When a medical supply company with Latin American customers stopped making its hospital carts three years ago, Colorado Springs’ Harloff Company rolled in to take the account.
It was a move that opened doors to a new area of growth for the 60-year-old company, allowing it to break into an international market.
“Frankly, our growth in the international business allowed our business to be stable at a time when the demand on the domestic side has been somewhat challenged,” said Harloff President and CEO John Sweetland.
Harloff makes medication carts, acute-care carts and anesthesia carts for hospitals, clinics, surgery centers and assisted living homes. Memorial and Penrose hospitals are among its customers.
In the past three years, the company’s international sales went from 1 percent to 6 percent of its more than $5 million in annual revenue. Next year, international sales are expected to be as much as 9 percent.
U.S. medical supply and equipment manufacturing is estimated to be a $75 billion-a-year industry. Harloff has staked its claim on just one line of medical equipment: the carts.
Norman Harloff started the company in 1951 in his garage making housekeeping carts. His business took off in the hotel industry and in 1986 he sold it to the California-based Winsford Corp., which also owns Forbes Industries and specializes in hotel and restaurant service equipment.
Since its sale, Harloff has focused its attention on manufacturing medical carts. The company also makes data storage carts and automotive carts and is working on new ideas for storage and security.
Domestic sales, Sweetland said, suffered as the recession hit.
“Hospitals have been stressed when it comes to capital equipment purchases, especially a product like ours, which is necessary, but adds no revenue to a facility,” Sweetland said.
Harloff had sold its carts only occasionally overseas, and never made a concentrated effort to grow into the international market.
Today, it’s not unusual to see its fully-assembled medical carts leaving the company’s 54,000-square-foot manufacturing plant at 650 Ford St., headed for Kenya, Hong Kong or Afghanistan.
Sweetland said his staff had to learn the ins and outs of international shipping. But now the company is one of the largest outbound shippers of truckload freight in Colorado Springs.
Inside the manufacturing plant, sheets of steel and aluminum are stacked and ready to be cut, bent and shaped into carts. The company’s 50 employees make carts to order in a variety of sizes, with the most common size 30 inches tall and range in price from $800 to $1,100.
“We are fortunate that while we have a diverse product array, many of the products are based on standardized components that are rearranged in different ways and combinations to fit the requirement,” Sweetland said.
One new product taking off in both domestic and international markets is an aluminum cart that can be used in magnetic resonance imaging centers.
“Any normal steel product cannot be used anywhere close to an MRI machine without becoming a hazardous projectile,” Sweetland said. “This is a niche product that nobody else offers.”
Sweetland will be showing the MRI carts at medical equipment trade show in Dubai in January, hoping to make more direct-buyer connections. The company now works with about 300 distributors worldwide.
But there’s room to grow.