PART 1: Fragmentation report on medical supply industry (Medical Supply Distributors).
Hello! Thanks for your question about the fragmentation of the medical supply distribution/wholesaling industry in the United States. The most useful sources we found to answer your question are IBISWorld, Hoovers.com and Census.gov.
The short version is that there are 12,970 firms in the U.S. medical supply wholesaling industry. Of the $187 billion-revenue generated by the industry, 75% is accounted for by the top 50 firms while the rest is accounted for by the smaller firms. The top 10 players' share of the industry revenue is around 21%.
Below you will find a deep dive of my findings.
NUMBER OF FIRMS IN THE INDUSTRY
Based on IBISWorld's January 2017 report on medical supplies wholesaling in the United States, there are 12,970 medical supply wholesalers in the country.
Census.gov provides summary statistics of firms in the medical supplies wholesaling industry too, but the data are for years 2002, 2007, and 2012 only. This is because the economic census is conducted every 5 years. Among links to economic data in the Industry Statistics Portal for NAICS code 423450, which is the code for medical, dental, and hospital equipment and supplies merchant wholesalers, the following table appeared to be the most relevant:
'Wholesale Trade: Subject Series - Estab & Firm Size: Summary Statistics by Sales Size of Firms for the U.S.: 2012, 2007, and 2002'
According to this table, the number of firms in the industry with NAICS code 423450 was as follows:
2002 - 6,574
2007 - 7,197
2012 - 7,487
Revenue from medical supplies wholesaling in the United States reached $187 billion in 2016, according to IBISWorld.
This appears to be consistent with the following revenue figures provided by Statista:
2009 - $134.8 billion
2010 - $140.19 billion
2011 - $145.8 billion
2012 - $151.63 billion
2013 - $157.69 billion
2014 - $164 billion
These numbers are comparable as well to the following sales figures in the Census.gov website:
2002 - $80.4 billion
2007 - $126.8 billion
2012 - $162.9 billion
Hoovers.com has an overview of the medical equipment and supply wholesalers industry, and, according to this overview, the medical supply wholesaling industry in the United States is concentrated with 75% of industry revenue accounted for by the top 50 companies.
In the Hoovers company database, there are 1,091 medical supply wholesalers headquartered in the United States. Of these 1,091 firms, 13 generate at least $1 billion in revenue. You may see how these 1,091 firms are distributed by revenue size in the Hoovers tab of the spreadsheet below. The top 10 wholesalers are shown as well. Their revenues total to around $39 billion or approximately 21% of the $187-billion industry.
In addition, as can be seen in the Census.gov tab of the spreadsheet, historical data from Census.gov indicate that 131 out of 6,429 medical supply wholesalers that operated for the entire year of 2012 each had a revenue of at least $100 million. They accounted for 84.22% of the combined revenue of the 6,429 firms. In 2007, the percentage was 61.56%.
It appears from Hoovers' overview and IBISWorld's report that the key players in the industry are Cardinal Health, Owens & Minor, Henry Schein, McKesson Medical-Surgical, and Patterson Companies. Both Cardinal Health and Owens & Minor are listed in the IBISWorld report while Henry Schein, McKesson Medical-Surgical, Owens & Minor, and Patterson Companies are mentioned in the Hoovers' overview.
The revenues of these five companies are listed in the Key Industry Players tab of the spreadsheet. Their revenues alone total to around $151 billion. Cardinal Health's $121.5 billion-revenue is inclusive of revenues from distribution of both pharmaceuticals and medical supplies, though.
To wrap it up, there are 12,970 medical supply wholesalers or distributors in the United States. Together, they generate $187 billion in revenue. The medical supply wholesaling industry is concentrated rather than fragrmented with 75% of industry revenue is accounted for by the top 50 players in the industry. Around 21% of industry revenue is captured by the top 10 distributors.
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