From the October 2011 issue of HealthCare Business News magazine


Another ongoing trend in the sector has been consolidation. “We’ve seen some people go out of business because they just can’t make it in terms of being mature,” says Suffridge. “I think that consolidation has brought maturity and some folks who aren’t mature just can’t stay involved anymore.” ReMedPar is just one example of the consolidation that has been taking place within the sector; the company was acquired by Aramark Healthcare earlier this year. Similarly, AllParts Medical, another parts provider, was recently purchased by Royal Philips Electronics.

Jozef Pelikan, a parts and logistics analyst for JDI Solutions, has been observing an increase in the demand for parts. French has been noticing that many parts manufacturers are moving away from stocking distributors, which is requiring his company to expand their inventory. “Most companies do not want to sell us 10 or 15 pieces now, they want us to buy a pallet, or larger quantities,” he says.


Woodward has taken note that OEMs are building systems that are “plugged in place” and have increasingly complex technology.

“In order to troubleshoot, you don’t fix anything, you replace it,” he says. “For those companies who don’t have a working agreement with OEMs, I believe it’s going to be a lot harder for them to get parts. On the service side, it’s going to be a lot harder for those organizations to [provide] their service if they don’t have some kind of agreement or some kind of working relationship with the OEMs. A lot of the systems now, you need proprietary test software and if you don’t have that, you really can’t do your job. So the trends I see are more innovation in the systems, more sophistication in the electronics and less and less mechanical pieces.”

Challenges are part of the business
When hospitals decide to take their services in-house, there are a number of issues they need to be aware of and challenges to address says Kramer. “They have to think about what kind of equipment they have and what kind of third-party support is out there. When a [facility] decides to do that, when they get away from the OEM, they’re no longer getting the support of that OEM, and certainly not at a very good price. So, for instance, if somebody has a CT [with an OEM service contract] and they decide they don’t want to have someone service it anymore, they will have to make sure they get a solid partner who can provide training if needed, who can provide them with the back-end support, technical support.”

According to Suffridge, one of the main challenges facing the sector is the demand for parts of the highest quality without the matching price-point. “We see a lot of quality issues in the industry, just from a parts perspective,” he says.

October 2011 Magazine

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