Plastic Syringe Component Manufacturing In Kuwait Business Plans Examples

Published: 2021-06-21 23:42:02
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Syringes are the familiar glass or plastic items nurses use to inject vaccinations or medicines. Plastic disposable syringes represent a huge and growing market, projected as $12 billion worldwide in 2015 (GIA, 2008). First used in 1853, syringes might be considered a mundane, mature product. However, the syringe market is undergoing a disruptive change, which gives opportunities for new market entrants (Wood, 2013). A disruptive change is a technology or behavior change that totally upends the traditional market. For example, digital photography virtually eliminated the old film photographs. Great film companies like Kodak failed (Disalvo, 2011). New electronics companies like Panasonic grew rapidly./>
Because of infection concerns, especially with HIV/AIDS, the old reusable glass syringe is rapidly being phased out worldwide, in favor of one-time plastic disposable syringes. Within the disposable syringe market, there are new trends. First, there is the “safety syringe”, which prevents nurses accidently sticking themselves with the needle. Second, the personal home injection market is rapidly growing for people with chronic diseases like diabetes. Third, there is a movement to one-time pre-filled syringes, where the drug is already in the syringe (Wood, 2013).
The increasing wealth and aging of populations, even in developing countries, has produced an increase in both chronic diseases and the ability of patients to pay for ongoing medical treatment (WHO, n.d.). For the syringe market, chronic diseases is the growth area as people may need multiple syringes every week for many years.
Syringes are relatively high-value, low-weight items. Though Kuwait has a small home market, high-value low-weight items may be effectively shipped worldwide (Fedex, 2006). Plastic syringes may be made with expensively automated machines (King Machine, 2014). Kuwait has considerable capital, but expensive labor and other costs. Therefore, heavily automated processes are attractive for a Kuwaiti company. Plastic syringes are made from polyethylene. The raw materials to make polyethylene are a by-product of petroleum extraction – Kuwait’s major industry. Kuwait now has a large polyethylene production capacity (Dow, 2014). However, polyethylene is a heavy, low-value, commodity product. Hence the polyethylene raw material is available at very low cost to local Kuwaiti companies. It would be attractive for Kuwaiti companies to convert raw polyethylene into higher value complex finished products.
Kuwait has a good reputation for being a well-organized industrial country capable of high quality. This reputation is anchored by the clean, attractive chain of Q8 roadside service stations in Europe and the North America (Q8.com, 2014). Thus, apart from well capitalized operations and low cost raw materials, Kuwait has a quality perception advantage over competitors like Bangladesh. The intent is to start with basic components, using only plastic-processing. The components would be shipped to pharmaceutical companies for insertion of the cannula (needle), finishing, branding, and distribution. In the future, Kuwait has excellent opportunities to move up the value chain. First, Kuwait could make finished products, including the cannula. Second, Kuwait should establish a branding and marketing strategy. Third, Kuwait should start making “safety syringes” and pre-filled syringes. The potential market for pre-filled syringes is very strong as healthcare providers have found that these syringes reduce expensive drug wastage and improve patient dosing and compliance.
Overall, plastic syringe manufacturing ideally fits Kuwait. Syringes are a reasonably high-value product, with low shipping weight. The market is increasing as there are more and more people worldwide with chronic disease. Technology changes are opening the market to new entrants. Kuwait has low cost raw materials and capital to buy expensive automated manufacturing equipment. With a reputation for quality, syringes give Kuwait a potential to move up the value chain, to more complex, higher margin products. The manufacturing of plastic syringes offers Kuwait one path for transitioning to a more diversified economy, with less dependence on unrefined petroleum exports.
References:
Global Industry Analysts, Inc. (2008, Nov. 11), Syringes Market to Reach $12.1 Billion by 2015. PRWEB. Retrieved from: http://www.prweb.com/releases/syringes_hypodermic/intraligamentary_insulin/prweb1595174.htm
Wood, C. (2013, July 11), Reinventing the Hypodermic Syringe: A Market Ripe for Disruption. The Technology Investor. Retrieved from:
https://www.caseyresearch.com/cdd/reinventing-the-hypodermic-syringe-a-market-ripe-for-disruption
David DiSalvo, D. (2011, Oct. 11), The Fall of Kodak: A Tale of Disruptive Technology and Bad Business. Forbes Magazine. Retrieved from: http://www.forbes.com/sites/daviddisalvo/2011/10/02/what-i-saw-as-kodak-crumbled/
WHO (n.d.). The Global Burden of Chronic Disease. World Health Organization Official Website. Retrieved from: http://www.who.int/nutrition/topics/2_background/en/
Fedex Corporation. (2006). USA Securities and Exchange Commission 10-K Report.
Retrieved from:
http://www.wikinvest.com/stock/FedEx_(FDX)/Filing/10-K/2006/F1241539
King Machine Corporation, (2014). Syringe Injection Molding Machine. Retrieved from: http://king-machine.en.alibaba.com/product/477992043-209642572/Syringe_Injection_Molding_Machine.html
DOW.com (2014) Dow in Kuwait – EQUATE Petrochemical Company. Official Company Website. Retrieved from: http://www.dow.com/middleeast/about/kuwait.htm
Q8.com. (2014). Service Stations. Official Company Website. Retrieved from: http://www.q8.com/content/products-services/Pages/service-stations.aspx

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