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Starkey Laboratories

Starkey Laboratories in Eden Prairie, Minnesota  is this nations’ largest hearing aid manufacturer.  Starting as an all make repair lab, it’s founder Bill Austin traveled all over the Midwest forty  years ago building his repair business customer base.

He became famous for doing whatever it took to make a deal with the dispensers he was dealing with, offering everything from oblong golf balls to cash for their old salvage hearing aids.  Back then, the delivery system was a more vertical type of marketing dominated by the name brand manufacturers of the day, some who have survived to this date, other having faded away, or in most cases merged into the six giants who dominate our market today.  Dispensers, or dealers as they were known back then were seldom, “all make”, or “independent”, but most often a franchise operation of the manufacture who’s hearing aids they carried. 

The most famous of the franchises that still exist today are Beltone and Miracle Ear.  Back then, there simply was not the established and highly regulated environment in which instruments today are dispensed by audiologists and licensed dispensers, as audiology was non-existent in the field of retail dispensing and most states were just beginning to toy with the idea of licensing the sale of hearing aids.

So, the consumer of the day was tied to where they bought their hearing aid, or at least to a dealer who carried that particular brand.  There were no “all make” repair labs because these name brands weren’t about to sell parts to anyone, as repair charges represented a significant portion of their annual profits.

Not only did the consumer have to go to the Maico, Beltone, or Pooptone hearing aid dealer to get repairs and service for their Maico, Beltone, or Pooptone, repairs and repair warranties were handled much differently then, with each repair and subsequent repair warranty covering only the specific part repaired, or replaced, just like your car.  Take it to the mechanic today for brakes, next month for a radiator, and three weeks later for a problem with the Air conditioner all drew separate bills, with separate warranties and hearing aid repairs were no different.

This was a terrible deal for the consumer, but a great deal for the manufactures and dealers of the day, as the hearing aids then were much more susceptible  to damage due to the fragility of the microphones of the era.  You could drop one onto the counter from a distance of a couple of feet and ruin the microphone about half the time.  The hearing aids of the day were also very susceptible to to corrosion, most had not only a volume control, but a switch of some sort that controlled function and all had battery compartments with contacts subject to corrosion. 

You can easily see how bad a deal this was for the consumer, paying for a microphone repair today, volume control replacement next month, another microphone, etc. and you can get the picture.

Bill Austin saw what a bad deal it was for the consumer and changed that with Starkey Laboratories flat one time charge for a time specific warranty that covered anything that went wrong with the aid they had repaired.  

An instant success with hearing aid users everywhere, Starkey Labs grew rapidly and so did their program of buying salvage, trade ins that made up the parts inventory that they needed to allow them to fulfill that promise.   That program is still in place today and I get a monthly mailer from Starkey with listed prices they will pay me for every other manufacturers’ old hearing aids.

This repair warranty was so radical for it’s time that it totally upset the existing apple cart.  All the other manufacturers of the day shunned Starkey and denigrated them and Austin declaring that the plan was unsustainable, and that Starkey and it’s lab would go out of business.  I am sure there was a flash of that famous Austin smile each time he saw these same labels either go out of business, or in many cases be bought up and brought under the very Starkey umbrella they were saying was so full of holes.

But, changing the repair warranty and establishing the largest “all make” repair laboratory was only the launching pad for Austin’s next move, which once again revolutionized our industry and set the standards that are now followed by every manufacture of hearing instruments.

Here is what happened;  Back then, hearing aids came in two basic styles, the banana shaped, behind the ear type, and body worn aids about the size of a pack of cigarettes and connected to the ear by wires and a mold system.  It was these mold systems that caught Austin’s eye.  All hearing aids needed them, they connected the sound delivery system of the hearing aid with the ear.  Back then these molds were mostly made of hard, Lucite plastic and all were custom made in some sort of mold laboratory.

As told to me by the man himself, almost twenty years ago, while musing over a drink late one night with the mold lab staff, they started discussing what it would take to put all the components of a hearing aid into the mold itself.  Out of this was born the custom, in the ear, hearing aid.

But, he ran into an unexpected problem when he tried to sell them to the same dealers who loved his repair lab.  The prevailing policy of the day was as follows, when the manufacture shipped the product, the dealer owned them.  There were no return policies at any level.  You bought it, you owned it, end of story.

What he did next was the second fundamental change in the delivery system that benefited not only the consumer, but the entire industry, just like his repair warranty policy changed things, he established a totally unheard of policy, if you bought a Starkey hearing aid for your patient and they didn’t like it, you could return it and get your money back.

He was instantly ostracized by the entire industry, who was already highly irregular due to his success with his all make repair laboratory, yet within a couple of years they had all either adopted his policies and were scrambling to catch up, or had gone out of business all together.

Not only has Bill Austin’s policies changed the industry for the better for everyone, his philanthropic activities in the area of helping the world to hear have garnered him some of our nations’ highest civic awards, a living industry giant and one of my personal heroes.

They are famous for their custom products’ quality and the outstanding service that comes with every Starkey sale.