GTM4Health – Business Models

“Tough to sell this as a stand alone sale.??This is best sold as part of a bundled offering” quipped the distributor when we were discussing our incubatee’s tech solution.??Each solution needs a different model of selling based on various parameters. ?Read on to know more about Business Models for HealthTech Solutions.

1.??Capex Model/One Time Buy ?Model :

• Usually “Must have/Must buy” ?equipments/infrastructure are bought in this model. Financial Institutions also aid in purchase of this.
• Never will new /untried solutions be purchased in this manner.
• Large Cash Outflow in one go is one disadvantage for the buyer.
• New Hospitals /Labs like this model since they have budget when they start a venture or will raise loans for their projects.
• AMC/CMC are part of Capex Sales for maintenance and support.

2. Pay Per Use Model :

• New solutions usually will be tried in this manner, since the risk is controlled.
• Cash Outflow well controlled.
• ?Can stop service anytime.
• Flexibility : Can increase / decrease usage.

3. Subscription Model (SaaS) :

• ??A monthly fee for a range of services for a set number of users.?You get charged whether you use it or not.? Other criteria :?The SaaS Model pricing must be considerably less than Ownership Model over X years.

4. Consumables Usage Model :

• One way it could be tried is the Hardware is placed at hospital (Lease model).?Whenever tests of a particular kind are ordered, the consumables of this solution are used.?Prices are set to ensure there is value for all players in the chain.
• Most times lab analysers are sold in this model, where the reagents are the consumables, the lab orders regularly.

5.??Rental Model :

• Used to get a foot in door of customer with easy business terms.??Easy to start small engagement.???In some ways its Similar to Pay Per Use model.
• Used with Minimum Finance commitment < 3 months>?:?Win- Win

6. Bundled Offering Model :

????When large equipments are bought (Ex: A new hospital orders), sometimes, light weight items are bundled as part of the offering and delivered to customers.???This way the distributor maintains his/her margins as well as delivers new solutions to customers.??Customer doesn’t feel extra costs being added to his billing.

Summary : Understand where your product fits in at a particular market, is key to choosing the right model.?Early days, attempt a Pay Per Use/Rental Model to validate, later graduate to Capex + AMC Model.??

#GTM4Health #Healthcare?#Sales #GoToMarket