Background into Industry

Posted: November 8th, 2023

Background into Industry

The canes and crutch market is estimated at 3.2 billion dollars in 2021. Market research shows that the global cane industry will grow by 8.7% annually (Manocha et al. 2021). Also known as mobility assistive devices, canes and crutch help individuals with a disability, injury or illness to walk. The ageing population has a growing tendency to purchase mobility devices to offset diminishing functions. However, investors might be pessimistic concerning the current economic conditions. The coronavirus pandemic might have led to business downtimes, but it has also caused a change in consumer behaviours that benefits the proposed business. The report summarizes current market conditions, highlighting why this is an opportune time to enter the cane and crutch industry.

The Current Market

            The cane and crutch market is growing at an unprecedented rate. According to a 2019 study by Research and Markets, the North American and European canes and crutch market will reach 5.2 billion dollars by 2025 (Manocha et al. 2021). The industry’s impressive growth is associated with an increase in sports and car injuries. The primary reason for market growth is the expanding ageing population. More and more individuals are getting older, making them more prone to falls. The United Nations estimates there will be nearly 2.1 billion individuals above the age of 60 by 2050. The geriatric populace is associated with a 4.3% annual growth rate between 2018-and 2025 (Warees et al. 2021). Even without considering chronic ailments, the cane and crutch market will grow due to the inevitability of diminishing physiological function.

The expanding geriatric population also implies increased hip, knee and joint replacements. A major cause of bone treatments is osteoporosis. The International Osteoporosis Foundation recorded over 200 million individuals suffering from the disease in 2018 (Warees et al. 2021). The incidence rate of the disease increases as people get older. One-tenth of women above sixty experience the illness, while one-fifth of women above seventy have the disorder (Warees et al. 2021). There is also an increasing number of arthritis cases among the elderly. Another underlying business opportunity is the emerging economies. A significant number of individuals from third-world countries are yet to be introduced to technologically advanced assistive devices. Overall, all factors indicate a positive and sustainable market growth rate.

Industry Trends

            North America is the second-largest canes and crutch market after Pacific Asia. In 2018, crutches had the greatest market share. The assistive tool is used to reduce pressure on the injured leg by transferring body weight to the arms. Market research indicates the conventional crutch results in under-arm discomfort and pain, which discourages long term use (Manocha et al. 2021). The proposed crutch seeks to address this market niche. By transferring body weight to the forearm instead of the underarm, there is less pressure put on the leg and lower back. The science behind the product increases its utility among the old and the obese. There are over 70 million obese individuals in America, an astonishing 42.4% of the country’s population (Saunders et al. 2013). The sleek forward design makes it appealing to overweight individuals, who often face social stigma because of using assistive devices. The forearm crutch facilitates long-term use, enabling the user to burn more calories by walking.

Competitive Landscape

            Market analysis indicates the canes and crutch industry experiences medium or moderate levels of competition. Major companies include Medical Deport, Nova, GF Health Products and Cardinal Health. Internal financial statements highlight that competition does not significantly impact marketing functions, including product pricing. The business needs to sell 380 crutches monthly to break even. Financial projections indicate the business can sell 2000 crutches a month. Therefore, expected sales should be sufficient to offset the breakeven analysis. Despite the presence of key players, financial data indicate the business will reach profitability after one year of operations.

Barriers to Market Entry

            Logistics is the main problem for a small-medium holder firm like ours. The business depends on e-commerce to reach and engage a wide range of consumers. However, e-consumers expect timely delivery of high-quality products. The business will need to identify an external distribution channel, mainly a logistics firm, to carry out the warehouse to consumer product transportation. Outsourcing transport implies increased operational costs until when the organization establishes its own distribution channel. The business will have to adopt a conservative cash flow balance, ensuring the availability of an active line of credit to meet any unexpected challenges associated with logistics.

Conclusion

The expansion of the geriatric population and the increase in musculoskeletal disorders, osteoporosis and arthritis, will fuel the growth of the global canes and crutch industry. There is also a surge in obese individuals and rehabilitative patients due to substance and alcohol addiction. Market analysis and internal financial analysis both indicate it is a suitable time to venture into the crutch business. Unlike the conventional underarm crutch, the proposed forearm crutch covers a market niche of potential consumers in need of long-term mobility. The business anticipates projected sales will match the breakeven analysis within the first year. The enterprise should reach profitability by the start of the first quarter of the second year of operations. What is required is finding a long-term solution to the logistic problem.

References

Manocha, R., MacGillivray, M. K., Eshraghi, M., & Sawatzky, B. J. (2021). Injuries associated with crutch use: A narrative review. PM & R: The Journal of Injury, Function, And Rehabilitation, 13(10), 1176–1192. https://doi.org/10.1002/pmrj.12514

Saunders, L. L., Krause, J. S., DiPiro, N. D., Kraft, S., & Brotherton, S. (2013). Ambulation and complications related to assistive devices after spinal cord injury. The Journal of Spinal Cord Medicine, 36(6), 652–659. https://doi.org/10.1179/2045772312Y.0000000082

Warees, M., Clayton, L. & Slane, M. (2021). Crutches. StatPearls Publishing.