Jan. 06, 2025
Increasing health-care utilization tied to reform and an aging America supports sales growth for medical equipment wholesalers.
In many industries, some of the most successful businesses are the ones that sit in between manufacturers and consumers. These wholesalers and distributors help keep prices low by leveraging the purchasing power of many consumers while providing one-stop-shopping simplicity.
In health care, these go-between companies operate within the medical equipment wholesale market, and that market is likely to see sales grow as demand picks up thanks to an aging and increasingly insured America. So let's learn more about the industry and see whether it makes sense to invest in some of these medical equipment wholesalers.
What do medical equipment wholesalers do?
Medical equipment wholesalers rely on breadth and depth. The products these companies sell span the alphabet from anatomical charts to X-ray film. Industry leader Henry Schein, for example, markets 200,000 products, including bedpans, gloves, and syringes, to name but a few.
Medical equipment wholesalers' appeal to medical equipment manufacturers stems from large, well-trained marketing teams that have spent decades building relationships with physicians and hospital buyers. Major hospital supplier Owens & Minor, for example, employs more than 5,100 people and operates over 50 distribution centers.
By relying on medical equipment wholesalers to distribute and market their goods, equipment manufacturers can spend money developing new products rather than staffing sales teams and worrying about supply chain management.
Meanwhile, medical equipment wholesalers' ability to offer quick and educated insight into the differences between product lines makes life easier for time-strapped physicians and hospitals. As a result, the number of customers relying on the equipment wholesaler industry total in the hundreds of thousands.
What moves the medical equipment wholesaler industry?
Although medical care is often non-discretionary, demand for medical equipment does slow during recessions, as patients hold off on elective procedures and providers and hospitals ratchet down their budgets.
That said, the industry is somewhat more immune to economic cycles than non-health-care-related industries are, thanks to demand for medical equipment that is disposable, such as gloves, or necessary for common procedures, such as needles for blood transfusions.
As a result, the industry is most affected by overall health-care utilization, and that utilization is heading higher in the wake of government reform that's boosting the number of insured people through private health-care insurance and, in many states, expanded government programs such as Medicaid.
In addition to government reform-driven increases in health-care utilization, an overall aging America offers sales growth for medical equipment wholesalers, too. The number of health-care visits and procedures climbs as we age, and the over-65 population is going to be the fastest-growing segment of our population between and . As a result, the Census estimates that the number of people age 65 or older will double to more than 80 million by .
While the graying of America means that medical equipment wholesalers have a lot going for them that's encouraging to investors, the industry does have one notable drawback. Since the industry buys goods from companies eager to sell them for top dollar and sells those goods to consumers who want to buy them cheaply, the industry's margins are thin.
Why invest in medical equipment wholesalers?
The most important reason to consider medical equipment wholesalers is that global demographics support demand for the products they sell for the foreseeable future. Companies in the industry fall more in the steady-Eddy camp than anything else, but there are concerns that investors need to consider, including pricing pressure from healthcare providers hoping to shave expenses so as to boost their own bottom lines.
Industry revenue has declined at a CAGR of 0.1 % over the past five years, to reach an estimated $303.4bn in .
Medical Supplies Wholesaling in the US
Revenue (-)
Source: IBISWorldSource: IBISWorld
Market size is projected to grow over the next five years.
Cardinal Health, Inc.
33,473.8
417.9
1.2
Henry Schein Inc.
9,012.5
454.7
5.0
Healthline
83.8
4.2
5.0
To view the market share and analysis for all 3 top companies in this industry, view purchase options.
Medical Supplies Wholesaling in the US
Products & Services
Source: IBISWorldSource: IBISWorld
Industry revenue is measured across several distinct product and services lines, including Surgical, medical and hospital supplies, Surgical, medical and hospital instruments and equipment and Orthopedic and prosthetic appliances and supplies. Surgical, medical and hospital supplies is the largest segment of the Medical Supplies Wholesaling in the US.
Backlogs of elective procedures boost purchases of surgical, medical and hospital equipment post-COVID
Medical supplies wholesalers purchase medical and surgical equipment, instruments and supplies, store them at distribution centers, and deliver them and related services to medical and dental practitioners, clinics and hospitals.
Surgical, medical and hospital equipment
Surgical, medical and hospital supplies
Orthopedic and prosthetic appliances and supplies
Dental equipment, instruments and supplies
Further reading:If you are looking for more details, kindly visit APC Med.
Pharmaceuticals, cosmetics and toiletries
Cardinal Health, Inc.
Henry Schein Inc.
Healthline
Purchase this report to view all 3 major companies in this industry.
RADIO-FREQUENCY IDENTIFICATION (RFID)
ELECTRONIC DATA INTERCHANGE (EDI)
HEALTH MAINTENANCE ORGANIZATION
GROUP PURCHASING ORGANIZATION
WHOLESALE BYPASS
POINT-OF-SALE (POS)
NAICS
NAICS - Medical Supplies Wholesaling in the US
Get an indication of the industry's health through historical, current and forward-looking trends in the performance indicators that make or break businesses.
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Including values and annual change:
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The market size of the Medical Supplies Wholesaling in the US industry in United States is $303.4bn in .
There are 11,983 businesses in the Medical Supplies Wholesaling in the US industry in United States, which has grown at a CAGR of 0.8 % between and .
The market size of the Medical Supplies Wholesaling in the US industry in United States has been declining at a CAGR of 0.1 % between and .
Over the next five years, the Medical Supplies Wholesaling in the US industry in United States is expected to grow.
The biggest companies operating in the Medical Supplies Wholesaling market in United States are Cardinal Health, Inc., Henry Schein Inc. and Healthline
Surgical, medical and hospital equipment and Surgical, medical and hospital supplies are part of the Medical Supplies Wholesaling in the US industry.
The company holding the most market share in United States is Cardinal Health, Inc..
The level of competition is high and increasing in the Medical Supplies Wholesaling in the US industry in United States.
View all industries in United States
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