Cost components that are critical across assistive products supply chains:
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Taxes and duties, such as import duties, custom taxes and value-added tax: Import tariffs can range from 10 per cent to 72 per cent depending on the product and country of import and are commonly
passed on to the user. Waiving import tariffs can improve affordability. Recently, Zimbabwe eliminated import taxes on a list
of assistive products for persons with disabilities, such as spectacles, hearing aids and several digital assistive technologies.
(Zimbabwe reference: Value Added Tax (General) (Amendment) Regulations, 2024 (No. 67)) . Nepal also recently announced that prescription spectacles will be exempt from VAT and Customs from 2026. However, even
when countries waive tariffs on imported assistive products, the process to waive tariffs can be tedious and requests are
often rejected without clear reasons. Therefore, many suppliers may prefer to avoid taking advantage of the exemptions to
avoid additional bureaucratic paperwork that may require additional resources and time.
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International shipping: Ocean freights are typically most cost-effective across assistive products and done in a 20-ft or 40-ft container. It is
one of the key cost components for bulkier products such as wheelchairs. Shipping prices can range from US$2,000 to US$20,000
based not only on container size, geography but also volatile factors such as the geopolitical situation, trade routes, port
congestion, availability of shipping equipment and crude oil supply. For example, the shipping cost is particularly high in
landlocked countries in Africa. Since January 2024, ocean freight rates have more than doubled due to longer Red Sea transits resulting in a in June 2024 , with some forecasts indicating price increase to between US$20,000 and a Covid era peak of US$30,000.
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Distributor and retail margins: Distributor margins are one of the largest price components, especially in markets where assistive products are sold through
a network of intermediaries. Distributor margins typically range from 5 per cent to 40 per cent, depending on the product
and market, while retailer margins can be even higher, especially for spectacles, where margins can exceed 200 per cent.
Across the assistive products analysed, the cumulative mark-ups from ex-factory to end-user prices are substantial – ranging
from 25 per cent to over 500 per cent depending on the product type and country context. High base prices, particularly for
products like hearing aids (typically US$100 to US$500), combined with layered costs such as international shipping, warehousing,
distributor and retailer margins and import duties, result in prohibitively high prices for consumers in LMICs.
In some cases, such as spectacles, retailer margins alone can exceed 200 per cent, while in others, like wheelchairs, international
shipping accounts for a major share of the final cost due to bulk and logistics constraints. These inflated cost structures
not only disincentivise investment and scale but also exclude many individuals from accessing essential assistive products.
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