How to Start a Surgical Instruments Business in Pakistan

How to Start a Surgical Instruments Business in Pakistan?

Here is the step by step guide to starting a surgical instruments business in Pakistan:

1. Understand the Market

Before you start setting up your business, it’s important to understand the market in Pakistan. There’s a growing need for surgical instruments because the healthcare industry is getting bigger. Here’s how you can get started:

1. Conduct Research: Find out which surgical instruments are in demand and check out what other companies are already selling.
2. Decide Target Market: Think about whether you want to sell your products just in Pakistan or if you want to sell them to other countries, too, since Pakistan is known for exporting surgical instruments.
3. Identify Distribution Channels: Consider working with hospitals, clinics, and distributors to get your products into the hands of more people.

By doing this, you can make sure you are ready to meet the growing demand and stand out in the market.

2. Develop a Business Plan

Creating a solid business plan is really important for your factory. It will help you stay focused and organized. Here’s what you should include in your plan:

1. Business Objectives and Goals: Consider what you want to accomplish now and in the future. For example, do you want to make your factory big or focus on a specific type of instrument?
2. Target Market and Competitive Analysis: Know who your customers are. Will you sell to hospitals and clinics in Pakistan or also to other countries? Also, look at what other companies are doing to see how you can be different.
3. Financial Projections: Think about how much money you need to start and how much you hope to earn. This includes things like how much your factory will cost to run and how much you plan to make in the first few years.
4. Marketing Strategy: Think of ways to let people know about your surgical instruments. Will you use social media, ads, or other methods?
5. Product Specifications: Decide what kinds of tools you want to produce, like scalpels, forceps, or scissors. You should also think about what makes your products special, like better quality or unique features.

With a good plan, you will know what steps to take and be ready for success!

3. Deciding on Product Classification and Range

When starting a surgical instrument factory, choosing the right product range is crucial. You can manufacture instruments tailored to specific branches of surgery. Here’s a list of common product classifications you can consider:

4. Register Your Company

First, register your business with the Securities and Exchange Commission of Pakistan (SECP). This step makes your business official and gives it legal recognition.

Once registered, apply for an establishment license to sell medical equipment from the relevant authority. A professional consultant from WaysTax can help you to easily register your company.

Types of Licenses for Surgical Instrument Manufacturing and Export in Pakistan

For legal compliance and competitive advantage, here are some licenses and certifications needed:

• Drug Manufacturing License: Issued by DRAP, this ensures adherence to safety and health standards.
• ISO Certification: Although not mandatory, ISO certification can improve reputation and credibility in export markets.
• Export License: Required to export surgical instruments and establish legal authority to operate in global markets. ( if you are thinking of exporting)
• Import-Export License: If your business involves both manufacturing and exporting surgical instruments, you’ll need an import-export license. It helps you to bring in raw materials and parts for production, as well as ship out the finished instruments to other countries.
• GMP Certification: This certificate is good for surgical instrument manufacturers. It ensures that your company follows strict quality control measures and production processes, ensuring the highest standards of safety and product quality.
• Trademark Registration: While it is not a licensing requirement, but is important for manufacturers and exporters of surgical instruments. It protects your brand name and logo, so no one can use them without your permission.

5. Engagement with the Drug Regulatory Authority

After registration, contact the Drug Regulatory Authority of Pakistan (DRAP). They oversee compliance and quality control, which is essential in this highly regulated industry.

6. Choose the Right Location

If you want to be a manufacturer, location matters a lot for smooth running:

• Find industrial areas with good infrastructure, transport, and skilled labor.
• Consider expenses for land, utilities, and other costs.
• Pick a spot near raw material suppliers to lower transport costs and keep a steady flow of materials.

7. Procure Machinery and Equipment

High-quality machines are important for making surgical instruments:

• Find reliable suppliers for tools like precision cutters, sterilizers, and quality control machines.
• Make sure you have enough money to buy good equipment that meets global standards.
• Plan for regular maintenance to keep the machines working well.

8. Secure Funding and Financial Planning

Good financing is key to starting and running your business:

• Calculate startup costs like equipment, location, salaries, and other initial expenses.
• Look for funding options like government grants, loans, or investors in the medical field.
• Create a plan to track expenses, manage money, and set aside a budget for emergencies.

9. Hire Skilled Labor and Build a Team

To make sure your instruments are high quality, you need skilled workers:

• Hire experienced technicians and engineers for manufacturing.
• Offer training programs to keep your team updated on the latest methods.
• Set up a quality control team to check and ensure products meet safety standards.

10. Set Up Production Processes

To make production efficient and profitable:

1. Design a Workflow: Plan the steps from receiving materials to packaging the final product.
2. Set Up Assembly Lines: Create specific lines for different instruments to speed up production.
3. Use Inventory Management: Keep track of materials and finished products with an inventory system.

11. Ensure Stringent Quality Control

Quality control is very important in making surgical instruments to avoid health risks and legal problems:

1. Create Quality Control Procedures: Set up strict checks at different stages of production.
2. Use Testing Equipment: Invest in tools to measure precision and test durability.
3. Get ISO Certifications: Certifications like ISO 13485 and ISO 9001 boost your factory’s reputation and help sell products globally.

12. Source and Manage Raw Materials

Reliable raw materials are key to making high-quality surgical instruments:

1. Find Trusted Suppliers: Choose suppliers who provide high-quality metals and materials that meet medical standards.
2. Negotiate Contracts: Make long-term agreements to lock in material prices and ensure timely delivery.
3. Test Materials: Test incoming materials to ensure they meet regulatory standards.

13. Marketing and Sales Strategy

A strong marketing strategy will help you stand out in a competitive market:

1. Build a Brand Identity: Create a brand that represents quality, reliability, and precision.
2. Use Digital Marketing: Promote your products online, especially if targeting international markets.
3. Attend Trade Shows: Network and find new clients at industry events.
4. Form Partnerships: Work with hospitals, clinics, and healthcare distributors to boost sales.

14. Export and Expand Internationally

Pakistan is famous for exporting high-quality surgical instruments, so it’s a good idea to expand your market:

1. Meet Global Standards: Ensure your products meet international regulations to enter foreign markets easily.
2. Target Growing Markets: Focus on regions with increasing healthcare needs, such as the Middle East, Africa, and Europe.
3. Connect with Export Authorities: Work with organizations like Pakistan’s Trade Development Authority to understand export processes and requirements.

Packaging Requirements for Surgical Instruments

Proper packaging is critical for maintaining the quality and sterility of surgical instruments. Follow these 5 steps to ensure your products reach international or local buyers in good condition:

Step 1: Cleaning and Sterilizing

All tools must be cleaned and sterilized well to follow health standards.

Step 2: Wrapping Each

Wrap each tool in sterilized plastic to avoid contamination.

Step 3: Inner Box

Put the wrapped tools in a strong inner box with materials like bubble wrap for safety.

Step 4: Outer Box

Put the inner box into a strong outer box with padding to stop damage during shipping.

Step 5: Sealing and Tags

Seal the box tightly with durable tape and tag it with the correct shipping instructions.

Key Documentation for Exporting Surgical Instruments

Exporting surgical instruments needs careful papers to follow global rules. Here are the key documents.

• Air Waybill: Contains shipping and receiving addresses, product details, Harmonized System (HS) codes, and packaging information.
• Customs Invoice: Details the transaction, including product costs, identification numbers, Incoterms, and reason for export.
• Proof of Origin: Verifies that the instruments are manufactured in Pakistan, which may be required by some importing countries.
• Export Permit: Obtain an export permit from the Medical Device Board (MDB), which is mandatory for surgical instruments.
• Testing Certificates: Quality assurance certificates from the Sialkot Material Testing Laboratory are often required to meet international standards.

Additional Documents Requirements for Specific Countries

Some importing countries, like the United States and European Union (EU), have their own additional requirements:

• FDA Clearance (USA): Mandatory for imports to the U.S., certifying the safety and intended use of medical devices.
• CE Marking (EU): Instruments must comply with the Medical Devices Directive 93/42/EEC to enter EU markets. The labeling should include the trade name and address of the manufacturer.

Understand Duties and Taxes

In Pakistan, a 17% sales tax generally applies to exports, with an additional 1% tax for non-registered customers. However, Pakistan’s Free Trade Agreements (FTAs) can provide tariff reductions for specific countries.

Example: Under the China-Pakistan FTA, surgical instrument tariffs are between 4-8%, a reduction from the standard 13%.

HS Code for Surgical Instruments

Most surgical instruments fall under HS code 9018, with each country applying its own duties based on this classification. For instance, the U.S. often has a 0% duty for products under this code.

Industry Overview and Market Potential

Pakistan is a recognized exporter of high-quality surgical instruments, especially in Class I and certain Class IIb categories. The industry has over 360 companies and employs around 150,000 skilled workers, primarily concentrated in Sialkot, Punjab.

The country has maintained a stable 0.7% share of the global market, with leading importers like Germany, the UK, and the USA. But, because of strong dependence on some markets, there is a chance for growth by expanding into new areas.

Challenges in Pakistan’s Surgical Instruments Industry

Even though the surgical instrument industry of Pakistan is known for quality, it faces some challenges that slow its growth:

1. Strong Local Competition: Many manufacturers focus on low prices, which can reduce profits.
2. No Branding: A lot of products are exported without the “Made in Pakistan” label, missing out on branding opportunities.
3. Market Barriers: Established supply chains make it hard to enter some markets directly.
4. New EU Rules: New regulations for medical devices in the EU create extra costs and challenges for exports.

Strategic Recommendations for Pakistan’s Surgical Instruments Business Growth

To tackle challenges and increase Pakistan’s global market presence, here are some ideas to think about:

1. Joint Ventures (JVs): Collaborate with firms from Germany or China to increase production and improve market access.
2. Government Aid for Compliance: The government can hire international consultants to assist manufacturers in meeting regulations.
3. Quality Control & Self-Regulation: Create a main warehouse for raw materials and follow SIMAP-approved certification standards for consistency.
4. Brand Development with ‘PAKQUALITY’: Like Turkey’s TURQUALITY, Pakistan could launch a program to promote its high-quality surgical tools globally.
5. Innovative Packaging: Provide product kits or bundles similar to what is seen in Chinese markets to appeal to more buyers.
6. Selective Export Pricing: Change prices for disposable instruments to stay competitive globally.
7. Market Diversification: Move into new areas such as East Africa, South Africa, Canada, and ASEAN countries to lessen reliance on traditional markets.
8. E-commerce Utilization: Use platforms like Alibaba and Amazon for new sales channels and to decrease dependency on trade shows.
9. Easier Documentation:  Streamline export documents to boost Pakistan’s market position globally.

Export Data Overview of Surgical Instruments | Global Vs. Pakistan

The following table provides a snapshot of Pakistan’s export performance in the global surgical instruments market:

Wrapping Up

This guide on “how to start a surgical instrument business in Pakistan “ has covered all the important information for you. This sector in Pakistan has a strong base and a capable workforce, which supports potential growth. 

Keep your focus on investments in quality control, branding, and expanding market reach to take advantage of worldwide chances.

Through collaborations, improving compliance assistance, and intending for new markets, you can boost your presence in the global surgical instruments sector and achieve lasting success.