Despite rising demand for AEDs, improved operational efficiency and falling semiconductor and electronic component costs, along with mounting market competition, have driven AED prices down in the three years to 2014.
Los Angeles, CA (PRWEB) August 15, 2014
Automated external defibrillators (AEDs) have a buyer power score of 4.3 out of 5. This score reflects positive negotiation conditions for buyers resulting from suppliers' lower input costs and increasing efficiency. “Falling semiconductor and electronic component prices and increasing operational efficiency have lowered production costs within the AED market, thereby alleviating the pressure on suppliers to maintain higher prices,” according to IBISWorld business research analyst Anna Son. Meanwhile, high competition between AED wholesale suppliers has compelled them to lower their prices to attract business. Consequently, buyers are experiencing a favorable environment in which AED prices are falling and suppliers have both the means and incentive to negotiate.
In addition to market characteristics, product characteristics have also fostered strong buyer negotiating leverage. AEDs are relatively standardized products and the government highly regulates their quality. “Consequently, buyers can obtain similar results from all AEDs on the market, thereby boosting their supplier options,” Son says. Furthermore, short buying lead times mitigate switching costs, enabling customers to easily take their business to other suppliers if their requirements are not met.
Buyer leverage is projected to expand in the next three years; however, a variety of factors are expected to stifle buyer power growth. In particular, increases in the average age of the population, healthcare expenditures and federal funding for Medicare and Medicaid will send demand for AEDs upward, offsetting the impact of supplier entry into the market. Meanwhile, stricter regulations can lift up regulatory compliance costs, prompting suppliers to adjust their product prices to account for additional expenses.
A buyer's order volume has a substantial impact on their power. Buyers requiring large volume orders will generally be able to purchase directly from the manufacturer, as well as from wholesalers and retailers. As such, large volume buyers are afforded more supplier options, better enabling them to shop around for a better deal. Furthermore, large volume buyers often are better able to obtain discounts on AEDs, as suppliers have more incentive to attract these customers.
Prices for these products have a wide range per defibrillator, depending on the brand name, ancillary features offered and overall usability of the product. The top four vendors in the automated external defibrillators market are Opto Circuits India (OCI), General Electric Company, Nihon Kohden Corporation and Philips. For more information, visit IBISWorld’s Automated External Defibrillators procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of automated external defibrillators (AEDs). AEDs are portable, electronic medical devices used to treat cardiac arrest. They are designed to be simple to use, monitoring the heart’s rhythm and advising the rescuer when a shock is required. AEDs are widely used by paramedics and police, and are becoming commonly available in public places, such as office buildings, shopping malls, schools and airports. Manual external and implantable cardioverter defibrillator devices and automated external defibrillator accessories are excluded from this report.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
Buying Lead Time
Key RFP Elements
Buyer Power Factors
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