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Further squeeze profit margins

Private clinics, therefore, the market in general will give priority to with monomer doctor practicing small clinic, large chain brand market share is very difficult to do it is too high, and the industry profit margins will be lower, blindly copy may increase losses, so in general, a private clinic is still a relatively small regional business.


The same is true in China, where the majority of the more than 180,000 clinics are small, single-doctor clinics that don't have the capital to operate. However, in the larger outpatient department, most of them are also single-unit outpatient department. Only in recent years, part of oral cavity and traditional Chinese medicine has been interlinked. General subjects and specialties dominated by basic medical services have not been developed yet, and the future chain will also face challenges.


One thing Hong Kong and China have in common is that commercial protection is relatively weak. Nearly 70 per cent of Hong Kong's private system health spending is paid by individuals, 14 per cent by individual commercial insurance (just in hospital) and 14 per cent by corporate group health insurance. This is not a high proportion, usually only large companies buy such benefits for their employees, and small and medium-sized enterprises do not provide group benefits. However, the insurance in Hong Kong only covers hospitalization, and does not include outpatient service. Therefore, the private basic medical treatment mainly relies on self-expense, and the pricing is within the range of individual users.


But even ignoring the weak state of commercial health, it would be much harder for a leading chain of clinics like Hong Kong to operate on the mainland than it would be if it had single-digit market share and could list. On the one hand, there is a serious shortage of general practitioners in the mainland, and there is no system of first-round general practice, which cannot divert patients to general practice, not to mention the practice of obtaining higher gross profit from general practice referral to specialist. Second, public hospitals have to turn to private clinics because it is difficult or even impossible for them to see common subjects in a public system like Hong Kong. Third, the mainland has a certain brand quality chain of clinics in the pricing of high-end, not suitable for running.


Therefore, no matter judging from the commonality of medical service industry or the characteristics of its own market, clinic will still be a decentralized regional service industry in the future, with a relatively low profit margin, and the scale will face certain challenges. It is more likely to be a satellite of a hospital, or a chain of service providers in an area where regional characteristics and store differences will be evident.



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