由 Kathy Mahdoubi
, Senior Correspondent | March 11, 2010
This report originally appeared in the February 2010 issue of DOTmed Business News
Economic stress may be creating deep furrows on the brows of Americans, but more seem to be focusing on cash flow, rather than wrinkles when it comes to setting priorities and are opting out of cosmetic procedures that used to have them beating down the doors of the nation's medi-spas. While many industries have recently fallen on hard times, the cosmetic laser industry in particular has not been able to outshine consumer hesitancy, equipment financing woes and medi-spa budget cuts. Family practices are also taking a good look at their patient population to determine what procedures would best improve their bottom-line, and technology like intense pulsed light (IPL) systems are moving in on laser territory. Still, some are managing well and taking advantage of the potential upside of a down economy, like rock-bottom prices and opportunities for manufacturers to merge and consolidate.
Zapped by the economy
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Fabian Tenenbaum, CFO of major laser manufacturer Syneron, estimates that there has been a 20 to 30 percent drop in new laser sales from the peak of 2007 to the third quarter of 2009.
"It was a challenging time in this space, with sales mostly declining year over year," says Tenenbaum. "We've seen some of the strongholds of the cosmetic market hold up pretty well, especially what we call the core markets - the dermatology and plastic surgery markets. Some markets were hit harder, mainly new entrants into the aesthetic provider market. This is especially true for the more developed markets like the U.S. that have been experiencing macroeconomic challenges that have affected consumer confidence and spending."
From the physician's perspective
Jeff Russell, executive director of the International Association for Physicians in Aesthetic Medicine (IAPAM), just published a paper on the latest trends in the industry.
"Right now there is a consolidation in the laser industry," says Russell. "There is a lot of merging of the larger laser companies and shutting down of smaller ones. It will be interesting to see what happens in the future. Whenever we are looking at laser manufacturers now, we are looking at their financial statements to make sure they are still going to be in business in a year or two. That's an important thing we never used to do, but now we give our members a financial snapshot of those companies."
For new purchases, the IAPAM now generally only recommends buying from the top five manufacturers, and even some of those have weak balance sheets.