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March 2009
Focused on the Fine Print
By Ellison Clary
Many businesses rely upon a great deal of electronic equipment for their day-to-day operations. And in most cases, when that equipment breaks down or malfunctions, the maintenance contracts that were purchased from the Original Equipment Manufacturer (OEM) are filed away somewhere or worse, nowhere to be found, leaving the owners at the mercy of an OEM provider-now servicer. Rarely do owners consider the coverage and costs of these contracts.

      Enter, The Remi Group, which, since 1998, provides equipment maintenance management programs and helps companies nationwide gain a clearer understanding of their true maintenance expenditures, enabling them to eliminate unnecessary costs and reduce inefficiencies.

 

Real Cost Savings

      Dan Schuster, The Remi Group founder and CEO, has seen his business grow rapidly with the increase in electronic equipment and equipment maintenance contracts.

      “These days there are maintenance or service contracts on everything from a consumer purchase at an electronics store on up. However, unlike consumers who don’t typically buy the extended warranties because they don’t gauge them to be of good value, in corporate America—health care, government and so on—it’s just the opposite; they buy maintenance contracts on everything,” says Schuster.

      In addition to providing more organized, efficient and lower-cost equipment maintenance, The Remi Group can also provide companies with a distinct cost savings in these tight economic times.

      “Maintenance contracts are almost always overlooked when businesses address fiscal matters to cut costs. Most businesses tend to focus on salaries, health care, and real estate expenses in order to reduce expenditures,” Schuster says.

      “Nobody’s looking at the equipment they currently own and what they are spending annually to maintain it,” furthers Schuster. “We point out that the money being spent may not be serving their financial interests and we show them how to change that.”

      Ron Calhoun, president of The Remi Group elaborates: “Our value proposition is the last spoke in the expense wheel that’s yet to be tightened. Virtually every other expense on that wheel has been addressed but maintenance contracts. It’s because of the non-integrated nature in which the buying decision is usually made—the purchasing decisions and maintenance decisions are entirely separate. We focus on ‘the fine print’ and add value which is often overlooked or unconsidered.”

      When clients sign with The Remi Group, they still have the autonomy to select the vendor of their choice to perform the equipment maintenance and repair. The only difference now is that they don’t have to bother with calling the vendor, scheduling the repair, collecting the paperwork, or making the payment. Also, the headache that accompanies managing multiple vendors and a myriad of service contracts is virtually gone. The Remi Group program covers a client’s equipment 24/7 and consolidates all of its maintenance contracts—with one anniversary date—under one manageable contract.

      Bob Saull, senior vice president of sales, summarizes the whole process: “What we’re doing is transitioning the client from prepaid service contracts to service on a time-and-materials basis. Our goal is to ensure service quality and equipment uptime, while achieving the best return for each dollar invested in the maintenance of the client’s equipment.”

      The Remi Group is also mindful so as to not compromise any service requirements that were included in the client’s original service contract.

      “We ensure that all of the service vendors are reimbursed in a timely manner,” Schuster declares. “We have a huge network of qualified, reliable vendors that we depend upon and we want our vendors happy,” Schuster remarks.

 

How the Program Works

      The Remi Group itself does not affiliate with any OEMs, service providers, or leasing companies. “We provide an unbiased solution that serves only the needs of the client,” says Schuster.

      When service on equipment is needed the client calls The Remi Group’s Service Center and a dispatcher calls the client’s preferred service vendor and then manages the entire service event from start to finish. The dispatcher confirms that the client receives satisfactory service. All paperwork is sent directly to The Remi Group for processing and payment.

      “A decade ago, service dispatch was not so much in demand, but as operating budgets have gotten leaner and as support staff has gotten smaller, clients want the convenience of dialing just one number for service and relying on us to handle the rest,” Schuster says. “It makes their jobs a lot easier.” The Remi Group also gives their clients the option of calling the vendors directly for service if they prefer.

      The Remi Group program has been in place in one of the nation’s largest “for profit” health care systems since June of 2001.

      “At the time, the tracking of maintenance and repair expenditures was inconsistent across many of the facilities,” notes Schuster. “The system had no visibility into what they were spending on the maintenance of their equipment.”

      “Due to the fact that many of the system’s facilities were spread over an entire state, we immediately realized that our centralized program model would be pivotal to success,” Howison explains. “The key was to develop a program that worked in partnership with their existing in-house clinical/biomedical engineering department at each location.”

      “We developed a customized solution that confronted the complex needs of a multi-hospital system, while being sensitive to the unique strengths and requirements of each location within the system,” Howison continues. “Our commitment to total customer satisfaction has led to a long-term relationship that delivers growing savings year after year for the entire system.”

      The Remi Group underwrites their program with the financial backing of A-rated insurance companies such as General Fidelity Insurance Company (owned by Bank of America), Zurich North America, and Royal & Sun Alliance Canada.

      “Our clients can be assured that any maintenance obligation will be met. Our program is backed by some of the strongest and most financially secure insurance companies in the industry,” Calhoun notes.

 

Transparency

      In addition to hospital and health care providers, The Remi Group has programs in place with commercial, educational, financial and government institutions, including seven current statewide contracts.

      “It’s a portable model; we started out in the health care industry and then quickly moved into government, banks and even grocery stores,” Schuster says. “The program has worked in every market segment that we have tried it.”

      “The list of equipment covered on the program is extensive, but it’s basically anything that is electronic in nature and plugs into a wall,” Calhoun offers. “We cover medical equipment spanning from low-end clinical to high-end diagnostic imaging. We also cover laboratory and research equipment, general office equipment, IT, communication, security, and mail room equipment.”

      “Another major benefit of the program is the fact that we capture and report upon all aspects of the program including vendor participation, equipment performance, and cost metrics.” Calhoun says.

      “That transparency is very important to us because it’s client-centric, not Remi-centric or OEM-centric,” Saull observes. Transparency in reporting affords The Remi Group clients a history of all service events that he says is “information equipment manufacturers would never provide in their reports to their clients.”

      “All program information is accessible 24-7 on Remi Online, our customer internet interface. Clients have real-time access to all aspects of their equipment information,” COO Brent Howison adds. “This information gives our clients the power to make informed decisions concerning choice of service vendors and new equipment purchases.”

      Many business owners can relate when told by a vendor that their equipment is becoming obsolete, can no longer be maintained, needs an upgrade, or needs to be replaced.

      Schuster raises an interesting question, “Why would we rely on the same guy who sold the equipment to be in complete charge of maintaining that equipment and not walk away thinking there’s an inherent conflict of interest?”

     The Remi Group has been serving the State of New York with their equipment maintenance management program since April 2002. While cost savings and enhanced management oversight were both important, management reporting and having comprehensive information on equipment performance was vital to the state. To meet the state’s evolving needs, Remi created—and continually adds to—a suite of customized reports for them available around-the-clock through Remi Online.

      “Our account services and information technology team works closely with the State of New York staff to ensure that they receive all of the information necessary to help them do their jobs,” Schuster adds. “We believe in information transparency, so when our client asks for custom reports or information, we find a way to meet that need through Remi Online.”

 

Spreading Out

      Like many start-up companies, The Remi Group didn’t begin with large clients or even a lengthy client list. “We were working on small deals 10 years ago and an occasional big one. We were determined to get our message out there that we have an alternative solution to high-priced equipment service contracts,” Schuster declares.

      “We are still pushing that message and it is resonating, especially in times like these when everyone has to reduce spending and cut costs,” Howison adds. The Remi Group is diligently working to build brand awareness through their direct marketing efforts.

      With the flagging economy, there is no doubt more businesses are looking for ways to be more frugal particularly in the government and health care sectors.

      “Because tax revenues have fallen so dramatically in the government segment, they’re looking at cutting back programs that serve citizens,” Schuster observes. “One of the reasons government entities choose our program is because they are being forced to do more with less. Extending the lifecycle of electronic equipment rather than replacing it is much more advantageous. Our program extends the useful life of equipment by making sure that the equipment is properly maintained.”

      Saull points out that by scheduling preventive maintenance regularly, The Remi Group is able to keep the equipment up and running and extend its useful life.

      “With aging equipment, the cost of a maintenance contract with an OEM will typically increase between 3 and 8 percent annually,” Saull says. “If a three-year contract for that same piece of equipment is signed with The Remi Group at a savings of 20 percent compared to the OEM price, that price is fixed and is capped for the next 36 months.”

      The Remi Group currently has multiple statewide contracts in progress and has even branched out into Canada and has plans for business opportunities in the European Union.

      “Historically we’ve gone where our message has resonated the quickest. While we are Charlotte-based, we have a national value proposition that is moving toward an international audience,” notes Calhoun.

      While The Remi Group competes against many “highly motivated” OEMs employing hundreds of thousands of technicians nationwide, “The OEMs tend to drive their profits through the service side of their business, which is where we can exist and operate more efficiently and serve all of a client’s equipment needs across the board,” Schuster explains.

      Calhoun suggests, “Companies contemplating tough budgetary decisions—especially now—should take a close look at their equipment maintenance expenditures first…because they may be surprised at the cost versus value.”

Ellison Clary is a Charlotte-based freelance writer.
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