Companies in this industry distribute professional medical equipment, instruments, and supplies to physicians, hospitals, and extended care facilities. Major companies include Henry Schein, McKesson Medical-Surgical, Owens & Minor, and Patterson Companies (all based in the US), along with OneMed (Sweden), Yamashita Medical Instruments (Japan), and EBOS Group (Australia).
Worldwide, major markets for medical equipment and supplies include the US, Japan, Germany, France, Italy, the UK, and China. National distributors generally participate in international markets either through their foreign subsidiaries or through joint ventures with local companies. The medical equipment wholesale industry has been consolidating; many companies are gaining footholds in overseas markets by acquiring companies in targeted international markets.
The US medical equipment and supplies distribution industry includes about 9,500 establishments (single-location companies and units of multi-location companies) with combined annual revenue of about $165 billion.
Demand depends on the number of people receiving medical treatment and advances in medical technology. The profitability of individual companies depends on merchandising and efficient delivery systems. Large companies have economies of scale in purchasing, as well as highly developed infrastructure that allow for efficient distribution. Small companies can compete effectively by specializing in a product line or by serving a local market. The US industry is concentrated: the top 50 companies account for about 75% of revenue.
Distributors compete directly with manufacturers to sell products to end users. Highly complex and expensive equipment, such as MRI machines, are sold by manufacturers'...