More than 60% of the global dentures are produced in China. After the decline in gross profit, will implants be the next profitable one?

As one of the upstream pillars of the dental industry, the operation mode of denture processing plants has long been not labor intensive. With the broad application of digital devices such as CAM/CAD technology, oral scanning, CBCT, etc., the time of denture production has been dramatically shortened, and denture processing has become technology and capital-intensive industries, and will further develop in the direction of refinement and specialization.

China's denture processing industry is concentrated in the Pearl River Delta region centered on Shenzhen and the Yangtze River Delta region with Shanghai as the center. It forms a large-scale processing plant + many small and medium-sized processing plants. The most representative factories are Modern dental, Jiahong, Bairui, Kangtaijian, China Dental Laboratory (CDL), etc., and 60%-70% of the denture processing business in the world is in China. In Shenzhen, there are more than 100 companies engaged in denture processing. 

The denture industry has continued to grow in recent years, driven by increased demand for dental beauty, increased oral health awareness, increased disposable income, population growth, and an aging population, and is expected to continue this trend.

On the whole, the industrialization and scale of denture processing have greatly promoted the development of the dental industry, making the denture processing technology homogenized, and at the same time more standardized.

Digitization further reduces production costs

In addition to the technician's own factors, the use of digital technology has changed the process and efficiency of denture production. It is a massive benefit for technicians, doctors, and patients. For example, VR technology can provide a comprehensive view of denture production and measurement, using digital standards to judge the rationality of the design structure is possible, and there are quantifiable improvement effects regarding product quantity, delivery rate, single product output value, and rework scale.

In the past, the mainstream technology of denture production was casting, which required multiple processes in the middle. The process was excellent and could be completed by more than 10 people, Including casting, grinding, polishing, porcelain decoration, etc., the models, waxes, and resins produced in the process are all waste products.

The problem caused by so many processes is that manual errors, and systematic errors in equipment materials are unavoidable, and the more the process, the bigger the mistake.  After the application of digital technology, a large number of intermediate links have been eliminated, and human error has been reduced. The wax, shape, thickness of the design, the size of the connector, the height of the bite, and the tightness of the abutment can all be monitored through digital technology and auxiliary means, and given an error prompt in time.

Also, digital technology has also promoted the development and application of dental restorative materials, especially the use of zirconia all-ceramic materials. Among all the materials, the biocompatibility and aesthetic effects of all-ceramic materials are the best. From 2012 to 2017, all-ceramic products are increasing, and metal-ceramic products are declining month by month.

Finally, digital technology has brought many technical changes. For example, the digital impression technology has gradually evolved from model scanning, and impression scanning to intraoral optical scanning, which dramatically reduces the human error in the impression error and significantly improves the qualified rate of the last wearing teeth.

Prosperous implants, the possibility of future denture industry

From the perspective of large-scale scale, small denture factories are the main form, both in Europe and America, and are similar to clinics. However, in recent years, just as chain brands have increased, big denture factories have been acquiring smaller ones.

The characteristics of the denture industry are that the raw materials of the dentures are mainly developed by the supplier, and the r&d part is more in the product part, with less r&d pressure.

On the other hand, the patient's oral health awareness has improved to varying degrees. The demand for mid-to-high-end oral services represented by oral care, tooth whitening, orthodontics, dental implants has begun to grow at high speed, full-mouth edentulous planting and complex Implant cases are an essential growth area for dental clinics and dental laboratories. Consumer demand has determined that many denture processing plants have begun dental implant business, and dental implants are domestic due to their high technical threshold. For enterprises, it is still a market with great potential.

According to the latest news, dental implants are newly added denture processing business in 2017, mainly targeting foreign markets. Dental implant business is the future direction of oral business development and will increase in 2018 and 2019.

According to the data, the cost of dental implants is almost the same as that of the domestic market. The US is about 3,000 US dollars, and the local price is about 20,000 yuan. However, the proportion of American dental implants is 100-120/10,000, and the number in China is only 2/10,000, which is a big gap.

The opportunities mentioned above for future development, denture companies also face some difficulties, for example, with the increase of large-scale chain clinics that cooperate, these institutions will use their bargaining power, hoping to get lower discounts and prices. To increase sales, we have to give some foreign customers a profit.

According to the data, in the US market, about 40% of dentists now work in conjunction or in the so-called Dental Support Organization (DSO). Domestic capital has also begun to lay out a large number of clinics, and more stores have increased their bargaining power.

Also, the main profit of the denture industry is concentrated in the product sales process. The price of the dental clinic sold to the United States is also very low relative to the final price. As a result, the clinics and doctors actually have the highest profit margin, so the denture processing enterprise the profits are relatively small.

At the same time, with the maturity of 3D printing technology, it will become possible for dentists to produce their own denture products in the clinic. It has been based on the cooperation of medical institutions and local denture processing centers and has become free from space constraints.

The denture factory equipped with digital equipment also poses new challenges to the technician's professional structure. Although the manual operation ability requirements are reduced, the technician's knowledge level is higher, but the entire industry is currently lacking in both stomatological knowledge and computer knowledge. A high-level composite technician with the ability to operate CNC equipment. Denture processing plants not only have to process and supply products to dentists, but also to the providers of dental treatment solutions.