In the early spring of 2007, Zhangjiang Hi-Tech Park in Pudong, Shanghai, in the park's landmark building Zhangjiang Tower, an office overlooking the park, has just been elevated to Medtronic Greater China President Li Bingrong put down his hands on the regional development strategy report, to the window of the new green look, looking at the distant willows just sprouted, Li Bingrong fell into a deep thought.
It should be said that in less than a year after joining Medtronic, Li and his predecessor, Barry Wilson, senior vice president of international affairs of Medtronic, have brought a lot of changes to the business of the Greater China region: the business sector restructuring has been carried out smoothly; the organizational structure is also basically perfect; the long-term planning of the Chinese market has also begun to be implemented. However, the business in China is still a long way from the expectations of the company's headquarters. Medtronic's international business accounts for about 30% of its global business, while its China business accounts for only 1% of its global business. Optimistic about future market growth, Medtronic plans to capture 5% of its global business in China. That's not unrealistic for Medtronic, which is growing at 40 percent annually. Currently, local medical device manufacturers mainly occupy the low-end market or provide outsourcing services for foreign companies, while the high-end market is almost completely monopolized by foreign companies. At present, the domestic medical equipment market annual sales of 54.8 billion yuan, of which about 10 billion yuan of high-end medical equipment, the growth rate in the past two years have remained at more than 15%.
Local enterprises export a large number of finished products every year, according to a survey, only Shenzhen's annual exports reached 2 billion yuan. But the local enterprises in the service life and product quality and foreign enterprises still have a gap. Multinational enterprises, on the basis of the original high-end sales, hope to take advantage of the local cheap technology and manufacturing power, and rapidly expand the market share in the medical equipment industry. For example, Johnson & Johnson's investment in China will gradually shift from healthcare products to medical devices. It has invested in a new 16,000-square-meter manufacturing facility in Suzhou, with a first-phase investment of US$47 million. The site is expected to expand its product line from orthopedics to the full range of Johnson & Johnson medical devices. Other companies such as Siemens and GE already have one or more manufacturing facilities in China. Medtronic has a pacemaker plant in Zhangjiang, the only pacemaker production line in China.