Amazon is trying hard to become the go-to source for basic medical supplies and create a marketplace for hospitals to shop for supplies for emergency rooms, operating suites and outpatient facilities. The focus ranges from everything used in doctors’ offices to ambulatory surgery centers - latex gloves, bandages and sutures.

It is easy for big hospitals to buy medical practices to cater to ever-growing outpatient-care market. However, the distribution systems find it difficult to keep up. Amazon provides an easy and convenient platform for this underserved market. With speedy shipping, Amazon could emerge as a dominant player if it can provide the supplies efficiently. Moreover, with improved understanding of the healthcare industry, amazon could also target selling expensive drugs and high-tech medical devices.

The fragmented nature of the health business makes it especially attractive. Even though the ownership is all over the place, all the businesses need many of the same supplies. This might further help Amazon in striking a deal with the industry to cut the middlemen and share the savings. Amazon would have to develop its modus operandi of dealing with medical market. Amazon would have to deal with a network of standardized vendors to gain hospitals’ confidence (about the version of a product received) for every order placed. Also, most medical supplies are purchased on a contract basis – at a fixed price. Adjusting to an on-demand pricing might also be a task for hospitals.

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