China LASIK Forcast 2013 - 2023

Forecast of Laser Refract ive Surgery in China: 2013 -2023

The Growth of Consumer Credit

One area for potential growth in the LASIK market is supported by a trend amongst Chinese consumers around consumer credit. Consumer credit dependence is growing at impressive rates, and is increasing in spite of traditional Confucian beliefs which look negatively on borrowing money – especially borrowing beyond one’s means.

Credit cards were introduced in China in 1985, and while they had slow growth at first, the behavior has changed in recent years. In 2011, purchases combined to over one trillion U.S. dollars in China, in a country that historically used cash for transactions. According to RNCOS xx , an industry researcher, credit card purchases in China will continue to grow at a rate of over 30% per year for the next five years. In addition, MasterCard projects that by the year 2020, China will be the largest credit card market in the world. The United States is expected to be second. The growth of consumer credit use represents a cultural adjustment in Chinese traditional values and is particularly seen in urban young adults and professionals under 35 who live in first and second tier cities. The change can be attributed to aggressive marketing by financial institutions and a status-driven culture. Growth of consumer credit facilities could create a market where laser refractive surgery can be financed with the swipe of a credit card.

AS CHINA’S MARKET MATURES AND MORE PEOPLE HAVE DIRECT EXPERIENCE WITH

REFRACTIVE SURGERY, EITHER PERSONALLY OR THROUGH FRIENDS, FAMILY AND CO-WORKERS, THE IMPACT OF NEGATIVE MEDIA REPORTS CAN BE EXPECTED TO DIMINISH .

Capi tal Equipment Acqui sit ion and

Technology Cycles

Laser refractive surgery is capital equipment intensive. A laser suite costs approximately USD $1 million and equipment prices are similar in China to the rest of the world. Equipment leasing is uncommon in China and the high cost to purchase the capital equipment needed to equip a laser suite presents a significant barrier to the development of new centers.

One laser suite can accommodate a high capacity of patients. Run efficiently, one suite using modern technology could handle over 100 patients per day. In general it is patient demand, not capacity, that limits center operations.

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