Looking for how to start a medical supply business? Running your own business offers unrivalled financial freedom and personal control. The problem for most business owners is keeping their company going when the economy begins to nosedive.
Unlike other sectors, selling medical equipment is largely immune to the frenetic ups and downs of the wider economy. People get sick no matter what – and they require medical equipment. Given that US healthcare profits are predicted to grow from $583 billion to $819 billion in 2027, according to McKinsey, learning how to start a medical business is a safe bet.
In fact, the US medical equipment market will outperform the sector as a whole. It was valued at $63.14 billion in 2023, with a projected compound annual growth rate of 5.63% from 2024 to 2030. As the US geriatric population continues to grow and the burden of chronic disease increases, the demand for medical equipment will only intensify.
There’s never been a better time to enter the market. Learn how to start a medical business, sell medical equipment, and other aspects of medical equipment supply businesses below.
8 Steps for How to Start a Medical Supply Business
- Choose a Business Model
- Select a Medical Niche or Underserved Market
- Find Funding to Start Your Business
- Build a Brand and Register Your Business
- Find an Office Space or Warehouse
- Seek Out a Reliable Manufacturer
- Find Qualified Employees to Sell Your Products
- Create a Website and Market Your Medical Business Online
1. Choose a Business Model
Your first step is to determine your business model. Will you manufacture, sell, or distribute goods? Who is your primary customer base? Your primary options are either to sell to businesses (B2B), e.g., distributors, hospitals, or nursing homes, or directly to customers (B2C).
There are pros and cons to either approach:
| Pros | Cons | |
| Sell to Businesses | √ Larger order volumes. √ Long-term contracts. √ Consistent demand from healthcare facilities. | × Longer sales cycles. × Heavily regulated. × Requires B2B relationships and sales reps. |
| Sell Directly to Customers | √ Faster sales cycles. √ Direct customer feedback. √ Ability to build brand loyalty. | × Smaller order sizes. × Higher customer acquisition costs. × May require more support services. |
2. Select a Medical Niche or Underserved Market
Breaking into the medical equipment supply business can be tough. Given the lucrative nature of the industry, competition is fierce. Competing with established players right away is difficult.
The best strategy is to find a medical niche or underserved market where you can excel. For example, you could develop an electric wheelchair capable of navigating stairs or create wearable health monitors designed for elderly patients with chronic conditions.
Whatever niche you pursue, get a clear understanding of the potential demand and market size. Avoid limiting yourself to the obvious products—consider medical equipment with consistent demand, such as feeding tubes, cannulas, or exam gloves, and focus on making them either higher quality or more cost-effective than your competitors.
In short, find your competitive edge. Ask yourself, what do you do better than everybody else? You could do it better, cheaper, faster, or with greater customer service. Whatever it is, that’s your unique selling point (USP).
3. Find Funding to Start Your Business
Regardless of your product, if you want to sell medical equipment, you’ll need money. Investing in research and development (R&D), renting office space, investing in marketing (e.g., websites, advertising campaigns), and paying a manufacturer will drain your finances. Without outside investment, few medical equipment supply businesses are destined for success.
Depending on the nature of your business, you may need a few thousand dollars or over a hundred thousand dollars to get started. For smaller sums, consider getting a bank loan. However, if you require a large initial investment, approach seasoned investors and venture capital firms.
4. Build a Brand and Register Your Business
Most medical equipment supply businesses are bland. Wanting to appeal to everyone, they end up appealing to no one. Considering the competitive nature of the industry, it’s sensible to distinguish yourself from your competition. That doesn’t mean being loud and annoying. You could build your brand around exceptional customer service, in which case friendliness and approachability count for everything. On the other hand, if you’re targeting fellow businesses with cutting-edge equipment, you should present your brand as professional, innovative, and trustworthy.
It’s all about being remembered. Think about your niche and consider what you’d expect from such a brand. Look at your competitors – what do they do well? What are they missing? How can you improve on their approach?
Once you’ve established your brand identity, register your business with the appropriate regulatory bodies to ensure compliance with industry standards. Federal registration should be completed with the Internal Revenue Service (IRS). To sell medical equipment, you may need a specific license. Talk to the American Medical Association for further information, or find out if you need to comply with the Health Insurance Portability and Accountability Act (HIPAA).
5. Find an Office Space or Warehouse
You’ve completed the basics of how to start a medical business. The next steps are more conventional.
Like most businesses, you’ll need a space to store inventory and manage operations. Even as an online business focused on distribution, having a physical location can be beneficial. It allows customers to view and test high-value products in person, especially when they represent a significant investment. (Remember, face-to-face consultations build trust and help you stand out from fully virtual competitors.)
In addition to your office space, ensure you’ve got the relevant equipment, including:
- Office Supplies
- Computers
- Printer
- Fax machine
- Desks and Office Furniture
6. Seek Out a Reliable Manufacturer
One of the biggest steps when starting a medical business is sourcing your products. China is one of the primary manufacturing nations, particularly in the medical equipment industry. However, Southeast Asian nations such as Vietnam are growing rapidly and becoming a major regional competitor.
Supply chain disruptions during the COVID-19 pandemic have led US companies to be more hesitant about sourcing medical equipment abroad. Nevertheless, foreign manufacturers continue to offer the most competitive prices.
7. Find Qualified Employees to Sell Your Products
Medical equipment supply businesses require employees with the right qualifications and experience. Customers often ask difficult questions that demand a deep understanding of the product.
However, product knowledge alone isn’t enough. Experience in sales, marketing, distribution, and finance is crucial to the success of any business. If you want to sell medical equipment, you’ll need a reliable team of specialists.
Consider which positions you’ll prioritise first. If you’re starting small, you might manage inventory work yourself, whereas larger businesses will need warehouse workers. As with any business, it’s about balancing your profits against your costs. But don’t leave yourself so short-staffed that you can’t expand rapidly or accommodate larger orders.
8. Create a Website and Market Your Medical Business Online
The last stage (but also one of the most important) is building your website. As an online business, your website functions as your digital storefront. It’s where customers come to learn about your products and place orders.
Having an attractive, user-friendly website is only half the battle. Getting the word out requires steady investment in digital marketing. You could create a social media campaign, pay for search advertising, or create SEO content.
Search engine optimisation (SEO) is the preferred approach for most medical equipment supply businesses. Why? Well, SEO is highly cost-effective. You can achieve substantial organic traffic from search results with a few blog posts per month. These posts establish your credibility, providing insightful information for potential customers. Not only will this build your brand awareness, but you’ll become the go-to authority for your industry. It’s an exceptional foundation for future growth.
Pay-per-click (PPC) advertising is another popular strategy. Google Ads lets you appear at the top of the search results, only paying whenever a customer clicks. It can be a sizeable investment, but it guarantees a sudden uptick in traffic. If you’re just starting out, launching a PPC campaign for a few months is a sensible option while your SEO campaign generates traction.
Final Thoughts
Wondering how to start a medical business? Hopefully, the steps listed above will get you going. Let’s recap the core points:
- Decide between a B2B and B2C business model.
- Find a medical niche or underserved market where there’s lots of opportunity to grow and establish your business.
- Look into funding options, especially if your start-up requires initial R&D to get off the ground.
- Develop a memorable brand that conveys what your business is about. It should relate directly to your product.
- Complete the business basics: find an office, seek reliable manufacturers, and hire qualified employees.
As an established medical equipment supply business, we wish you the best on your journey. Just remember the most important lesson – patients come first!
