Analysis of healthcare industry
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Healthcare Industry Sri
Lanka
Healthcare Industry Sri
LankaIndustry AnalysisIndustry Analysis
Isuri KumariB.Sc. in MIS
Summary
• Fast growing industry• Healthcare can create an enormous part of a
country’s economy.• Consists of hospital activities, medical and
dental practice activities, and other human health activities.
• Companies that provide medical equipment, medical supplies and healthcare services such as hospitals and nursing homes.
Political and Legal Environment
Technological Factors
General Environment
Economic Forces
Socio – Culture Influence
Political Forces
• Rules and regulations -valid license for importing drugs.-entry and exit laws.- Foreign degree holders cannot work
without passing exam conducting by government.
-Tax policies Sri Lanka government is currently getting less percentage per annum on the cost.
Economic Factors
• Quality and demand depends on the personal income or wealth
• International financial crisis is very important when conducting business globally.
• Interest rates on loans affects the industry.
• Exchange rate is also important when importing and exporting.
• Domestic production level of medicine.• Government spend lot for maintain good
health of the country (malaria and HIV projects).
Socio-cultural Factors
• People’s spending for health and their loyalty.
• Attitudes of people.
• Country’s demographic factors
- female percentage is higher than others..
• Media glance for this industry is higher and media
can be used as a publicity tool, respecting the
culture.
• Ethics of country
Technological Factors
• Introducing new vaccines. • R & D to find new treatments - SAS, SWINE
FLU • Well tested medicines and medical
equipments to serve.• Adoptability of modern information and
communication technology.• Safety & standardized transportation techniques for medicine.• Government legislation on technology• Patent for medicines and equipments.
Porter’s Five Forces Model
Threat of New Entrants
• Initial capital requirements - to buy high technology equipments, salaries, to rent premises.
• Government rules and regulations
• Brand loyalty of customers to existing hospitals
• Needs highly qualified medical consultants & nurses. Qualified and trained professionals
desire to work with reputed institutes.
• Switching costs
• New entrants will lower the market share of the existing institutions.
Competition from Substitutes
• Quality services and well branded medicines.
• Brand loyalty. Brand Loyalty. All competitors try to give best service with low price than others.
• Kind and heartiest hospitality service for patients.
• Different brand names for the same generic (Paracetamol)
• Service expansion - e-channeling, partnership with mobile service providers and geographical growth
Bargaining Power of Suppliers
• Well reputed consultancies and medicine suppliers have bargain power. They can demand themselves - gsk, Hemas, SPC
• Monopolist miscellaneous suppliers - Lanka Oxygen Company & Ceylon Electricity
• Food and beverages are the essential for day today activities in Hospitals.
• Generally hospitals should be kept environmental friendly- Need to hire quality cleaning service
Bargaining Power of Buyers
• This industry deals with human lives. So always they are comparing the services and facilities with competitors.
• It is needed to look after them and give them satisfactory service to retain them.
• If some hospitals have quality services with low price, patients visit those hospitals.
Rivalry between Established Firms
• Price competition between main competitors creates intense rivalry due to changes of prices.
• Service introduction. Competitors always update with the latest technology and seeking for innovation.
• Advertising directly affects to the company picture.
Opportunities ThreatsOpening new branches in island wide and world wide
Labor turnover
Opening new laboratories using latest technologies
Patient turnover
Increase number of rooms in hospitals
Other hospitals moving to new technologies
Facilities for mobile and e-channeling
Inimitability of unique features
24/7 hours Availability Interest rates fluctuation
Opportunities and Threats