Summary
The $433 million Canadian dental equipment and supplies market is largely satisfied by imports and is estimated to grow 6-8 percent in 2009. The best prospects in the Canadian market are for products designed to meet the demand for cosmetic, aesthetic and restorative dentistry, as well as orthodontic and periodontal care. Demand for innovative and technologically advanced equipment such as laser instruments, computerized systems linked to cameras, and other diagnostic equipment including x-ray machines as well as emerging technologies like digital imaging all represent excellent export prospects for U.S. suppliers of these products.
Opportunities for U.S. exporters within the Canadian market currently have great potential due to the well-recognized quality of U.S. products, the harmonization of product standards and business practices between Canada and the United States, as well as the geographic proximity of the two countries. There are no significant obstacles to entering the Canadian market other than having to comply with regulations that include the licensing of equipment and some products prior to selling. Canadian dentistry associations and schools generally maintain close ties with their U.S. counterparts. Well planned distribution and promotion strategies are key to a successful Canadian market entry and export business development.. The U.S. Commercial Service in Canada can help U.S. dental equipment firms enter this lucrative market through a variety of well adapted and cost-efficient services.
Market Demand
Although Canada is a country well known for its publicly funded universal health care system, what may not be well known is the fact that the Canadian health care system does not include the dental care coverage except under conditions requiring hospitalization as a result of an accident or general illness, which is relatively minimal when considered as a market share.
Canadian dentistry is essentially a private sector market. In fact, less than five percent of all expenditures incurred for professional dental care in Canada were paid by public sources in 2007. This percentage share has decreased over the last decade as public health programs coverage diminished and is not expected to increase in the foreseeable future.
In 2007, Canadians spent over US$10 billion through out of pocket and insurance plans coverage to obtain professional dental care from approximately 45,000 licensed professionals. Of these individuals serving in Canada's dental profession, about half are dentists and the other half are dental hygienists, denturists and dental therapists. These Canadian dental industry worker numbers do not include the approximately 30,000 dental assistants, or the clerical staff employed by dentists and the technicians working in commercial dental laboratories who, fabricate prosthetic devices and appliances.
The dental equipment and supplies market in Canada includes products used by Canadian dental practitioners/surgeons. Consumption of dental equipment and supplies within the public health sector is relatively small, five percent, and occurs primarily within hospital/educational and research environments.
About 50 percent of the demand for dental equipment and supplies in Canada is for products used by dental practitioners and surgeons, who provide professional dental care in the various disciplines of dentistry in Canada. The other half of the demand encompasses the use of disposable and consumable dental supplies such as syringes, needles, cements, composites and alloys.
In the past two decades, Canada's education campaigns have increased the public's awareness of the importance of maintaining proper dental health care. As a result, instead of options requiring "reactive" measures (such as partial or complete dental replacements with prosthetic devices), Canadians have turned instead toward "proactive" preventive measures, thereby increasing the demand for more frequent professional dental care. More than two-thirds of Canadians ages 12 and over visit their dentist once a year or more. A trend toward a higher frequency of visits in the future is confirmed by a higher number of consultations in the 12-19 age group with four in five Canadians visiting regularly (more than once a year) while the 75 years and older age group indicates that less than 50 percent consult with their dentist annually.
The Canadian dental market is steadily evolving and developing, influenced by increasing life expectancies and an improving general state of health. Increased health awareness, among all Canadians, has contributed to the growth of individual demand for quality professional dental care, in all age groups of the population.
As Canada's population ages, the market will experience a significant growth in the demand for treatments and procedures geared toward this segment of the population, including restorative and cosmetic procedures as well as orthodontics and periodontal care. For a majority of Canadians who have benefitted from fluoridated water and overall health care availability for several decades, the younger segments of the Canadian population contribute to an increased demand for care that will help them maintain their dental health and minimize the loss of natural teeth.
Currently, no more than five percent of the cost of professional dental care provided to Canadians is assumed by publicly-funded programs. Individual insurance premiums and employers' programs cover about 65 percent of the cost of dental care. The remaining 30 percent is assumed personally by Canadians, either because they have no dental insurance coverage, or because of deductibles and partial coverage clauses in insurance arrangements. Those in high-income levels and those with higher education levels also have better insurance coverage. When visiting dentists, nine out of ten Canadians are faced with a non-reimbursable out-of-pocket payment portion.
Due to these out-of-pocket expenses for dental care, Canadians are much more discerning when selecting a dentist, and more critical of the care provided, than they are with medical doctors. Since Canada's universal health care system provides full coverage for all citizens concerning medical care other than dental, Canadians are usually not as concerned with the resulting health care expenses, and therefore, tend not to be as critical of, or in selecting, their medical doctors.
Therefore, for these reasons, dentistry in Canada is generally practiced in a fully competitive environment. Dentists must provide the latest available technologies and innovations in order to satisfy and retain their clientele. They must modernize and replace equipment on a regular basis, as well as continually monitor new product techniques and applications.
Furthermore, the ability to integrate computer technology support in dental/clinical instrumentation is currently the object of substantial progress and will continue to constitute a significant single market growth factor in the next three to five years. The desire to adopt these new technologies accelerates the demand/replacement for improved equipment in a number of applications which have already been introduced to the Canadian dental profession. Digital radiology, periodontal devices, mandibular movement analysis, video imaging and clinical patient record systems appear to be the most promising of these already-introduced applications.
The demand for software-based equipment is expected to grow rapidly as more Canadian patients (better informed through the internet), become aware of some of the advantages provided by advanced dental equipment. Canadians increasingly seek dentists incorporating the latest technologies in their practice and expect them to be integrated into their personal dental care. In aesthetic dentistry, for example, patients are increasingly familiar with imaging and other technologies offered in aesthetic care practices. They expect these technologies to be a routine part of dental care procedures.
Digital radiography is prime example of technological improvements that increase the overall market demand for dental equipment and supplies. Through digital radiography, the limited duration of x-ray exams (due to potential contamination), and the time spent to develop conventional film is eliminated. Digital radiography permits the quantification of exams and results, allowing dentists to deliver a more complete diagnosis and clearer interpretation of test results.
By Pierre Richer
