McKesson Medical-Surgical Competition
Now Viewing McKesson Medical-Surgical's competition in: Medical Equipment Distributors
Call Preparation Questions
Customers, Marketing, Pricing, Competition
Who are the company’s major customers? - Customers include hospitals, physician practices, outpatient surgery centers, clinics, dental offices, and extended care facilities.
How many customers does the company serve? - Some distributors target many customers with a limited product line. Others target a few customers with a broad product line.
What type of marketing does the company find most effective? - Companies use product demonstrations and presentations, product literature, trade journal advertising, and trade shows.
Who are the company's major competitors? - The company competes with other wholesaler/distributors, and with manufacturer direct sales teams that don't use the wholesale/distribution channel.
How are product prices set? - A company is typically compensated on a cost-plus percentage basis added to the product cost agreed to by the distributor and the manufacturer.
How is the company using technology to enhance customer service? - Companies now offer full-line inventory, purchase order, and supply chain management systems to enhance customer service. Services provided may include actual ordering for and management of customer inventories.
Competitive Landscape
Demand depends on the number of people in the US receiving medical treatment. The profitability of individual companies depends on merchandising and efficient delivery systems. Large companies have economies of scale in purchasing, and highly developed infrastructure that allow for efficient distribution. Small companies can compete effectively by specializing in a product line or servicing a local customer base. The industry is capital-intensive: annual revenue per employee is about $500,000.
Business Challenges
CRITICAL ISSUES
Cost-Containment Efforts Cap Equipment Prices - Total healthcare costs continue to grow rapidly, and distributors are pressured by both manufacturers and insurers to contain costs. Although costs for medical equipment haven't grown very fast, they're subject to overall efforts to contain healthcare costs. In recent years, national spending for medical equipment increased just 4 percent per year, but average prices for medical equipment were almost flat.
Competition from GPOs - Many of the nation’s hospitals and physician offices belong to group purchasing organizations (GPO), which can negotiate bulk sales at reduced prices directly from manufacturers. Distributors are still involved in actual delivery to customers for a fee, but don't have the opportunity to resell at a higher price.
Industries Where McKesson Medical-Surgical Competes
- Health Care
- Health Care Products
- Medical Products Distribution
- Medical Equipment & Supplies
- Health Care Products
