Analysis of medical tenders and contracts

Manufacturers supplying medical products to healthcare units, who want to enter a new market or consider a change of their distribution model, face a severe challenge – they must develop a sales strategy tailored to the specific market. Therefore, they need detailed information on the structure of the target market (competition, product portfolio, prices) and the method of organizing purchases in medical facilities.

CIVITTA supports companies operating in the medical industry that are interested in Central and Eastern European markets by conducting a comprehensive analysis of medical tenders and contracts and thus providing data necessary to develop a sales strategy.

What is an analysis of medical tenders and contracts?

The analysis of medical tenders and contracts is carried out within clearly defined categories of products and consists of two stages:

1. Analysis of medical tenders. The project begins with a review of all tenders announced by hospitals for medical products that are in the scope of the project. The database is prepared by using notices on the tenders’ results published in the bulletins of public procurement (national and EU level). At this stage, we obtain data on how much and what kind of medical equipment/devices are hospitals purchasing.
2. Analysis of medical contracts. It is carried out based on documentation obtained from hospitals. We cover up to 70% of contract documentation, which is sufficient to estimate the structure of the market. The result of the analysis is information on the brands and models of purchased medical equipment/devices and the unit purchase price.

The scale, scope and complexity level of the project depend on several factors:

• Characteristics of the target market – the scale and difficulty level of the project are determined by the size and structure of the market, as well as availability and transparency of public data. In countries having the majority of private hospitals and not having adequate legislation regulating access to information on public purchases, the process of obtaining data from tenders is more complicated.
• Categories and subcategories of products, with definitions – categories define the scope of the final database and the level of detail for further analysis. The report covers only tenders containing products from the list of categories specified with the client. It is crucial to precisely define the categories and products which should be included in the research, as well as provide alternative names that may be used by hospitals in their tenders.
• Keywords – a set of keywords is established after defining the categories and used to create the initial tenders’ database. In the early phase of the project, we prepare keywords based on the list of categories and we send it to the client asking for the acceptance. It is worth to exclude from the analysis of all words that are often used together with the keywords, and do not belong to the scope of the study. By using the exclusions, it is possible to reduce and specify the initial database.
• Time range – is defined based on the dates of closing the tenders. Due to the length of tenders, a complete picture of the market can be built by analysis covering at least two years.

Who benefits from the analysis of medical tenders and contracts?

Analysis of medical tenders and contracts provides valuable information that helps companies make data-driven business decisions at various organizational levels and with external distributors.

By using the tenders’ analysis, the management board can develop:

• growth strategy thanks to data on the size, value and structure of the market, as well as the potential of cross-selling,
• sales strategy together with a decision about running own sales and cooperating with distributors,
• pricing policy based on information about competitors' activities and prices,
• structure of sales teams thanks to data about customers and regions.

The sales department can use data from the analysis of medical tenders for:

• conducting market segmentation based on results of attractiveness analysis and detailed data about purchasers,
• setting sales targets based on historical data, e.g. prices and frequency of purchases,
• increasing sales effectiveness by providing sales representatives information on purchasers and by planning visits in hospitals with the tender schedule in mind.

Distributors cooperating with a company can also use the analysis:

• to coordinate joint sales activities,
• to establish a sales policy for mixed distribution models.

The approach used by CIVITTA allows companies to obtain data necessary to develop sales strategy and pricing policy for a given market. Analysis of medical tenders and contracts also provides detailed data useful in the daily work of sales teams.

Review sample research and consulting project of tenders’ analysis conducted for a manufacturer of medical equipment.