Industry Analysis & Industry Trends
The past five years have been rocky for the Medical Device Manufacturing industry. Despite the indispensable nature of medical devices, the recession, coupled with slower growth in total health expenditure and capital investments, took a toll on a number of operators. As a result, a wave of large medical device manufacturers closed underperforming plants. The exodus has been largely attributed to the lack of incentives to grow and develop in this market, as well as regulatory pressure. Indeed, some international companies have avoided entering the Canadian medical devices market due to this difficult operating environment. During the five years to 2013, IBISWorld estimates revenue will contract at an average annual rate of 3.6% to $3.8 billion... purchase to read more
Industry Report - Industry Investment Chapter
The industry has a medium level of capital intensity; for every $1.00 spent on wages, $0.06 is invested in capital improvements. Medical device manufacturers produce a range of products for highly specialized applications. Not all products can be manufactured on an automated production line, so the need for hands-on work increase labour costs. Skilled specialists are needed to research and develop medical devices, and these employees command salaries well above the manufacturing sector's average wage. Wages account for about 31.5% of revenue.
Depreciation costs represent about 1.8% of revenue. The larger firms within the industry frequently acquire small firms to broaden their range of products and markets, which raises capital expenditure... purchase to read more