Market research and analysis is essential for the management and operation of the hospital or any other organization as far as production, distribution of goods and provision of services are concerned. Market research is an organized effort to gather information about the target market or various customers hence forms a very significant component of a business strategy. In the situation where the hospital wants to create awareness about the product and services they do, they will tend to articulate the research problems and objectives, develop the overall research plan, and indulge in the collection of data. Besides, they will carry out an analysis of the data, and finally, make the best use of the data after the presentation process is done. Therefore, to open up an ultrasound business in SeattleWashington, there is a need to carry out the market research about the products and services which the hospital wants to provide or offer to the market, conduct the market analysis, forecast the revenue streams as well as the sales forecasts of the hospital over a given period.
In the situation where the entrepreneur deems to start a hospital which will offer the outpatient services as well as other health services to the physicians and midwives, there is a need to develop a market research which shall propel efficient service delivery and prove to the clients that they are one of the new hospitals which have the best physicians (radiologists, OBGYN MDs), midwives and a team of employees who can offer proper services to the people in Washington and beyond. Besides, it will help the hospital to create awareness about the products and services they offer for the betterment of the clients livelihood. For instance, the hospital provides competitive insurance services which can aid in covering the risks that affect the patients who could not be able to pay for their services. It will also cover the hospital and the patients against the risks which might affect the operation and treatment process. Besides, the market research will give the hospital a picture of what kinds of the new products and services they can provide to aid in improving the performance and generate more profits to the hospital (Ereaut, 2002).
In addition, the research will enable the hospital to understand and comprehend whether the services they offer to the patients meet their expectations and ensure that the necessary adjustments are made so as to satisfy the needs and obligations of the hospital and the patients either in the short or long run. There are various types of market research in which the hospital should carry out before they launch their venture or during their venture. The first one comprises of the primary research which involves the gathering of information about the sales and the effectiveness of the hospitals practices. It also consists of the activities such as collection of data through interviews, surveys, questionnaires, and focus groups for analysis (Films Media Group et.al, 2016). The second type of data the researcher should collect is from the reliable secondary sources about the performance of the competitors in the region and defines the market gaps which the hospital need to bridge. These will ensure that the hospital adjust their operations hence leading to efficiency in the provision of services either in the short or long run.
However, during the market research, there is a need to take caution about some of the factors which can make new venture to fail. These factors include over reliance on the secondary research since some of the information got from these sources can be outdated. Besides, the researcher should avoid the use of the web sources since these sources do not provide detailed and concrete information which can be used during the decision-making process. Besides, the hospital research team should not survey only the people they know, but rather they should ensure that they interview the family members, friends and those who are close to them. The survey should be carried out in the market so as to avoid biases.
Market Analysis of the Hospital
Market analysis is the qualitative and quantitative assessment of the market. It tends to identify the size of the market both in value and volume. Also it clarifies the customers' segments and their consumption patterns, the level of competition as well as the economic environments which consist of the regulations which can prevent the operation of the hospital and the barriers to market entry (EGi (Firm), 2000).
Demographics and segmentations
The approach in assessing the market mainly depends on the whether the entrepreneur wants to go global or regional. In this case, the business person wants to open a hospital which shall serve the region of Seattle Washington. Therefore, there is need to carry out the market assessment at the national level. In this case, given the competition in the market, the hospital aims at channeling their resources in the provision of services to the referrals from physicians, midwives and insurance carriers. In this case, there are two main factors which should be taken into consideration when assessing the size of the market (EGi (Firm),2000). These comprise of the potential customers or population of midwives and physicians who shall seek medication in the hospital and their respective market values. During the determination of the market value, the hospital should ensure that they determine the industrys value, a figure which can be used to forecast the hospitals sales over a given period. Thereafter, the hospital should determine the estimates by either adopting the bottom up approach or the top down approach. The market value can be determined by the following formula
Market value =Volume of the transactions * Value of 1 transactions.
The target market
It comprises of the type of patients who are being targeted in the market. In the case of the new hospital, the main focus is put on the physicians, the midwives and other patients referrals who have received the ultrasound services from the hospital. These will be the main drivers of demand in this case. For instance, the main value of demand in such a situation will be the volume of revenue to be garnered as compared to the quality of services which the patients and other clients receive in the hospital.
Needs of the market
In this case, the hospital needs to know the drivers of the demand for the health care services in the region in which they want to venture. To achieve the competitive edge, the hospital should ensure that they provide a better and efficient healthcare than their competitors. In the situation when the hospital have understood the needs of the people, then they will stand a chance to attract a larger market share given that they will be responding to the needs of the people.
Level of competition
The evaluation of the competitors in the healthcare industry is very important since it will tend to tell the entrepreneur the modalities which they can put in place so as to ensure that the needs and obligations of the hospitals are met (EGi (Firm), 2000). There is need to identify the positioning of the competitors as well as their strengths and weaknesses. These should be aligned with the strategies as well as the competitive edge of the hospital. Besides, the business should analyze the competitors angle so as to identify the weaknesses which they can use so as a result to achieve the hospital's competitive edge. These can only be achieved through bench making the competitors against the drivers of the demand.
Barriers to entry and the regulatory measures
There are various regulatory measures which can be used in the determination whether the business will operate or not. These regulations may include the environmental laws, consumers Act and Health and Drug Act (Ereaut, 2002). In the situation in which the hospital does not meet any of these laws, then there is a need for the company to develop various strategies which shall ensure that the rules, regulations, as well as the principles, are adhered. On the other hand, there are various barriers which can influence the performance of the hospital in the market. These include the funds which are needed for investments, the level of technologies, the type of brand of the good or the service, access to the distribution resources and the distribution. Therefore, the hospital stands a chance to eliminate these variables hence achieving the hospitals goals and objectives and goals.
Revenue streams and Forecasts
In the process, the hospital tends to be generating the revenue to the owners both in the short and long run. Given that there is no hospital in the region which provides the medical services to the referrals made by the physicians and midwives, the hospital stands a chance to get a high amount of revenue from both the inpatient and outpatient. The data has been benchmarked with that of the National Bureau of Statistics (Ereaut, 2002). The breakdown can be described as shown in the table below:
Forecasted Revenues for the Hospital
Amount in Million
Year 2017 2018 2019 2020
Revenues In-patient 150 153.0 156.1 159.2
Outpatient 202 206.0 210.2 214.4
Total revenue 352 359.0 366.2 373.5
Less: Cost of Sales 54 55.62 57.2886 59.007258
Gross Profit 298 303.4 308.9 314.5
Less: Total expenses 98 100.94 103.9682 107.087246
Net before Profit 200 202.48 204.964 207.450712
Tax at 35% 70 70.9 71.7 72.6
Profit after tax 130 131.6 133.2 134.8
461645140462000In this case, the revenue is assumed that the growth rate of revenue and expenses is 2% and 3% respectively. The hospital has shown a greater performance given the incline in the value of after-tax revenue, a process which shows a good progress for the company over a given period. The inclining trend can be depicted as shown in the figure below:
It conclusion, the establishment of a hospital in the Seattle Washington is a very viable idea and is prudent since it provides proper services which currently lacks in the region. Besides, it will create employment for the people living around it hence an improvement of societal welfare. The viability is also justified by the growth in the projected revenue as well as the improvement of service by the insurance carriers which uses the submittal process to set up contracts with the medical scan providers.
EGi (Firm). (2000). Market analysis. London: EGi's London Office Database.
Ereaut, G. (2002). Qualitative Market Research: Analysis in Interpretation in Qualitative Market Research. London: Sage Publications.
Films Media Group,, & Teletime Video, Inc. (2016). Market Research.
Ranchhod, A., & Gurau, C. (2007). Marketing strategies: A contemporary approach. Harlow: Financial Times Prentice Hall.
U.S. and Foreign Commercial Service. (2000). Market research. Washington, D.C.: U.S. Commercial Service.
If you are the original author of this essay and no longer wish to have it published on the collegeessaywriter.net website, please click below to request its removal:
- Essay Example on Management Secrets of Korean Admiral Yi Sun-Sin
- Essay on Subordination Among the Organizations Staff
- Supply Chain Management Essay: Internal Process Analysis in Chipotle Mexican Grill and McDonald's
- Analysis of Trait Results: A Leader's Personality - Paper Example
- Research Paper Example on Management Control Systems
- Essay Sample: The Importance of a Reasonable Plan in Teamwork
- Walmar Analysis - Paper Example