Question

Prepare a business plan to open a surgical instruments company. This company would sell and repair surgical instruments used in surgery. This company will serve hospitals and surgery centers.

What could be the competition, products and services offered, as well as the location for a surgical instruments, scopes, and equipment company?

Answer 1

Business Plan- Surgical Instruments Company

Idea- The idea behind opening of new surgical instruments company that will sell and repair surgical instruments required in surgeries is all behind the booming health care industry. People nowadays are health freak and they want to stay fit and healthy throughout. They have become more aware on medical health care awareness and do not wish to take any chance. This industry is increasing r developing so rapidly that the number of surgeries per day had increased over the years. Hence, requirement of surgical instruments in surgical clinics or hospitals has also increased. There is less competition and margin is competitively very high in the same industry.

Scope of our project- The scope of setting up new business of surgical instruments company is based on the booming health care industry as discussed above. There is less competition and high profit margin in such industry and the volatility is also very high. The industry had been growing over years and will be growing eventually.

Market analysis- Analyzing the market carefully and getting to know about our customers. We must have proper knowledge on what instruments or equipment’s are sold by our competitors, at what rate such selling is done and what is the market feedback i.e. the feedback from the clinics or hospitals on their product. We must also know the product quality being offered by our competitors.

Services or products- We must know what products or equipment’s we would deal in. Like for any surgeries there are various equipment’s required- Scissors, Clamps, Needle, Needle Holders, Knives, Blades, Retractors, Forceps, etc. In addition to this there are more specific instruments required for different type of surgeries, like for bone or tissue surgery the following equipment’s are required in addition to the general equipment’s- bone clamps, hooks, wire instruments, tampers, tendon strippers, etc. ; for a ear instrument the following is required- plester flap knife, sickle knife, circular knife, micro ear scissors, mobilization hook, micro ear forceps, etc.

Also, we are into renting of few machines or equipment’s required in a surgery occasionally. There are few surgeries that happen occasionally and the equipment or machine is very expensive. The hospitals and clinics do not wish to outright purchase such equipment. In that case we provide the service of renting out for the specified time period so that the surgery can be done. Repairing of existing surgical instruments is also one of our chain or services.

Data collection- We will need to check what instruments are required by the surgical clinics and hospitals for different categories of surgeries. What is the current market rate of such instruments and what will be our rate to purchase such instrument. We will analyze who will be our competitors and what rate are they quoting for all different categories of surgical instruments.

Data analysis- To determine whether are project will survive or fail, we need to analyze Net Present Value of the project. NPV is calculated based on the assumptions of cash flows. The cash flows will be determined by collecting the data of competitors and analyzing such data, studying the financial statements of our competitors for last 15-20 years and there profit statements and doing financial modeling. Once such analysis had been done at higher level we calculate the NPV of our project which will determine whether or not our plan of opening a surgical instruments company which will provide instruments to surgical clinic and hospitals will be a success or a failure

Planning- Based on our data analysis we will be able to make out whether we should manufacture certain surgical equipment’s or purchase it. There are various surgical equipment’s required at time of surgeries like- Scissors, Forceps, Needle Holders, Needles, Blades, Knives etc. Few of them can be manufactured directly and rest purchased. We will have to determine which product or equipment needs to be manufactured and which product of equipment needs to be purchased. Such analysis will only be done once we estimate the cost involved for each instruments, the manufacturing cost and purchasing cost of each instrument, thereafter deciding whether such instrument will be manufactured or purchased. The best of the production or procurement technique will be chosen which would increase the profit margin when selling it out to the clinics or hospitals.

Execution of such Planning- In case of manufacturing of a certain surgical instrument, we need to make list of machines and techniques required for the manufacturing, raw material required for such manufacturing, purchasing of such raw material from best suppliers, hiring of skilled personnel, safety measures, time taken in manufacturing of a product, quality check of the finished product, warranty of the product, etc. In case of purchase of a surgical instrument we need to ensure that such purchase is being made from a reliable source, the quality of product is good; the price is lowest and most important hiring of the personnel who will look after all the matters related to such purchased.

Marketing and Sales- We must ensure that marketing of our product is done in the right manner. We must advertise our product via various different channels like- hoarding, television advertisements, radio advertisements, etc. When dealing in variety of surgical equipment’s are focus will not be only on hospitals and surgical clinics but also approaching doctors, they would refer us to various other places if satisfied and boost our sales. Our sales force should be properly equipped with all line of product and services being offered and what is the use of the product and when is such product used. Approaching pathological labs that are also connected to huge chain of hospitals and clinics will also help us boost our sales and generate revenue as they might also get us introduced to various related clinics and hospitals.

Location- We must be located at the center of the city which will get good connectivity across the city with short span of time. As there are numbers of hospitals and clinics situated across the city and our focus will be on major or all of them and not just few in specific locality. Being in the center will also help our sales team to reach various doctors who sit at multiple chambers at different time and also going to pathological labs situated at various places on regular basis.

These are the set of activities and analysis which will be performed by us for setting up our new surgical company which would provide instruments to the clinics and hospitals and also repair the instruments when required.