Health E-Commerce CEO On FSA And HSA Opportunities

And I think the last challenge really is kind of “The Surge,” as we call it. As you know, these accounts have deadlines. I don’t know if you’ve dealt with a last minute deadline yourself but a large amount of these products, the FSA funds expire at the end of the year, or different periods, depending on your plan year. And so we actually have to kind of ramp up from going to like a typical day to a very, very large day. Sometimes we call ourselves as big as Amazon for a seasonal push.

And so the challenge is really kind of fill in the processes, having that same customer experience that our customers have come to enjoy and having that be the same when there’s a giant amount of traffic coming in that it is every other day. And so we’ve done a lot. I mean, one time a couple years ago, we underestimated inventory, we had to get a ton of inventory into our office to ship because the warehouse wouldn’t be able to take it. And so had to all chip in and start packing boxes and make it happen. We did. We’ve overcome a lot of the distribution challenges. We actually have our first exclusive warehouse that we launched November 1st in Kansas City to really tackle some of those surge challenges.

You’re in e-commerce. So in some respect you’re dealing with that 50,000-pound gorilla in Amazon. Obviously Amazon doesn’t take FSA but they do offer some of the products that you’re offering. So you are competing with them in that sense. So how do you compete with this 50,000-pound gorilla?

With any retailer, e-commerce or otherwise, you do hear a lot of people coming out and talking about it. I think what we’ve built in the last eight years is really a consumer experience and a customer that truly values our experience and the simplicity of being able to, like you said, use your card, have everything come out tax free, not have to deal with the headaches of paper reimbursement that you do if you walk into the store or even shop at other places online.

Our customer experience extends beyond selling products. We have 24/7 chat and support, which we use wisely because a lot of customers are still coming to us for complex compliance-related questions. We have a fully trained team of customer service professionals that are 24/7 that can answer a lot of those complex questions. We do provide value in the sense that the consumer is using their tax-free dollars on their debit card, so they’re really already kind of saving 40% on the dollar. Up to 40% on the dollar. And spending their funds.

And when they use the card, on our site, we have all the substantiation, you never need to submit the receipt, if you exhaust your funds, we’ll give you another form of payment that you can actually pay with a different form of credit card, or you can reduce products from your cart so you’re kind of maximizing that FSA/HSA dollar. And we’re doing that up till 12/31. So we are open 12/31, and we’re in New York City, we’re six blocks away from where the ball drops, and every year we’re in the office making sure each customer is getting their order in.

Some people wait till the ball drops. Until the last minute. And no one else does that. I mean, no one has all that substantiation like we do. No one else is knowledgeable to answer those questions and so if you go somewhere else, you’re kind of in a process. With us, you can use your FSA card on any product and that’s it. So I guess it tends to customer service and really kind of the focus that we have on the niche that none of the large players have including Amazon.

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