An aging population and product innovation have kept industry demand steady
New York, NY (PRWEB) June 19, 2014
In the five years to 2014, the Medical Supplies Wholesaling industry has exhibited robust revenue growth as healthcare expenditure expanded per year on average, driving demand for medical supplies. Furthermore, the number of adults aged 65 and older has risen at an annualized rate. “As the Canadian population grows older,” according to IBISWorld Industry Analyst Jocelyn Phillips, “disease and health complications become more common.” In particular, devices that affect the older population, including neurological and cardiovascular products, are expected to experience strong sales over the next five years. Therefore, “Companies within this industry are increasingly wholesaling these types of medical supplies,” says Phillips.
Each year, newly introduced products give providers reasons to purchase supplies from wholesalers. The substitution of new and more expensive products, rising prices for existing products and more per-patient use of drugs and supplies have contributed to industry growth. During the five years to 2014, IBISWorld expects industry revenue to grow at an annualized rate, including an increase in 2014. However, rising commodity prices and prevalence of group-purchasing organizations (GPOs), which have the power to negotiate collectively lower prices, have suppressed industry profit growth during the past five years.
The Medical Supplies Wholesaling industry has a low level of market share concentration. During the five years to 2019, IBISWorld expects revenue to grow at an average annual rate. New product development among medical device manufacturers will continue to support industry growth by offering solutions to previously unresolved health issues. Consolidation among medical device manufacturers will cause wholesalers to merge in order to maintain negotiating power and meet the needs of larger customers. While larger company structures will help reduce costs, industry profitability is expected to suffer due to continued pricing pressure from GPOs, leading to falling product prices and thinning profit margins. In an attempt to counteract downward pressure on profit, industry operators are expected to implement initiatives focused on improving their efficiency, including investing in warehouse-management and demand-forecasting systems.
For more information, visit IBISWorld’s Medical Supplies Wholesaling in Canada industry report page.
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IBISWorld industry Report Key Topics
The Medical Supplies Wholesaling industry wholesales medical and surgical equipment from distribution centres. Customers include medical and dental practitioners, clinics and hospitals.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
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