Union Medical Healthcare Launches High-End Aesthetic & Anti-Aging Chain Expansion from Chongqing Base
Health Intelligence Valley is an innovative health industry cluster centered on health management and precision medicine. Leveraging Meinian Onehealth, China’s largest health traffic gateway and big data platform, it provides sample, data, market, and capital support to innovative enterprises.
In 2017, Health Intelligence Valley implemented its strategic layout across six major parks, cumulatively investing in and incubating nearly 100 startup teams and fostering dozens of high-potential “dark horse” enterprises in the health sector with valuations exceeding RMB 100 million. This article is part of a series profiling companies within Health Intelligence Valley’s parks, featuring Weibang Medical: a leader in Hong Kong’s medical aesthetics industry, accelerating its localization efforts, launching in Chongqing, and pioneering a premium chain model for non-surgical medical aesthetic services.
Medical aesthetics has emerged as a major sector within the health and wellness industry, following maternal and child healthcare and dentistry. In 2016, its market size exceeded RMB 300 billion, with a projected compound annual growth rate (CAGR) of 22%–25% over the next five years, indicating substantial growth potential. Capital investors and publicly listed companies are increasingly establishing offline clinics or hospitals through their respective familiar models to pursue chain-based expansion.
In December 2017, as a key investment attraction project of Chongqing Municipality, Union Medical Healthcare Limited (hereinafter referred to as “Union Medical”) signed an agreement with the Yubei District Government regarding the strategic layout of its controlling subsidiary, V'Born Medical, in Chongqing and across China. This marked Union Medical’s entry into the Chongqing market and the launch of its high-end, non-surgical medical aesthetics chain model.
As a leading medical aesthetics service provider in Hong Kong, why did you choose Chongqing as the new landmark for the development of medical aesthetics, and what are the advantages? VCBeat (WeChat ID: vcbeat) interviewed the heads of Hong Kong’s EC Healthcare Group and its subsidiary, Weibang Medical.
VCBeat has learned that EC Healthcare is the largest medical aesthetics group in Hong Kong and a company listed on the Main Board of the Hong Kong Stock Exchange (stock code: 02138.HK). It operates more than 40 medical clinics across Hong Kong, Macau, and major mainland Chinese cities such as Guangzhou, Shenzhen, and Shanghai. Its business portfolio covers medical aesthetics, dentistry, health check-ups, chiropractic care, skincare treatments, and products. With 53 practicing physicians, it boasts the largest number of doctors in Hong Kong’s medical aesthetics industry. Across Greater China, EC Healthcare ranks among the top three in revenue and first in net profit within the medical aesthetics sector.
As of the end of March 2017, the company’s contracted sales amount increased by 44.3% year-on-year, rising from HK$670 million in fiscal year 2016 to HK$970 million in fiscal year 2017. The company’s total revenue grew by 36.9% year-on-year to HK$960 million, among which revenue from medical aesthetic services surged by 82% year-on-year to HK$500 million, primarily driven by rapid growth in its minimally invasive procedures and energy-based device businesses.
Benefiting from robust revenue growth, the company’s net profit increased by 36.3% year-on-year to HK$240 million, demonstrating higher profitability and return on equity compared to industry peers.
As a key node in China’s Belt and Road Initiative, Chongqing has drawn national attention for its robust urban construction and rapid development. With abundant human resources, the Chongqing Municipal Commission of Commerce, the Yubei District Health and Family Planning Commission, and the Yubei Modern Service Industry Investment Promotion Company have provided strong support for foreign investment and the development of the healthcare industry, offering a favorable investment environment and preferential policies.
After careful consideration, EC Healthcare has designated its controlling subsidiary, Weibang Medical, as its mainland China headquarters, establishing it in Chongqing. This move serves as a new strategic starting point for its mainland operations, with plans to expand by 5–10 outpatient clinics or medical centers annually from 2018 to 2020. The expansion will focus on core regional cities, extending its reach across North China, East China, South China, and other regions.
“Compared with cities where the medical aesthetics industry is more developed, such as Beijing, Shanghai, Hangzhou, and Chengdu, Chongqing’s market still lags somewhat in maturity, yet it holds greater potential. Currently, there are few domestic chains with more than 10 outlets, indicating that the medical aesthetics industry remains in its early stages of development. The trend going forward will be toward standardization and chain operations,” stated Yisi and Weibang.
Leveraging 12 years of industry expertise in Hong Kong, China, Medical Aesthetics International has received numerous industry accolades, including the “2017 Asia-Pacific Aesthetic Medicine Market Excellence in Innovation Award” conferred by the globally renowned consulting firm Frost & Sullivan, in recognition of the Group’s exploration and contributions to the aesthetic medicine market in the Asia-Pacific region.
Excluding the Hong Kong market, mainland China’s first medical aesthetics clinic was established in Guangzhou in June 2015. With the aim of setting a new benchmark for the medical aesthetics industry in mainland China, the flagship store in Chongqing is located at Huarong Modern Plaza in Yubei District. Covering an area of 1,000 square meters, it is scheduled to open in March 2018 and will provide customers in Chongqing and across China with world-class anti-aging treatments and products.
Weibang revealed, “In contrast to medical aesthetic institutions that rely on assembly-line operations and extensive management, Yisi has accumulated nearly one million cases. Our professional medical team focuses on delivering more refined, high-quality aesthetic treatments in body contouring and rejuvenation. Body rejuvenation management is relatively underdeveloped in mainland China. Furthermore, we position ourselves in the mid-to-high-end market, avoiding low-price competition. Instead, we prioritize safety and brand reputation, building customer loyalty and positive word-of-mouth through the provision of high-quality medical services.”
Currently, the industry landscape is such that many medical aesthetic institutions achieve substantial revenue volumes. However, after deducting costs for marketing, physicians, and other expenses, their net profit margins remain bleak. At present, Baidu pay-per-click bidding, outdoor advertising, and channel commission-based referrals continue to be the primary customer acquisition channels for many institutions.
Medical Aesthetics International’s strategy has shifted from acquiring new customers to focusing more on managing existing ones. The company shared a set of data: “62% of our clients maintain relationships with us for over three years, demonstrating strong customer stickiness. Since anti-aging is a lifelong pursuit, the repurchase rate is also quite high. We prioritize customer satisfaction and experience above all else.”
In addition, regarding collaborations with mid-to-high-end brands, EC Healthcare also emphasizes strengthening partnerships with institutions in the fashion, tourism, leisure, and financial sectors. “These are well-established brands, and their willingness to collaborate is based on confidence in our brand reputation and safety standards. We are also strategically engaging high-net-worth clients through targeted collaborations with new media platforms and medical aesthetics apps. Unlike some institutions that rely on promotional gimmicks to attract customers, our customer acquisition channels and the target clientele we attract differ significantly from those of other players.”
For most medical aesthetic institutions, chain expansion must first address the issue of physicians by ensuring a professional medical team and comprehensive training.
In this regard, Weibang stated: “EC Healthcare boasts the largest team of practicing physicians in Hong Kong’s medical aesthetics industry, with a total of 53 members, making it a top-tier medical aesthetics team in the Asia-Pacific region. In terms of skills assessment, we carefully select doctors in Chongqing with the best educational backgrounds and experience. They undergo rigorous skills assessments and multiple rounds of interviews conducted by our Hong Kong medical team. Once invited to join our team, these doctors will receive half a month of specialized training in Hong Kong, followed by one month of hands-on practice at our Guangzhou clinic. Additionally, they will engage in weekly video case discussions with the Hong Kong medical team every Monday and Friday. Doctors from mainland China have approximately five opportunities each year to study in Hong Kong.”
As the largest institutional client in Hong Kong for major products such as Botox, Restylane, Juvederm, Sculptra (Sculptra Aesthetic), Dysport, and Teosyal (the latter three of which are not yet launched in mainland China) for eight consecutive years, and having earned the Gold Sales Award for Ultherapy for two consecutive years, EC Healthcare Group provides its practitioners, including those in mainland China, with numerous opportunities to attend and exchange insights at high-level international medical conferences. The group has also been frequently invited as a featured expert to share case experiences at international forums. Its primary objective is to hold physicians to the most stringent standards, ensuring that its medical quality remains among the top tier in the Asia-Pacific region.
In terms of standardization, Medical Thinking Healthcare has also established a standardized process. “Our mature stores, covering approximately 1,000 square meters and staffed by around 20–30 employees, are all managed through integrated systems. Each consultant is equipped with an iPad, while performance evaluation, sales management, and customer relationship management are handled by dedicated systems. This approach not only enhances efficiency and reduces costs but also facilitates chain expansion and management.”
Regarding the current overheating in certain regional medical aesthetics markets, particularly when a publicly listed company enters a local market, it inevitably faces competition from established local brands. In response to this, Weibang stated: “Currently, China’s medical aesthetics market is sufficiently large. There are over 10,000 licensed medical aesthetics institutions in the country; however, competition is fierce and the market is fragmented, with only seven chains operating more than ten clinics. Medical Beauty International operates over 40 clinics across Greater China. Weibang positions itself as high-end and safe. In our niche segment, there are no strong brands, or even a brand vacuum. We are committed to facial and body rejuvenation, employing differentiated strategies in terms of service offerings and target customer segments.”
Under current policies, as regulations become more standardized and consumers place increasing emphasis on safety, the operating space for unlicensed, small-scale illegal clinics will undoubtedly continue to shrink. In the future, the key to success for medical aesthetics institutions will lie in building brand advantages through physician competence, brand strength, and safety.
In the future, Weibang Medical will introduce EC Healthcare’s advanced concepts, management expertise, and clinical technologies, strengthen economic cooperation and technical exchanges between Chongqing and Hong Kong, and further promote the prosperity, standardization, and healthy development of the medical aesthetics industry.