If you follow the history of Bovie Medical Corporation and William T. Bovie you learn about the wonderful invention of electrosurgery. If you follow Aaron Medical, which today is part of Bovie Medical Corporation, there is an interesting business lesson. The name Aaron Medical came from a board meeting where we changed our name from Key Technologies at the time to be ahead of Concept, Inc. in the directory. We took my last name, Saron and changed the first letter to an "A" and presto you have the first name on any product listing we were on, but that is not the lesson.
Concept was the originator of the battery powered cautery device. They owned the market, to the tune of 95% market share. Aaron Medical had a line of battery operated cauteries that had a few advantages including price, and we could barely give them away. We did some private label projects and picked up a couple of points of market, but it was a serious struggle. They say in business that hardwork and luck go together. You need to work hard enough and long enough to be in a position to get lucky, and that is exactly what we did.
Bristol Meyers came in out of nowhere and purchased Concept. They then took the battery operated cautery products and sent them to another division that they owned named Xomed.
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Step one of what not to do: Xomed didn’t like the numbering system, so they added a couple of numbers to the front, and one to the end, and overnight their product was much harder to find.
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Step two of what not to do: Cut off all of your long time distributors.
Keep in mind, it was these same distributors that built Concept to own the market. They also knew where the product was being sold and what they were buying. So what did the distributors almost immediately do? The answer of course was call Aaron Medical and see if they could purchase cauteries. While they were at it they produced a shopping list of other products that they were interested in buying since they couldn’t get them from Concept anymore either. Actually when the product went to Xomed the name Concept disappeared. So no name recognition, no catalog number recognition and your distributor can’t get it for you. But they could recommend this little company with a better product that could get them what they wanted. The result: Our business doubled in that first year.
Life is a learning experience, just sometimes you don’t like the classes you are forced to take. In this case it was a learning experience that we enjoyed. Today we are far and away the market leader in these types of devices. I just wish I knew who to thank.
Feel free to reach out or leave a comment below. Read Rob Saron's follow-up blog: Another MBA Class Opportunity
J. Robert Saron
President, Bovie Medical Corporation
