The market for dental
services in Australia grew steadily during the period FY’2012-FY’2017. Major
drivers of increased patient demand included general improvement in economic
conditions, rising income and job security, incline in private health insurance
funding and overall dental health and treatment awareness among Australian
population. Direct government funding for dental services has been limited
compared to other sectors of healthcare. An increase in the number of
Australian dentistry graduates over the last few years also fueled the market
growth. Rise in number of dentists resulted in increased local competition,
less constrained labor market and better access to dentists. An incline in
dental visit by Australians driven by rise in general awareness for dental
health and prevention and growing unhealthy food habits resulted in increased
market revenues during the last few years.
Majority of the dentists in
Australia operated through standalone clinics, with limited number of organized
dental chains operating in the sector. Individual or out-of-pocket expenditure
on dental services comprised for a large part of revenues for overall Australia
dental services market in FY’2017. Majority of dental establishments in
Australia are privately operated and private health insurance funds only partly
covers for dental care treatment costs. Most dental visits by Australians, post
regular check-up, were for restoration services. The need for restorative
dental treatment has increased due to large number of people willing to retain
their natural teeth and a breakdown of restorations in existing filling and
restorations. Increased spending on aesthetic appearance also aid in market
growth of restorative services.
The Australian market for dental
equipment and supplies is largely import driven with over 90% of the equipments
being imported. Dental equipments were largely imported from Europe, US and
Asia. The United States and Europe have traditionally led the market; however,
products from Asia, especially Japan have become increasingly popular over the
past decade. Domestic production of dental equipments and consumables is very
limited and largely limited to tooth filling materials and dental equipments
such as dentists’ chairs. Small market size of dental equipments has resulted
in companies finding it more cost effective to import goods rather than
manufacture locally.
Victoria and New South Wales are
biggest market both in terms of revenue and supply of doctors, dental clinics. The
dental services market is highly fragmented with majority of providers
operating from small scale single locations, although corporate activity in the
sector is increasing. The market is in mid-late growth stage, recording low
single digit growth year-on-year. However, organized dental clinics have grown
at a health rate in the last decade by expanding their clinics network through
acquisitions or organic growth. The skyrocketing cost of dental services in
Australia has resulted in increased number of citizens considering options
abroad. Former vacations spots in South-East Asia such as Malaysia, Thailand,
Vietnam and Philippines are becoming attractive destinations for vacation
coupled with dental care visits. Australians are looking for affordable options
for rather expensive dental procedures including root canal therapy and
cosmetic dental implants.
Australia’s ageing population,
growing dental health awareness, inclining patient fee for dental services,
rising out-of-pocket and private health insurance expenditure are likely to
drive the market growth in the mid-long term. Growing private health insurance
coverage would largely stimulate market growth going forward as patients would
be willing to visit dental clinics on a more frequently and undergo expensive
procedures as part of it is funded by insurance funds. Growing private health
insurance coverage would largely stimulate market growth going forward as
patients would be willing to visit dental clinics on a more frequently and
undergo expensive procedures as part of it is funded by insurance funds.
Expected rise in number of dental practitioners, dental establishments and
growing per capital expenditure on dental care would positively impact the
market growth.
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