Private Investors ascent in the Chinese Dental Services Market
Coming out of the pandemic, the Chinese economy was among the earliest to bounce back to pre-COVID levels. FY 2021 the Chinese economy continues to roar, although the Evergrande fiasco in Q3 2021 has shown a different side of the facade.
However, looking at the bigger picture, which rather portrays a sense of relief, confirms that the macro indicators are performing just fine. There isn’t just an increasing awareness of dental health and aesthetics among the Chinese population, but also the governmental policies are becoming increasingly favorable for private players, coupled with better insurance coverage.
If we focus on the dental services segment in the country, the market is still unpenetrated and highly fragmented. Presently, the size of the Chinese dental services category is approximately 20 percent of the category size in US (in terms of dollar value). However, in terms of the number of treatments performed, the size of the Chinese dental services segment far outsizes that of US market.
Consolidation and rise of specialty dental chains is another trend that shows no signs of slowing down – thanks to favorable governmental regulations & private investment in the space.
Each year up to 3000 new dental practices are opened in the country. The average time to start a dental office once the site has been selected averages between 4-6 months. Whereas on the other hand, the lead times concerning the start of dental hospitals are significantly longer – due to tighter scrutiny and higher regulatory barriers.
Consolidators and large dental chains across the country are especially trying to optimize their revenue mix by increasing the share of high-margin and high growth treatment services such as implants and orthodontics. More than 70 percent of the dental services in FY 2020 were performed at public dental hospitals and offices. However, this is another trend that’s undergoing an overhaul as the private services sector expects to grow +15% CAGR over the next 5 years.
Each year up to 3000 new dental practices are opened in the country. The average time to start a dental office once the site has been selected averages between 4-6 months. Whereas on the other hand, the lead times concerning the start of dental hospitals are significantly longer – due to tighter scrutiny and higher regulatory barriers.
Consolidators and large dental chains across the country are especially trying to optimize their revenue mix by increasing the share of high-margin and high growth treatment services such as implants and orthodontics. More than 70 percent of the dental services in FY 2020 were performed at public dental hospitals and offices. However, this is another trend that’s undergoing an overhaul as the private services sector expects to grow +15% CAGR over the next 5 years.
This article was originally pubslished by insightsZ on the day of Oct 12, 2021. You can find the link to the original article here: https://www.insightsz.com/post/private-investors-ascent-in-the-chinese-dental-services-marke