Henry Schein’s acquisition of Merritt bolsters its network along the eastern seaboard
With the animal health market showing no signs of slowing its growth, the recent acquisition of Merritt Veterinary Supplies supports one of Henry Schein’s strategic goals “to strengthen the company’s position in a fast-growing animal health market,” according to Fran Dirksmeier, President, Henry Schein Animal Health, North America.
Henry Schein, Inc., recently closed on its acquisition of Merritt Veterinary Supplies, Inc. (Merritt), an independent, family-owned supplier of animal health products. Merritt serves approximately 4,500 veterinary clinics across the eastern U.S., and has a particularly strong presence in the southeastern U.S.
“The acquisition of Merritt Veterinary Supplies, one of the nation’s largest independent regional veterinary suppliers, will meaningfully add to the scale of our U.S. animal health business while reinforcing our existing animal health presence in the eastern U.S. It also will benefit our animal health diagnostic, equipment, and surgical instruments businesses, including scil, KRUUSE, and Veterinary Instrumentation,” said Stanley M. Bergman, Chairman of the Board and Chief Executive Officer of Henry Schein. “We look forward to serving Merritt’s customers with the same high standards and commitment to helping veterinarians run more efficient, successful practices while providing the highest quality care.”
What does this mean for the distributor, as well as its customers? Vet-Advantage discussed the acquisition with Fran Dirksmeier, President, Henry Schein Animal Health (HSAH), North America.
Vet-Advantage: Congratulations on the acquisition of Merritt Veterinary Supply. Tell us about the timing. Why did it make sense now for HSAH? For Merritt?
Fran Dirksmeier: Henry Schein Animal Health and Merritt share a deep commitment to helping veterinarians provide high-quality care as part of operating efficient and successful practices.
The transaction is part of a corporate initiative and supports our strategic goals to strengthen the company’s position in a fast-growing animal health market, expand our distribution network, and grow our presence along the eastern seaboard, resulting in greater value for customers.
We acquired Merritt because we respect and admire their commitment to build a business that is focused on maintaining customer loyalty by providing veterinarians the best product selections, value, knowledge, and customer care. The transaction was signed in the summer and we closed in September, making it possible to prepare for the merger and help ensure an efficient and seamless transition for customers.
Vet-Advantage: What does this do for Henry Schein’s geographic presence in the Eastern United States? How many sales reps were added to the HSAH team?
Dirksmeier: Merritt serves approximately 4,500 veterinary clinics across the Eastern U.S., with a particularly strong presence in the southeastern U.S., so this acquisition will greatly enhance our ability to offer these customers a broader array of products, value-added services, and technology solutions.
We added 44 sales reps:
Outside Sales: 24 outside sales reps + 2 sales managers
Inside Sales: 16 inside sales reps + 2 inside sales managers
Vet-Advantage: In what ways does this help Merritt’s veterinary practice customers? What can HSAH bring to the table that can help practices thrive in a rapidly changing marketplace?
Dirksmeier: Henry Schein Animal Health offers its customers exclusive, innovative technology solutions, including practice management software and e-commerce solutions, as well as a broad range of financial services. This suite of services was not previously available to all Merritt customers and we believe they will find great value in the enhanced level of support that is now available to them.
As a result of the acquisition, Merritt customers will benefit from the broad geographical presence of HSAH’s distribution network, as well as its steadfast commitment to provide customers with the products and services they need to deliver high-quality care to their patients while operating successful practices.
Vet-Advantage: What will the sales team structure look like? Are you adding an additional region or simply realigning to bring the Merritt sales team into Schein?
Dirksmeier: Many Merritt sales reps have been embedded into the existing HSAH sales regions and team structure. In addition, two new sales regions were created, as well as two new inside sales teams (Columbia, S.C., and Birmingham, Ala.).
Vet-Advantage: What needs to happen for a successful integration? We know things just closed, but how are things progressing to date?
Dirksmeier: Every integration is different, but an in-depth, cross-functional planning effort before a transaction close is always critical in order to establish a solid foundation for the integration. Our integration team was made up of senior leaders from each and every function of our business, each of whom were actively engaged before, during, and after the close of the transaction, which allowed us to make adjustments quickly and efficiently when necessary. For example, our level of preparation was put to the test when Hurricane Irma hit the southeastern United States on the weekend that we closed the transaction and executed the integration activities. Because of our preparation and the engagement of our leadership team, we were able to make the necessary adjustments to protect our team, our customers, and our inventory.
From the beginning, we approached this integration with a set of guiding principles in alignment with our core values. We have adhered to our principles and our team has been executing very well. For example, one of our key themes was a focus on the customer and doing everything within our power to guide customers through the transition without disruption. This aligned well with our strategy to efficiently and effectively onboard Merritt’s inside and outside sales team members so that we could provide the critical continuity of the sales rep/customer relationships.
Vet-Advantage: As you roll in the Merritt team, will you keep any of their current distribution locations open?
Dirksmeier: After completing a thorough assessment of our customers, product portfolios, warehouse facilities, distribution centers, and corporate functions to fully integrate all business functions, we made the difficult but necessary decision to close the Merritt warehouses by the end of 2017. Given the increasingly competitive marketplace, we concluded that making these decisions are in the long-term interest of the customer.
Vet-Advantage: Are there any new unique products or services that HSAH will have access to through Merritt?
Dirksmeier: Merritt offered few products and services that we don’t. In fact, we have a portfolio of exclusive products, including Henry Schein-brand products that we are excited to bring to the Merritt customer base.