Industry Assignment – Health Care

Companies in the health care industry provide a wide range of health care and social services through hospitals, doctors’ offices, nursing homes, outpatient surgery centers, and other facilities (Hoovers, 2013). The company at the top of the list in the health care industry is UnitedHealth Group, Inc. UnitedHealth Group, Inc. provides health care coverage, software and data consultancy services. The company operates through four business segments: UnitedHealthcare, OptumHealth, OptumInsight and OptumRx.

The company had total sales of $110,624.00 million, with the highest market share of 23.85% and 5% net profit margin. A company would ideally want both strong profit margin and large market share. UnitedHealth Group, Inc. has the highest market share in the health care industry, indicating that the amount of products sold by the company is the highest in the market. However, it does not always mean that the company has highest profitability. The net profit margin is a ratio that describes how much profit a company makes for every dollar of sales (Connell Curtis Group, 2012).

Unfortunately, UnitedHealth Group, Inc. has a net profit margin of only 5%, where as other companies in the industry, with relatively lower market share, have much higher profitability. Some of the reasons for the low profit margin could be that the company has to spend large amount of money on the cost of goods sold, overhead or both, due to its large market share, and the variety of products it offers.

Industry| | | | |Rank| Company Name| Sales (USD m)| Net Profit Margin| Market Share| 1| UnitedHealth Group, Inc.| 110,624.00| 5%| 23.85%|2| Express Scripts Holding Co.| 93,858.00| 1%| 20.23%| 3| WellPoint, Inc.| 61,828.00| 4%| 13.33%|4| Humana, Inc.| 39,126.00| 3%| 8.43%|5| Aetna, Inc.| 37,806.70| 4%| 8.15%|6| HCA Holdings, Inc.| 33,013.00| 5%| 7.12%|7| Cigna Corp.| 29,130.00| 6%| 6.28%|8| Fresenius SE & Co. KGaA| 24,860.95| 4.80%| 5.36%| 9| AbbVie, Inc.| 17,443.95| 20%| 3.76%|10| Medtronic, Inc.| 16,184.00| 21.10%| 3.49%|| TOTAL| 463874.6| | 100.00%|| | | | |

ReferencesConnell Curtis Group. (2012). Business growth consulting: Profit margin versus market share. Retrieved from http://www.connellcurtis.com/business-growth-consulting-profit-margin-versus-market-share/

Factiva, Inc. (2013). UnitedHealth Group, Inc. Retrieved from http://0-global.factiva.com.olinkserver.franklin.edu/pcs/default.aspx

Hoovers. (2013). Health care sector industry overview. Retrieved fromhttp://www.hoovers.com/industry-facts.health-care-sector.1374.html