Niche Medical is a medical wholesaler specialising in supply and support of respiratory and neonatal intensive care equipment as well as parenteral nutrition. Niche’s wide range of customers includes a number of public and private hospitals, respiratory scientists and physicians, occupational health and safety businesses that conduct workplace assessments, asthma organisations, pharmaceutical companies, universities and other medical wholesalers in Australia.
Since its establishment in 1999, Niche Medical developed a functional business model, which even though not optimal, allowed the business to grow revenue in the competitive market. The problem lay in the lack of high enough profit to make it sustainable in the long term. The seasonal fluctuations in sales due to the budgeting and buying cycles in state government owned organisations made for very difficult cashflow management. Another issue was related to payment and finance terms between Niche and their suppliers and customers. Niche’s directors recognised the need to make changes to their business model, however were unsure of what the new strategy should entail. They also wanted to increase the turnover but were not clear on what their focus should be. That is when they decided to engage Brentnalls WA.
How did Brentnalls WA help?
By Kevin Hick, MD of Niche Medical
“Brentnalls WA started our cooperation by stress testing our business model and challenging the status quo and our thinking patterns. They brought a number of industry examples to the table and prompted us to objectively evaluate whether there is a better way to access our target market, whether our product offering is indeed the right one and whether our sales team had what it takes to succeed and to make Niche Medical more profitable. They helped us identify and subsequently focus on what is important, our key business drivers, and in particular our breakeven point. With their help, we further refined our business model, concentrating on a spread of products that we have exclusive distribution rights for in Australia. The focus on low to medium cost capital items with dedicated consumables, now guarantees us a steady revenue flow.
In 9 years of working with Brentnalls WA, our revenue increased by 53%, while the net profit went up by 326%! These incredible results are a direct consequence of strategic medium-term planning and on point tax advice. We are growing year on year and with careful planning of our expenses, we record profits throughout the year, with no loss at any time regardless of the season. We are also working on an exit strategy and succession planning, in which areas Brentnalls’ expertise are second to none. At Niche Medical, we view Brentnalls WA as an essential business advisor, who also happens to do some tax and accounting work. The Brentnalls team are not what you expect typical accountants to be. They are our trusted advisory board.”
“Running a business can be lonely and isolating. Through Brentnalls WA’s quarterly BGN meetings, we realized that our problems are not unique. These meetings give us an invaluable opportunity to discuss our non-competing business situations, share experiences and learn from other businesses similar to us, as well as from Mindshop-based themed presentations on current business trends. They connect us to other like-minded entrepreneurs and make brainstorming new ideas incredibly efficient and productive.”