Sitco quietly expands presencein refurbished equipment market

July 31, 1996

Hitachi connection helps used MRI effortThe one-time Technicare executives who went on to popularize HitachiMRI scanners and Sopha gamma cameras are expanding into the usedequipment market. In the past year, Sitco, a company owned by Summit

Hitachi connection helps used MRI effort

The one-time Technicare executives who went on to popularize HitachiMRI scanners and Sopha gamma cameras are expanding into the usedequipment market.

In the past year, Sitco, a company owned by Summit World Tradein Hudson, OH, has established refurbishing capabilities in MRI,CT, radiography/fluoroscopy, cardiac catheterization labs, andnuclear medicine, while deploying an 11-person sales staff acrossthe country to sell used equipment.

"We did a 12-month market study on opportunities in remanufacturingand got excited about it," said James Yurak, vice presidentof marketing at Sitco, which is based in Mundelein, IL. "WhenSummit sees an opportunity, it moves on it rapidly."

The momentum Sitco has attained is apparent in the volume ithas already achieved in the used MRI market. Through relationshipswith the leasing/finance branch of Summit World Trade and HitachiMedical Systems America, a joint venture between Summit and Hitachi,Sitco is shipping one refurbished Hitachi MRP 5000 or MRP 7000every month. Hitachi is de-installing, reworking, and installingthe used equipment, while Summit arranges sales. Most of the scannersare trade-ins for open-style Hitachi Airis systems, said SheldonSchaffer, HMSA vice president of marketing.

Sitco serves the CT and R/F segments through a marketing relationshipwith California-based remanufacturer Medical Technology and Supply,and it gained a foothold in nuclear medicine in February whenit was contracted for turnkey management services by Medx of WoodDale, IL. Medx has been in the refurbished gamma camera businesssince 1973. Now owned by a venture capital firm, the company generatesabout $6 million annually, mainly from remanufactured GE and Siemenscircular-head systems. Sitco assigned former Technicare engineerRobert McCarthy to run the company.

The Medx connection also gives Sitco a new sales outlet fornuclear medicine workstations developed by Summit. The companyhas extensive experience in this market from previous relationshipswith Sopha Medical and Hitachi. The newest Summit product is NuQuest,a 100-MHz Pentium-based nuclear medicine workstation that is typicallycombined with rebuilt Siemens Orbiters and ADAC Genesys cameras.

While Sitco has moved forward in MRI, x-ray, and nuclear medicine,it has avoided committing resources to the used mammography andultrasound segments, Yurak said. With mammography, various incentivesfavor buying new equipment. With ultrasound, the high cost ofreplacement transducers handicaps refurbishers in competing againstnew equipment manufacturers, he said.

"We think our niche is that we are equipment experts,"Yurak said. "We are wholly focused on equipment that differentiatesus from other players, and we have the resources needed to providea very strong nationwide effort."