Oral SaaS breaks the cocoon

Image source @ Visual China

Text | Financial external reference

Before there was the doctor of dentist who rang the bell to go public, and then there was Meiwei Dental, which has received multiple rounds of financing, and the oral medical track has been optimistic for a long time. With the gradual development of the oral medical industry, "small shop chaining" has become a new trend in the oral track, and information management has also become a rigid demand for dental clinics.

Under the call of informatization, oral SaaS is once again active in front of the public, but it is not a new species. China's oral SaaS enterprises were sharp as early as 2016, but at that time, the domestic environment was not mature, SaaS companies were difficult to develop, and oral SaaS players were also struggling. With the improvement of the financing environment in the industry, oral SaaS companies have become hot again. As of the end of 2021, Lingjian and Feilin Technology, two oral SaaS head players, have received D round financing.

Oral SaaS has arrived

The re-emergence of oral SaaS companies in the spotlight is not an overnight hit, but thanks to the benefits of multiple factors.

First of all, the improvement of the underlying technology of SaaS and the needs of users have spawned the oral SaaS industry. The rise of cloud vendors such as Alibaba Cloud and Baidu Cloud, as well as the improvement of underlying technologies such as blockchain technology and artificial intelligence technology, have provided fertile ground for the development of SaaS enterprises. At the same time, people's attention to oral health has promoted the brutal expansion of oral clinics, and dental clinics have moved towards chaining, scale and standardization. Under the dual dividends of technology and demand, the oral SaaS industry ushered in a window period.

Secondly, the entry of many players has jointly promoted the development of the oral SaaS industry. It is difficult for a company to support a track, and only the continuous confrontation of multiple companies can inject new vitality into the track, and the same is true of the oral SaaS track. In oral SaaS, there are many oral SaaS service providers such as Eggplant Oral Cloud, which is highly acclaimed for its free model, Lingjian e-Dental, which has an increased supply chain, and Yunxi Technology, which has ophthalmic dentist resources, and these players jointly promote the development of the oral SaaS industry through the form of industry competition.

Finally, capital is bullish on the oral SaaS track. For technology companies such as SaaS, the support of real money and silver in the capital market is particularly important, whether it is burning money to grab customers, or investing in research and development, the development of SaaS enterprises is inseparable from the support of capital. According to the "2021 China Oral Medical Service Market Analysis Report" released by Guanyan Tianxia, in the past decade, the financing amount of oral SaaS is second only to oral medical institutions, and its total financing has exceeded 12.13 million US dollars.

The ice of SaaS commercialization is hard to break

Driven by many parties, oral SaaS has grown into a golden track that is highly optimistic about the market. However, on this high-profile track, oral SaaS service providers are still worried.

Externally, localization platforms are eyeing the tiger. Localization platform due to the early entry into the market, and long-term deep ploughing industry pain points, so it not only captured the user's mind, but also has conquered many large dental chain hospitals, large stomatological hospitals have a high sensitivity to informatization, its localization platform is mostly transformed by the HIS system of large hospitals, after decades of running-in has formed a relatively complete management system, such as Beijing Stomatological Hospital, Jiamei Group National Chain, Beijing Military Region General Hospital and other large stomatological hospitals are using localization platforms for information management.

Second, the data storage of the localization platform is more private and trusted by users. With the attack of Apple cloud servers, privacy leaks and other data security issues, users are worried about information security, and clinics also pay more attention to data security and system stability. Local storage is not only not limited by factors such as the network, but also enjoys data control to the greatest extent, which greatly protects the user's data security. Therefore, even if "going to the cloud" has become a major trend in the industry, many clinics still choose local storage and firmly grasp the data in their own hands.

Internally, the unit price of oral SaaS products is low, and the commercialization effect is not significant. In terms of payment, localized platforms generally pay a one-time fee, while domestic SaaS platforms generally pay annually, but most oral SaaS companies are difficult to make profits from SaaS services. According to the report of Yiou in 2019, the charging standard of e-kan teeth is between 3000-5000 yuan / year, and from the overall charge of the oral SaaS industry, the annual service fee of a store is about 1500 yuan to 3000 yuan, but the unit price is so low that most players in the field are still in a state of loss.

In addition, many oral SaaS service providers have also started a price war in order to seize the market, and even entered the market in a free mode. For example, dental SaaS service providers such as eggplant oral cloud and dentist housekeeper, in the case that the unit price of customers is not high, oral SaaS players "roll up" themselves also further increase the cost of customer acquisition of enterprises. At the same time, the people have not yet developed the habit of paying for Internet products, in this case, free oral SaaS software is naturally more popular with clinics, these factors have led to the survival of oral SaaS enterprises.

The head player finds another way out

Under the attack of internal and external troubles, oral SaaS players have begun to transform... From the perspective of Lingjian and Feisen Technology, they have become consumables e-commerce and opened a new era of oral SaaS.

Consumables are an indispensable part of dental clinics, but this has also become a heart disease in many dental clinics. First, the domestic oral consumables suppliers are more dispersed, and the dental clinics are quite difficult in the procurement of consumables; second, the consumables commonly used in dental clinics are mostly disposable items, and the demand is large, but most dental clinics are unable to build their own warehouses, and the storage of disposable consumables has become a first-class problem; third, small and medium-sized dental clinics have not yet formed a scale effect, and it is difficult to have a say in the bargaining of consumables, thus thinning the profits of the clinic.

In the face of the collective plight of dental clinics, Lingjian and Fizen Technology have invariably set their sights on the B2B consumables supply chain, and want to fundamentally solve this big annoyance for small and medium-sized clinics, but these two dental SaaS head companies play differently in the B2B consumables supply chain.

The consumables supply chain of Lingjian e-Dental is a reference to Henry Schein's supply chain model, introducing third-party distributors and brand parties, and adopting a platform model that combines self-operation and matching to provide a one-stop consumables equipment procurement platform for dental clinics. In addition, in 2022, Lingjian is expected to add warehouses in cities such as Beijing, Guangzhou, Wuhan and Chengdu to radiate more dental institutions.

The dentist butler's play in the supply chain is both advanced and quite confusing. As we all know, dentist housekeeper is the SaaS service platform under Fizen Technology, and Fizen Technology is also quite distinctive in the creation of the supply chain, on the one hand, it cooperates with brand owners to create a dentist butler mall, on the other hand, its holding company Cong heng technology has also launched an online customized oral equipment mall, and holds the dentist help. In other words, Fizen Technology has three clear veins in the consumables supply chain and has extremely sufficient consumable resources.

Harmony and difference, different playing styles

The transformation of Lingjian and Feisen Technology as a consumables e-commerce is indeed a good way, but in the era of industry homogenization, differentiation is the highlight. As a result, they are aiming in new directions.

Lingjian aims at the sinking market. When it first entered the market, dental SaaS companies struggled to seize the high-end dental clinics, but as dental medical clinics got rid of the barbaric growth stage, the large-scale expansion of stores no longer existed, dental SaaS companies also fell into the dilemma of customer acquisition, and the untapped sinking market became a new growth pole for dental SaaS companies. After obtaining the D+ round of financing, Lingjian said that in 2022, it will establish regional service teams in more third- and fourth-tier cities, greatly expand the coverage area and scale, and further explore the sinking market.

Fussen Technology chose to further lay a solid foundation, focusing on the optimization of digital imaging products and software upgrades. Born from Fizen Technology, the dentist butler SaaS is originally from the digital image to enter the game, open up the digital imaging equipment and SaaS software management, realize the docking of the two, targeted to solve the follow-up problems such as digital image distribution, and create a distinctive ecosystem. According to media reports, the D round of financing of Fizen Technology will be mainly used for the continuous optimization of the company's digital imaging hardware products and the acceleration and upgrading of the software platform.

brief summary

At a time when the call for informatization is getting louder and louder, the SaaS track is a scene of fiery cooking oil and flowers, which also makes players in other tracks envious, but oral SaaS companies are not as glamorous as they seem on the surface. It is difficult for them to achieve profitability by SaaS service fees, and it is difficult to conquer large stomatological hospitals, and they can only continue to wait for the arrival of the spring breeze of the industry by means of border expansion and strong strength.

Surprisingly, the resources and data advantages accumulated by oral SaaS service providers in the process of software services have also become their most solid armor. For example, within 3 months, 75% of Its SaaS customers converted into consumables customers. Whether it is to expand the boundaries to survive, or differentiated survival, this is understandable, but if the service can not keep up, is there any user willing to buy it? Whether oral SaaS companies can really ride the wind, we will wait and see.