Market manipulation
Wednesday, 3 December 2008
Last Updated: Tuesday, 2 December 2008
By Robert Bryant
The ageing population and increasing government health spending are helping the physiotherapy sector record strong growth, although the weakening economic environment may force some operators to book in for a stress-relieving massage.
Physiotherapists are at full stretch as demand for services increases thanks to an ageing population and expanded government spending. IBISWorld estimates that industry revenue will grow at an average annual rate of 5.1% over the five years to 2008-09.
An increasing proportion of the population with private health insurance is also seeing more people seek physiotherapy, while safer workplaces (with fewer workplace accidents) has led to a reduction in WorkCover payments for physiotherapy.
The main hindrance to further industry growth appears to be labour shortages, as overall demand outstrips capacity. Although the number of physiotherapists as a proportion of the population has risen over the last five years, it is believed many of these are part-time practitioners.
The continued health of the industry seems assured, as demand from a rapidly ageing population increases (particularly in the group aged 65 and above) and government health care assistance programs continue to attach more importance to physiotherapy services. IBISWorld forecasts that industry revenue will grow at an average annual rate of 3.8% over the five years to 2013-14.
But there are some dark clouds on the horizon. A decline in the proportion of the population with private health cover, and weaker household disposable income growth, may dampen demand for physiotherapy services and put pressure on prices over the outlook period.
On top of this, labour shortages will continue to be an issue and the Australian Physiotherapy Association contends there is a need for more funded postgraduate positions in specialist areas such as cardiothoracic, pediatrics, gerontological, musculoskeletal, and neurological physiotherapy.
Key success factors for operators in the industry
- Access to niche markets. Establishing a reputation as a specialist service.
- Having a good reputation. Establishing a reputation for consistent and sound results. A successful practitioner needs to establish their reputation in both medical and community spheres.
- Having a loyal customer base. Establishing rapport with patients to gain loyalty and referrals.
- Proximity to key markets. Location of the practice to maximise visibility and accessibility.
- Membership of an industry organisation. Membership of the Australian Physiotherapy Association can bolster credibility and can provide access to services, such as accreditation.
- Must have licence. Physiotherapists must be registered.
- Having a wide and expanding product range. Provision of a wide range of services. Some firms may provide services in a larger multidisciplinary practice.
- Ensuring pricing policy is appropriate. Setting fees at a level which maximises profitability while remaining attractive to potential customers.
Industry segmentation
Major market segments
IBISWorld supplies business information databases, including industry reports, company reports and business indicator reports. www.ibisworld.com.au
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