Healthcare Import/Export: Challenges and Solutions
November 22, 2022
When it comes to healthcare import-export, there are specific facts you better be aware of.
Global supply chain disruptions during the pandemic significantly impacted the healthcare products industry. As a result, governments responded by implementing policies to help support the import and export of medical goods and services. According to the World Bank, these measures “increased average trade costs of medical goods by about 60 percent.”
These effects continue today as the landscape for the global importing and exporting of healthcare products still requires more significant measures to mitigate supply chain difficulties.
To keep up with inventory management and economic challenges, healthcare businesses, both for-profit and non-profit, like the IDA Foundation, need to understand as much as they can about the importing and exporting of medical supplies.
Medical Supplies Imported and Exported
Statistically, most of the import and export of medical equipment and medical supplies wholesale fall into one of these categories of HS codes, 9018, 9021, 9022,9019, and 4015. Instruments, appliances, and apparatus are among the most traded healthcare products globally.
What are the top imports and exports of medical supplies?
- 1. Medical, surgical, dental, and veterinary instruments, and appliances
- 2. Electro-medical apparatus
- 3. Sight-testing instruments
- 4. Parts and accessories for scintigraphic apparatus
- 5. Orthopedic appliances
- 6. Artificial body parts and teeth
- 7. Hearing aids
- 8. Crutches, belts, trusses, and splints
- 9. Bone plates, screws, and nails
- 10. Pacemakers
- 11. X-ray supplies such as x-ray tubes, x-ray generators, control panels, desks, screens, and chairs
- 12. Mechano-therapy
- 13. Artificial respiration appliances & apparatus
- 14. Ozone, oxygen, and aerosol therapy
- 15. Vulcanized rubber articles of apparel & clothing accessories
Which nations rank first for importing and exporting healthcare?
According to a report from globalEDGE in 2019, imports and exports from USA healthcare companies ranked first globally. China ranks second due to global healthcare economies deciding to export medical devices to China.
Top 10 Healthcare Import Countries
- 1. United States
- 2. China
- 3. Germany
- 4. Netherlands
- 5. Japan
- 6. France
- 7. Belgium
- 8. United Kingdom
- 9. Italy
- 10. Canada
- 1. United States
- 2. Germany
- 3. Netherlands
- 4. China
- 5. Ireland
- 6. Switzerland
- 7. Mexico
- 8. Belgium
- 9. Japan
- 10. France
- 1. Engage in negotiations with suppliers
- 2. Factor invoices
- 3. Encourage customers to pay early
- 4. Consider taking out a small business loan
- 5. Invoice Financing
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Top 10 Healthcare Export Countries
What are the difficulties of importing and exporting healthcare products?
Several factors have contributed to difficulties in the international trade of medical supplies and other healthcare-related products. To import and export medical devices, wholesale medical supplies, wholesale medical supplies, and other healthcare products, businesses must be able to negotiate an array of trade policies established by worldwide governments, including tariffs, import costs, and rising energy prices.
The WTO, the World Health Organization (WHO), and the World Intellectual Property Organization (WIPO) have been working together to address difficulties associated with importing and exporting healthcare products.
These institutions explained in a joint statement, “International trade is vital for access to medicines and other medical technologies, markedly so for smaller and less-resourced countries. Trade policy settings — such as tariffs on medicines, pharmaceutical ingredients, and medical technologies — directly affect the accessibility of such products.”
For improvement to the international trade system to occur, countries must work in cooperation, reduce tariffs and import fees, and improve their transparency with their trade policies. In the meantime, healthcare businesses must keep current on how this confluence of international policies impacts their ability to trade worldwide.
How to manage cash flow and supply chain requirements
It can be challenging for businesses to manage their cash flow and meet supply chain requirements. Often the cash flow of income received by accounts receivable from customers and additional sources doesn’t align with the schedule of payments going out of the account payable to suppliers.
Businesses need to develop a strategy for building sufficient working capital. This cash reserve can bridge the gaps between lapses in cash flow into the company.
However, managing supply chain cash flow in today’s economic conditions can be challenging. For example, a company may not receive incoming payments if its products haven’t left the shipping container due to port congestion or delays. Unfortunately, the suppliers still expect to be paid on time.
When it may not be enough or feasible to generate a significant cash reserve, businesses need to look to other methods to keep the cash flowing as steadily into the company as it’s going out.
5 ways to increase cash flow to meet supply chain requirements
There are a few ways that you can increase cash flow so that your supply chain can run smoothly. Consider these ways and which ones can benefit your processes:
Engage in negotiations with suppliers
The first step in mitigating this cash flow gap starts with reaching out to your suppliers. Most suppliers will work with businesses and negotiate for extensions on your payment schedule.
It helps to be on good terms with the suppliers before communicating your needs. Establishing trust in your ability to keep your end of the bargain can facilitate working out a deal or extending your terms.
Factor invoices
Factoring can help with cash flow deficiency. Use online factoring services to help make this process more efficient for your company and your customers. Onboarding is usually easy and the process is speedy.
Encourage customers to pay early
Provide a discount or an incentive to encourage your customers to pay early. Although not all your customers will agree to it, it’s worth the attempt. Gaining these funds ahead of schedule can give your cash flow the boost it needs.
Consider taking out a small business loan
Although it may seem like an extreme step, a business loan can bring in cash flow now, when you need it. However, the process of applying for a small business loan is not always straightforward as it may involve lots of KYC and compliance checks. If you think this is the best option for your business, you can create a short-term loan for only the amount you need to cover the gaps in cash flow.
Exporters can benefit from Invoice Financing
As an exporter selling healthcare products and medical goods, did you know you can benefit from invoice financing? When you sign up for invoice financing, you’ll have 90% of the invoice value paid immediately after you ship the goods. The outstanding 10% will be given back to suppliers once the buyer has paid back the provider. This one simple step frees funds so you can re-invest your money to pay your suppliers, compensate your employees, and finance your next production cycle. As a result, you can scale up your business faster and more efficiently. Learn more at incomlend.com.
