TR Life Sciences Sees Hospitals Expanding Internationally in Order To Focus on the Optimal Marketing Mix

TR Life Sciences a hospital management consulting firm has noted that because of the booming growth, many Indian hospital entrepreneurs are wanting to spread their wings to other countries. They intend to leverage their strengths in global markets, especially in nations that have high per capita income but lack good healthcare infrastructure. According to Raj Sehgal, associate director, Delhi-based TR Life Sciences, a leading hospital management consulting firm: “Done right, cross-border expansion can offer phenomenal rewards for hospitals, as countries around the world welcome foreign investment and expertise in healthcare, opening the door to their markets and pool of patients.

Global presence can enhance the value of an Indian hospital brand and earn the trust of overseas patients. "Hospitals need to keep patients at the center and structure all services. This might require new modeling of marketing mix and technology to develop the service offerings. In a foreign country, the marketing team is best advised to focus all efforts on creating an effective marketing mix, rather than trying to influence the environmental variables. “The new entrant must consider all components of the external marketing environment, such as social, demographic, political, legal, and competitive landscape, before establishing a presence in a new land. A very important variable is the payer system (insurers) analysis. This profoundly impacts the way hospitals can operate in a country,” said Sehgal said. According to him, several steps need to be taken when a hospital operator decides to establish a global footprint.

These are choice of the country. There is need to undertake due diligence of the host country. This entails evaluation of the market size and the growth opportunity it offers for a hospital business, the existence of supply chain, local competition, availability of technology and IT infrastructure, quality of physical infrastructure, regulatory policies and laws, and availability of human resources like doctors, nurses, paramedics, and IT professionals, he said.

“Hospital expansion abroad can come in many forms. These include expansion through mergers and acquisitions (M&A), joint ventures, export of services, licensing the brand to local entrepreneurs (franchising), taking management control of existing hospitals, managing one or more departments such as oncology or cardiology of local hospitals by outsourcing, and 100% ownership projects. The entrepreneur needs to choose the one that best suits the business objectives and capital availability, said Dr Sharan.