Threat of Tenant - LOW

• Before becoming a licensed medical professional (which is required to work

in a hospital), a long journey of studying is required.
• All Filipino medical professionals are required to submit Continuing
Professional Development (CPD) in renewing licenses.
• High amount of capital is a requirement for constructing a hospital.
• There are a lot of licensing and permit requirements by the government
before a hospital can be build.
• With the pandemic, some private hospitals are force to close and some on
the verge of closing if they are forced to give hazard pay due to high
amount of expenses for covid facilities and other financial difficulties which
can be a bad news to new aspiring tenants in the market.

Power of Supplier - HIGH Competitive Rivalry - LOW Power of Buyer – LOW

• Bargaining power of healthcare professionals are high since they are ones
who performs the services offered by the hospitals.
• If a doctor or a physician has a good reputation, wherever he or she goes,
customers are almost a guarantee to follow. Some even go to urban
hospitals to follow their doctors or for a better quality of service even if
there is an available equivalent of service in the province.
• The ratio between medical professionals and population is significantly
different. As for April 2020, there are 10 doctors for every 10,000 Filipinos
in the NCR.
• For equipment that is required for different operations or service, there is
a low bargaining power since there is a lot of substitutes that offers such
equipment internationally.
• In general, the bargaining power of suppliers are high since medical
professionals are considered the suppliers of patient.
• There is fewer hospital in remote areas than those in urban areas or cities.
• Hospitals in the cities are much more capable than hospitals in the rural
areas. This situation can be seen when a patient needs a major operation or
needs a doctor for a specific illness which are not present in rural hospitals.
• Rural or small hospitals can only offer basic services while established
hospitals are
• Difference between capability and services offered by high tier hospitals
(St. Luke’s, DLSUMC, etc.) are the main reason for a low competitive rivalry
which gives them the ability to charge higher compared to those small
hospitals.
• The main reason for the capability and services offered is because private
hospitals are loaded with funds compared to those rural hospitals which
are usually funded by the government (public hospitals).
• The ratio between the hospital beds is 13.5 per 10,000 population (NCR).
• Considering the ratio, most of the hospitals are max population that it
cannot accommodate more patients.
• With the pandemic, customers have a low power or has no power to
demand or choose as most if not all hospitals cannot accommodate
patients anymore.
• Patients has little if no power to bargain since their decision is mostly
based on the advice or diagnosis of doctors.
• The significant difference between the ratio of the hospitals to the
population is a major problem in our healthcare industry and is the main
reason why the bargaining power of the buyers is low.

Threat of Substitute - LOW

• In general, threat of substitute is low in the hospital industry.
• Albularyos is one of the substitutes of Filipinos to healthcare, the reason
why Filipinos still believe to such magical healing is mainly rooted to our
culture.
• Science of healthcare is much more safe, logical, and effective rather than
opting for albularyos.
• For complicated operation there is no substitute. For example, an
operation for the heart (bypass, angioplasty, etc.).
• The only possible to have a substitute in the hospital industry is their
medicine. For example, CATA flam (branded) has a generic (rite med)
counterpart (Diclofenac) which has a significant price difference.
References:

Reyes-Habito, C. (.N.D). The CPD Law: A Commitment to Life Long Learning for Medical Professionals. Retrieved 28 September 2021, from https://journal.pds.org.ph/the-cpd-law-a-commitment-to-life-long-learning-for-medical-professionals/

Luis, P. (2018). Planning and designing ph hospitals the right way. Retrieved 28 September 2021, from https://www.manilatimes.net/2018/08/22/business/real-estate-and-property/planning-and-designing-ph-hospitals-the-right-way/432936

CNN Philippines Staff. (2020). Private hospitals could close down if forced to grant benefits to frontliners. Retrieved 28 September 2021, from https://cnnphilippines.com/news/2020/7/15/COVID-frontliners-benefits-private-hospitals-could-close-
down.html?fbclid=IwAR1_CSPLD-jdEd7EkgfMDMcDITyPMEc3ixa1TDIN79x_tEAUBmX7EXlh2xE

Flores, L. (2020). Hospitals in the Philippines: Where they are – and aren’t. Retrieved 28 September 2021, from https://www.rappler.com/newsbreak/in-depth/locations-mapping-hospitals-healthcare-facilities-philippines

Statistica. (2021). Number of hospital beds in the Philippines as of April 2020, by region. Retrieved 29 September 2021, from https://www.statista.com/statistics/1122326/philippines-number-of-hospital-beds-by-region/

Limos, M. (2020). Albularyo: Why 'Magic' Healing Still Prevails in the Philippines. Retrieved 29 September 2021, from https://www.esquiremag.ph/long-reads/features/albularyo-origins-and-practices-philippines-a00293-20200418-lfrm

Alternative to RiteMED Diclofenac in Philippines. (n.d). Retrieved 29 September 2021, from https://pillintrip.com/search_analog_ritemed-diclofenac_in_philippines

Statistica. (2021). Number of doctors in the Philippines as of April 2020, by region. Retrieved 29 September 2021, from https://www.statista.com/statistics/1122063/philippines-number-of-doctors-by-region/

Malabrigo, J. (2015). Strategic Management Paper - Hospital industry analysis. Retrieved 29 September 2021, from https://www.slideshare.net/ironswordlady/hospital-industry-analysis-by-jenny-malabrigo