Group Purchasing Organizations in the US - Industry Market Research Report

Group Purchasing Organizations in the US - Industry Market Research Report

Group Purchasing Organizations in the US

The Group Purchasing Organizations (GPOs) industry is composed of entities that leverage the purchasing power of groups of businesses to obtain collective discounts from vendors. GPOs earn most of their revenue by charging an administrative fee to vendors. For the past five years, demand for GPO services increased as the improving economy stimulated demand for various downstream industries, including the manufacturing and food service sectors. Meanwhile, rising access to health insurance drove demand from healthcare providers. The healthcare sector is by far the largest market for the industry, accounting for more than 60.0% of industry revenue. According to the Healthcare Supply Chain Association, a trade association representing the largest healthcare GPOs in the United States, more than 95.0% of all hospitals hold at least one GPO membership, and about 72.0% of all purchases that hospitals make are done using GPO contracts. Consequently, demand for medical services strongly affects demand for GPO services. As a result, over the past five years, industry revenue has been growing at an annualized 2.2%, and is expected to reach $6.3 billion in 2023. Despite this growth, profit has slightly declined because GPOs are limited in their ability to raise prices.

This industry includes organizations that leverage the purchasing power of groups of businesses to obtain collective discounts from vendors.

This report covers the scope, size, disposition and growth of the industry including the key sensitivities and success factors. Also included are five year industry forecasts, growth rates and an analysis of the industry key players and their market shares."