— Distributors are expected to deploy a multi-sector, multi-brand strategy to broaden their business, says Frost & Sullivan
LONDON, Sept. 30, 2014 /PRNewswire/ — Established and new medical technology service providers are increasingly looking at distributors to help penetrate the growing Eastern European medical devices market. Distribution models eliminate the need for a sales team and regional/local offices, reducing the costs incurred by medical technology service providers. This is a crucial advantage as medical technology service providers are operating within a budget-constrained healthcare environment.
New analysis from Frost & Sullivan, Medical Technologies Distributor Profiles in Eastern Europe, finds that the total Eastern European medical device industry earned revenues of $5.40 billion in 2013. Market revenues will continue to expand at a compound annual growth rate of 3.1% during the 2014-2018 period. The study covers simple distributors, importers and wholesalers, and fourth-party logistics companies.
For complimentary access to more information on this research, please visit: http://corpcom.frost.com/forms/EU_PR_AZanchi_MA5C-54_23Sept14.
"By and large, distributors handle products across multiple medical device sectors and are able to effectively address the needs of large hospitals. Their relationships with key decision-makers, doctors and nurses of many hospitals can also help distributors secure supply contracts with hospitals more easily," said Frost & Sullivan Healthcare Senior Research Analyst Parthasarathy Raghava. "This makes distributors integral to medical technology service providers’ strategies with hospitals across Eastern Europe."
New opportunities will emerge for distributors in Eastern Europe as investment grows in private healthcare. Distributors can suggest specific strategies and project rationales that will help medical manufacturers strengthen their footprint in the private sector.
However, the unwillingness of several small, family-run distributors in the industry to consolidate and expand is creating a fragmented distribution market. Some distribution companies are also limited to small markets, as they do not have enough contacts among the main decision-makers in hospitals. As such, medical device distributors across Eastern Europe must focus on building business relationships and ensure they have sufficient resources to sell products. This will be crucial as global innovation and competition in the medical devices industry maintains the need for importing new technology in Eastern European countries.
"In due course, most distributors will adopt a multi-sector, multi-brand distribution strategy to expand their customer base and boost revenues," noted Raghava. "This strategy will align well with the continuing trend of bulk purchasing by hospitals, which reduces operational complications and contains costs."
Medical Technologies Distributor Profiles in Eastern Europe is part of the Advanced Medical Technologies Growth Partnership Service program. Frost & Sullivan’s related studies include: Automated Endoscope Reprocessor Market Trends in Western Europe, Optimisation and Efficiency Drive in Hospitals in Western Europe, Western and Eastern European Wound Care and Wound Closure Market, and Russian Arthroscopy Devices Market. All studies included in subscriptions provide detailed market opportunities and industry trends evaluated following extensive interviews with market participants.
About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, works in collaboration with clients to leverage visionary innovation that addresses the global challenges and related growth opportunities that will make or break today’s market participants. For more than 50 years, we have been developing growth strategies for the global 1000, emerging businesses, the public sector and the investment community. Is your organization prepared for the next profound wave of industry convergence, disruptive technologies, increasing competitive intensity, Mega Trends, breakthrough best practices, changing customer dynamics and emerging economies?