Medical firms don't always knock at the door of Japanese hospitals

March 2, 1994

Administrators need more informationThe Clinton Administration is threatening punitive measures unlessJapan opens its markets to American products. But American companiesmay be partly to blame for poor sales of medical imaging

Administrators need more information

The Clinton Administration is threatening punitive measures unlessJapan opens its markets to American products. But American companiesmay be partly to blame for poor sales of medical imaging equipment,according to one American who serves as chief operating officerof the Kameda Medical Center in Kamogawa City, Japan.

"Hospital administrators, who are usually physicians inJapan, do not know much about American equipment. I do not seethe company representatives being very aggressive in the market,"said Wocher, a native of Iowa.

Wocher serves as chairman of the Kameda Medical Center equipmentpurchasing committee, which makes purchasing recommendations tothe hospital board. As the only American administrator of a Japanesehospital, he provides a unique perspective about the way medicalproduct decisions are made in Japan.

The belief that the Japanese government sets the tone for medicalequipment purchases is wrong, Wocher said.

"Japanese hospitals, in my opinion, do not think globallyand, therefore, do not know what the government trade policy isor how it affects buying decisions," he said.

The real problem may be that most American companies lack thesavvy to compete in Japanese markets, he said. Even the basicsof marketing are absent.

"I have yet to receive any promotional material from U.S.manufacturers," Wocher said.

The product access that most administrators in the U.S. considerindispensable for making purchase decisions is generally not providedby American companies in Japan, he said.

"If I knew where to go to see a product demonstrationhere in Japan of a major piece of equipment, to see whether Iliked it and to ask questions about it, that could be an advantage,"Wocher said.

The Japanese language appears to be a barrier for Americancompanies, he said.

"The (equipment) manuals provided by Japanese manufacturersare in Japanese; the ones from American companies are not,"he said. The same is true for product advertising. "A bilingualproduct information package might go a long way in just piquinginterest," he said.

The time to overcome these shortcomings is now, according toWocher. Price has become very important in Japan and is the maindeterminant for hospitals with limited budgets, particularly thesmall ones, he said.

With the weak dollar and strong yen, American companies havea price edge, he said. Even Kameda Medical Center, which has 760beds, is looking to buy equipment from the U.S.

because of the favorable exchange rate between dollars andyen. Price, however, is only one of several factors consideredby administrators at Kameda Medical Center. Quality and servicemust also be assured. If all three are relatively equal, the presenceof an existing relationship with a vendor becomes the decidingfactor, Wocher said.

That is, in fact, where Japanese companies have an edge. Wocher,like his colleagues in other Japanese hospitals, wants a senseof partnership with imaging vendors.

"Strangers come and go," he said. But companies thathave a reputation for quality, both in products and service, attractsales.

"If the company is not well established and does not havean existing reputation for excellence in service, we all tendto avoid serious consideration," Wocher said.