn more visit www.medresultsnetwork.com.