Finding and Serving An Underserved Market An Innovative Idea

Published in UT San Diego, March 10, 2014

Patricia SalasNot all innovation means inventing something new or unique. Sometimes innovation is simply seeing a market demand for a product that already exists. You do not have to invent the wheel, you simply need to bring the wheel to a place where people need wheels and didn’t know it. The infamous underserved market.

Almost 20 years ago, Patricia Salas, then working for a large company, was selling Medicare supplement and drug insurance plans in the South Bay — a low-producing area ignored by many companies. Salas saw this as an opportunity. “I educated people that they had access to these wonderful products, and in many cases, it didn’t cost them any money. In a few months I became the top rep, and I fell in love with the clientele that I served,” she said.

Today, she is the president and co-owner (with her husband, Thomas Holm) of South Bay Health & Insurance Services, a Chula Vista-based company that has 1,700 agents in 16 locations, including eight offices throughout California. The company recently moved into a 34,000-square-foot headquarters. As we toured the company, I saw posters and materials in many languages, including Spanish, Chinese and Vietnamese — an indication that the company understands how to market to its customers, the very customers that are often overlooked by larger companies and are often unfairly targeted as not being “worth the marketing effort.”

It’s clear that she is passionate about what she does as she describes a life-altering moment. “When I first started selling these products, I went to the home of a Mexican gentleman and his wife in Chula Vista. He had worked in construction since he was 14 and never had a health problem. Then he went up on his roof to do a repair, had a dizzy spell and fell. The hospital bill was more than $300,000, and Medicare only paid part of it. He didn’t qualify for Medi-Cal, so he had to sell his house, and he moved into the garage that he had converted into an apartment. If he had met someone who did what I do for a living before the injury, he would still have been in his home.”

The idea to start her own firm dates back to 2005 when she bought a house in Eastlake. Her husband, Thomas, asked, “How are you going to pay for it?” Her answer: “I’m going to start my own insurance agency.” Shortly afterward, she became pregnant and was confined to bed because of complications. This was the “we’re in this mess together” moment. Thomas took a leave of absence from his job as a certified financial planner, and Patricia recruited a few former colleagues as sales agents. In four months, she said that they completed 12,000 applications, and South Bay Health & Insurance Services was formally launched.

Thomas never returned to his old job. Today, he is the chief financial officer/chief information officer, while Patricia focuses on sales and marketing. She said that their business and personal relationships work because they trust each other and have different skills.

Entrepreneurs often evolve from parental influence and DNA. Salas’s parents owned small businesses, so buying and selling was dinner conversation. She majored in international business at San Diego State and worked part-time at the Small Business Development Center. “I saw people with dreams, and I was paid to be the devil’s advocate who had to punch a hole in their dreams. That exposed me to a lot of different business issues.”

The biggest challenge to growing the company, she said, is “finding enough good people who care and will do the job with heart. Too many people think it’s easy money, you enroll someone and then you’re done. But the cost of drugs and services changes, so our customers need to sit down with their agent every year to review their benefits, and the agents need to be educated so that they can service the member on what’s available.”

Rule No. 342

Big or little, every company lives and dies with finding, training and retaining great talent.

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