Why should a Swiss SME be interested in the Eastern European MedTech market? Where do you see the biggest potential?
The East European market definitely has potential for growth, despite economic challenges and regional political sensitivities. There is a very clear need for high-quality medical technology. Our local partners are finding that demand from users (i.e., GPs, pharmacies, hospitals) and patients is constantly increasing due to steadily improving levels of knowledge. In my opinion, Poland and Czech Republic have huge potential, but Serbia, Croatia and Hungary should also not be forgotten. I have the impression that most entrepreneurs there are hungry and want to expand.
Do you see differences between the various markets? What distinguishes them?
The differences in the individual markets are significant. Almost every country has its own language, or even several. Negotiations with the local distributors are usually in English, but when it comes to training and presentations for customers (GPs, pharmacies, hospitals), communicating in the local language is simply a must. The instruction manuals must also be available in the local language.
The markets vary greatly in their size and potential. Poland, for example, has 40 million inhabitants and a stable economy. Its proximity to Germany and excellent transportation links to Western Europe mean that competition is very strong at all levels. The same applies to the Czech Republic and Slovakia. Romania, on the other hand, has over 20 million inhabitants, but a weak economy. Slovenia is almost at the level of Western Europe with regard to purchasing power, but has only 2.5 million inhabitants. Serbia is very difficult in terms of registration, but it is still possible to be competitive there.
When it comes to local tenders in particular, I think it is definitely an advantage to work with local distributors.
How did Microlife AG proceed when entering of the Eastern European market? Did you have to adjust your business model or adapt your products to market conditions?
In Eastern Europe we decided to work with partners. The following criteria were decisive for us when selecting a new Partner: One local partner per country, if possible
- Owner-run enterprise, if possible
- Own sales team with sales representatives in the field
- Local customer service department
- Own marketing department
- Good network
- Direct sales to customers, such as GPs, pharmacies, hospitals
- Existing assortment from the local distributor
- Willingness to invest in developing the market
For some markets, we have also adapted the products, either to provide slightly cheaper versions or to incorporate additional benefits. This usually was done as a second step, in cooperation with the local distributor.
What is the importance of Swissness for Microlife AG in export?
Swissness is important, but it is not everything. For me, the greatest advantage is the high degree of trust in Swiss companies and Swiss products. So Swissness is a great door opener. However, you should be aware that “Made in Germany” also has an excellent reputation in Eastern Europe. As everywhere in the world, the following factors are crucial: mix of price and performance, innovation, reliability, and flexibility.
What are your recommendations for other Swiss SMEs entering the Eastern European MedTech market? What must they consider?
As a Swiss company, you have a big advantage. You will benefit from a high degree of trust. This asset should be utilized. Because of the distance, in-person meetings with the partner are always a special occasion for the local distributor. The decision-maker at local distributors is usually the owner. For this reason, in-person meetings do not usually take place until everything has been finalized, and the Swiss partner is also expected to have everything finalized. Thorough preparation is therefore very important, and you should know your own limitations. Just say yes or no.
Regular visits to Eastern European countries are highly appreciated by customers as they confirm your interest in their markets.
Distributor events in Switzerland or elsewhere in Europe are very popular with customers and highly conducive to developing a spirit of group dynamics. Customers tend to have a very high level of hospitality too, and tend to be very friendly. I advise everyone to spend time with the customers after the meeting, for example by having dinner together. The conversations are always very interesting.
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Tomorrow's markets - Eastern Europe
Eastern Europe is investing hundreds of millions of Euro in the modernization of ist hospital infrastructure. Swiss SMEs are seizing the opportunity and develop new business. Which markets offer the biggest potentials? What are the challenges? How to proceed when entering These promising markets? In this Breakout Session S-GE will provide answers to those questions. In addition, a Swiss SME active in Eastern Europe will share their experience with you. Find out more and register.
Would you like to know more about your opportunities in Eastern Europe?
Register for a free country consultation at S-GE: Country Consulting Poland
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About Werner Barmettler
Werner Barmettler has been working for Microlife AG since 2008. As Sales Director, he is responsible for OEM customers in Western Europe and for the Microlife Brand business in the Region East. He was born in 1964, is married and has two sons. He has been a member of the community council of the Widnau municipality since 2009.
About Microlife AG
Microlife is a manufacturer of blood pressure monitors, fever thermometers, and electric blankets. The devices are sold in two ways: by marketing them under the Microlife brand, and by manufacturing them on a private label basis. In Eastern Europe, large quantities of inhalers are marketed as commercial products.
At two company-owned factories in Shenzhen, the devices are produced by about 3300 employees. Close cooperation between the quality and regulatory departments in Widnau and Shenzhen ensures that all devices satisfy the highest customer and quality requirements. We are regularly audited by organizations such as TÜV, DEKRA, and KEMA. We are also able to register most devices in line with the strict FDA regulations for the US market. Microlife’s location in Widnau is extremely important for the Microlife Group in maintaining such high standards. Microlife is viewed as a Swiss brand throughout the EMEA region.
Microlife is now a stock exchange listed company, with the majority of the shares being held by the founder K.Y. Lin .