What is the price of IV set?

Product price

Product price is the sum of fixed, variable, and semi-variable costs spent during the product’s production, distribution, and selling—the IV set in particular. It serves as the principal basis for calculating the IV set price. Fixed costs are those which remain fixed at all levels of production or sales. Examples of fixed costs are the rent of buildings and the salary of employees. Variable costs refer to the costs directly related to production or sales levels. Examples are the costs of raw and packaging materials and labor costs. Semi-variable costs change with the level of activity but not in direct proportion. For example, a fixed salary of RMB 12,000 + up to 6% graded commission on sales volume increase.

The starting point for calculating the possible price of a product is the product cost. If the product cost is high, the selling price will also increase. In the production of an IV set, three variable costs greatly influence its price. These are raw materials, packaging materials, and labor costs. Until now, the price of our IV sets has ranged from 0.06 USD/each to 0.1 USD/each. You’re welcome to contact us for the latest prices.

Cost of raw materials

Polyvinyl chloride (PVC), acrylonitrile butadiene styrene (ABS), polyethylene (PE), polypropylene (PP), and other materials principally make up the IV set. The costs of these raw materials fluctuate and change frequently. Thus, when the costs of these materials rise, the IV set price also increases. For the sake of clarity and objectivity, consider Figure 1. In the last four years (2017-2020), the average cost of PVC was 891 US dollars per metric ton. In the last two previous years (2021-2022), the average price rose to 1,315 US dollars per metric ton, an increase of approximately 48%.

Based on Table 1, the prices of ABS averaged 12,262.50 RMB per ton from September-December 2022. In January-February 2023, it rose to a maximum average of 12,750 RMB per ton, an increase of approximately 4%.

Table 1 shows the price trends for both the HDPE and LDPE. From September to December 2022,   the price of HDPE has been averaging 8,750 RMB per ton, while the LDPE has been recording an average price of 9,812.5 RMB per ton. In the first two months of 2023, HDPE’s price rose to a maximum of 9,000 RMB per ton, while the LDPE registered a maximum price of 10,000 RMB per ton, giving out price increases of 2.86 % and 1.91%, respectively.

In Table 1, the average price for PP from September-December 2022 was 8,937.5 RMB per ton.  In the first two months of 2023, the price shot up to a maximum of 9,500 RMB per ton, registering an increase of 6.3%.

Based on the preceding price data, the prices of the principal components of the IV set have increased in the first two months of 2023, ranging from 1.91 to 48%.  These increases will surely lead to an increase in the IV set price.   

Cost of packaging

Packaging of the IV set needs a PE bag, paper pouch bag, box, and carton. Increases in the costs of these materials will increase the IV set price. More importantly, PE is the primary material for producing packages, such as single-use plastics, for the IV set. Thus, changes in the price of PE will directly affect the IV set price. Four factors directly affect the prices of PE: (1) price of raw materials, (2) demand for PE, (3) PE producer inventory, and (4) manufacturing delay or interruption. These, in turn, will affect the IV set price.

Price of raw materials for PE

When crude oil, additives, and other materials needed to produce PE resin become less available, the resin’s cost increases. The increase in resin’s cost arises from the tendency of PE manufacturers to buy raw materials at a higher price. In turn, these manufacturers recover their more significant expenditures from the consumers by increasing the IV set price.

Demand for PE

The demand for PE and its products fluctuates locally, nationally, or internationally. For instance, the demand decreases if social and political movements discourage using single-use plastics to reduce non-biodegradable wastes. On the other hand, the demand increases if prospective users cite sanitary reasons for using single-use plastics. PE prices will significantly increase if there is high demand, and this situation worsens if there is a low supply of PE. These changes will directly affect the IV set price.

PE producer inventory

The available supply of PE will affect its market rate. Producers may offer their products at lower prices if there is a surplus of PE at the end of the year. They do this to reduce their inventory at the start of the New Year. Conversely, the prices for manufacturers and consumers will increase if there is a low supply of PE and high demand.

Delays or interruption

Interruptions in the production, delivery, or manufacturing of PE and PE products could alter the interactions between supply and demand. Disturbance in the supply-demand relationship could increase prices in PE and the IV set price. The cost of PE may go up suddenly if the production of PE resin shuts down for any reason or uncontrollable events delay the shipment of materials.

Labor cost

Labor costs include wages, payroll taxes, sick days, and workers’ benefits. Their computation needs to be accurate because it is one of the bases for calculating the IV set price. Thus, when the labor cost is high, the IV set price must also be increased. Otherwise, it could adversely affect the company’s profits if the manufacturers incorrectly compute the IV set price. Different companies reward their employees with salary increases at the start of the year and yearly medical check-ups. These additional expenditures will surely increase the IV set price.

Exchange rate 

The exchange rate of the Renminbi (RMB) to the US dollar also affects the IV set price. Changes in exchange rates directly affect businesses because the cost of supplies purchased from a different country may increase.

For instance, when the RMB appreciates against the US dollar, it will be more expensive for American customers to import Chinese goods. Conversely, if the RMB depreciates against the US dollar, Chinese goods will be cheaper from the point of view of the American market. Another example is this: when the Turkish currency (lira) depreciates against the US dollar, and the yuan appreciates against it, then Turkish customers will shell out more lira to buy Chinese goods. 

Demands from overseas customers may decrease because of IV set price increases. Several factors play a role in determining the exchange rate. A private company may be unable to do anything except change the IV set price. 

Government and legal regulations 

In some countries, the government controls the prices of medical devices considered essential and needed in healthcare. Government authorities call them “suggested retail prices” (SRP). Consequently, dealers and distributors cannot increase their prices beyond the SRP, especially if the company or the manufacturer monopolizes the product. In addition, environmental policy arising from the government or private sector may also increase the factory cost.

Degree of mechanization 

Mechanization reduces human efforts in manufacturing. Through automation, machines perform the manufacturing processes instead of the hands of workers. It is very much needed nowadays because it provides more excellent production at the lowest possible time and a lower cost. Using machines reduces the need for workers, reducing labor costs. With lowered labor costs, IV set price will decrease. The higher the mechanization, the lower will the IV set price be.  

If you are interested in any products, please don’t hesitate to contact us for the prices.