Why are prosthetics so expensive? 51 prosthetics do in-depth analysis for you

Prosthetics are so expensive!

Many netizens have written to us and said: "Prostheses are too expensive and cannot be afforded"; I will also see many similar questions on the Internet. Today, 51 Prosthetics Network will give you an in-depth analysis of why prosthetics are so expensive?

Some netizens also gave some answers, such as the anonymous answer from Zhihu:

Let’s first talk about the domestic prosthetic industry

First, industry issues. The domestic prosthetic limb industry implements a general agent model. It can be said that competition in the industry is not fierce. The two major agents, Ottobock and Reha, divide most of the domestic market. It's a bit like an oligopoly.

Amputees either choose Otto Bock or the products such as Oso, McGrady, and Steffen represented by Reha. The share of choosing other products is relatively small. Therefore, the two companies have no incentive to reduce prices.
The two companies are suspected of colluding on prices. Ruiha is a latecomer, his idea is very simple, product performance, benchmark Otto Bock, product price, similar or slightly lower. In other words, for a product of the same grade, the price of two brands is the same grade in the market. This is obvious price collusion.

Second, average cost and average profit margin.

I often say that prosthetic limbs are not for sale. If a prosthetic limb factory can make 1,000 prosthetic limbs a month, then there is no problem if the prosthetic limb factory immediately cuts the price by 25%. However, how much can most prosthetic limb factories do in one year? Fixed costs such as rent, labor, water and electricity, equipment depreciation, etc. must be spread equally among each prosthetic limb. If the output is low, the spread cost will naturally be high.
average profit margin. For a well-run prosthetic factory, the profit rate is between 20 and 30 percent in annual settlement. Compared with the medical industry and the service industry (prosthetic limb factories are actually service organizations that provide prosthetic limb assembly services), this profit is not high.

Third, some other actual situations.

I have been working on the front line of the prosthetic industry for a long time and have seen many "strange phenomena". Many patients choose prostheses not based on their own needs, but based on the money in their pockets. On the one hand, this must be due to the misleading of unscrupulous manufacturers, who always think that the more expensive the better; on the other hand, it may be related to subsequent issues such as compensation.
What kind of prosthesis does the patient need? This is a big problem. Prostheses range from a few thousand to hundreds of thousands, and the choice depends largely on the amputee himself. I think domestic prosthetic products are expensive, but why not choose cheaper products that are more suitable for you?
This is a bit like the issue of doctor-patient relationship. Chinese people never think that services cost money. As mentioned earlier, the prosthetic factory provides prosthetic limb assembly services and subsequent maintenance, debugging and warranty services. The value of these things is rarely considered by amputees when they choose to assemble prosthetic limbs. Amputees think more about how much money I spent and what kind of thing I bought. If I have to use metaphors, the difference between Xiaomi mobile phones and VERTU mobile phones. VERTU buys services, while Xiaomi buys hardware.

Let’s talk about the foreign prosthetic industry.

Whether the moon in foreign countries is round or not, we, as country folk, have never seen it. But I also know that in developed countries, human cost is the most expensive thing. The assembly, debugging, maintenance, warranty, etc. of prostheses all require labor costs. Therefore, I don’t believe that prostheses in developed countries in Europe and America are cheaper than those in China after assembly.

This passage also hides two meanings. First, developed countries in Europe and the United States, including Japan. If you compare the price of prosthetic limb fitting in Africa...you can find out if you are ruthless.
Second, pay attention to what I have been emphasizing, the assembly price, including after-sales service. Prosthetic limb parts are just components composed of carbon fiber, aluminum alloy, stainless steel, magnesium alloy, etc. After being assembled and debugged, the prosthetic limb is worn on the amputee. Subsequent maintenance is also a cost.

It can be seen that this netizen who posted anonymously on Zhihu is a front-line prosthetic practitioner. He wants to say to everyone from the bottom of his heart:

As a practitioner in the domestic prosthetic limb industry, I am deeply sorry for the current situation of domestic prosthetic limb fitting and to every amputee who needs to be fitted or has been fitted with a prosthetic limb.

I know that our current prosthetic services are not good enough; there is room for further decline in current prosthetic prices; and current prosthetic technology, all our domestic practitioners should blame themselves and be ashamed.

Sorry.

Unfortunately, there is not much we can do.

We can't change the selling strategies of Ottobock and Reha. They can still obtain the highest profit margins in the world in the world's largest market unscrupulously.
We cannot change insurance and social security policies, no matter how ignorant and ridiculous these documents are.
When our scientific researchers develop products, they consider "how can we make them look the same as imported products" (this is true), instead of studying why imported products are made like this?

I don’t know what you think when you see this netizen’s analysis from Zhihu. Is this really the case in the domestic prosthetic market?

When the editor read this article, his first thought was: This anonymous front-line prosthetic practitioner is telling the truth. He is a very emotional person and he wants to use his personal power to do something for this industry. It's just that his strength is too weak. Although he is engaged in the prosthetic industry, he is still a peripheral worker after all, and his energy is still limited.

What he saw was also some points in the prosthetic market, but it did not represent the entire aspect. We are doing an in-depth analysis:

Product sales path

agency mechanism. The more levels of agents there are, the higher the prices, and each level of agents has to make money. Sales channels, rentals and operating costs of prosthetic companies. Because it takes time for an amputee to wear a prosthetic limb, and constant home visits, phone calls, business trips, and hotel stays are all expenses incurred by the salesperson, so the cost of the prosthetic limb goes up, and the price will also be high.

Interest relationship

The domestic harsh business environment, high taxes, and extremely complex administrative costs. Before a prosthetic limb can reach the person who needs it, it needs to pass through many people. As the saying goes: "The goose is plucking its hair." Every person who passes through it has a benefit. In the end, all costs must be borne by consumers, and prostheses will naturally be expensive.

Product positioning

We must admit that every product has a market positioning, and some expensive prostheses are targeted at high-end customers (for example, they are affordable and reimbursed by public funds). So when choosing a prosthesis, it’s like buying a car. For example, if you plan to buy a car worth 100,000 yuan, you can choose among cars of this price. I believe there will always be the one you want.

The money you spend will feed a lot of people

When doing business, you will definitely not do a loss-making business. You must make a profit after all costs are considered. The salesman relies on commissions to make a living, and he needs to make money; the company's back-office staff needs to live, and he needs to be paid. Leaders and managers are definitely not here to play, they want to accumulate wealth; to run the company, rent, water, electricity, etc. will definitely need money. If something comes in for 100 yuan, how much do you think it should be sold for? 500 is probably too little! ! !

Buying something may not always be the same price

When buying prosthetics, don’t just ask the salesperson for how much you want. Some time ago, we published an article (quietly telling you, you can lower the price when buying prosthetic limbs like this, shhh...) to teach you how to negotiate prices. As long as the prosthetic limb company thinks it's profitable, they will sell it to you. But be careful! ! ! Black businessmen will steal and replace others! ! ! When bargaining, be sure to identify the brand and model. When installing a prosthetic limb, make sure it fits correctly.

Chaos in the prosthetic industry

Let me tell you a true story:

A new prosthetic practitioner and his business manager went to visit an amputee client in a rural area. The client was a 17-year-old boy with an amputation of his right thigh. Live in a house with a grassy roof and mud walls. Because the family was very poor, her mother ran away with someone else when he was 5 years old, and now only he and his father depend on each other. The boy really wanted to stand up. He wanted to walk. His father worked hard to earn money to get prosthetic limbs for his child.

The salesman and his supervisor recommended the prosthetic limb to the boy and discussed the price. The father and son were stunned for a long time without speaking, but it was obvious that they had already taken a liking to the prosthetic limb. The sales manager said: You can issue a poverty certificate and we can waive some fees for you (later the salesperson learned that this was actually all a ruse). Then the salesperson and business manager left.

On the way, the salesman asked the leader: Their home is so difficult, let him install it cheaper. The business manager replied: You can be soft-hearted, but you will have no food to eat, and others can sell it to him cheaper.

A few days later, the salesman called the boy's father and asked if the poverty certificate had been issued. The father said, we are already in another prosthetic company, which is cheaper than yours. Later, I learned that the prosthetic company said that they only needed to pay a few thousand yuan to install the prosthetic limb. However, when they went to the prosthetic limb company, they only made a socket. If they wanted to complete the prosthesis, they had to pay the cost of the prosthetic limb.

After hearing this story, I really wanted to curse. This reflects the chaos in the prosthetic industry. I hope this story can give everyone a warning not to be too greedy for petty gains.

To sum up some of the reasons mentioned above, we can roughly understand why prostheses are expensive. Will prosthetics be cheap? Yes! With the continuous expansion of the results of my country's reform and opening up, it has now become the world's largest economy. With Xi Jinping's "One Belt, One Road" policy and tax reform, more prosthetic products will enter the Chinese market. Localized prosthetics are also gradually growing, technology continues to improve, and products are diversified. Will definitely meet different needs.

In this society with developed Internet, the distance between manufacturers and consumers will continue to be shortened. Cutting off the intermediate links will make the price more affordable. Taobao and JD.com have done this, allowing consumers to directly benefit. I believe that the prosthetic Internet will also come. (This article was originally created by 51 Prosthetics. Please contact us for reprinting)

The prosthetic industry needs a revolution

Internet+ is worth looking forward to...

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