3. Assistive products supply cost drivers

Given the heavy reliance on out-of-pocket expenditure in LMICs, the high final cost of assistive products remains a major barrier to access to and demand for AT. Affordability of assistive products is heavily affected by added costs from the manufacturer to the end-user. These include shipping and insurance fees, import duties and in- country taxes. Once the product arrives in the destination country, storage costs, in-land transportation fees and distributor margins further increase the final price. Understanding the breakdown of these costs is critical for addressing the affordability challenges faced by consumers in LMICs. This section provides visibility into these cost components to help buyers understand the drivers of the final landing price of assistive products.

The cost estimate analysis in this report is based on secondary research and primary data collection from social enterprises, corporate foundations and NGOs, reflecting actual costs across various markets, adjusted for geographical and economic differences. The provided cost ranges account for regional pricing variability influenced by factors such as import duties and taxes, fluctuating shipping costs due to geopolitical conditions and seasonal demand, varying distributor and retailer margins depending on market competitiveness and regulatory frameworks, economies of scale from bulk purchasing, and additional expenses arising from regulatory and administrative barriers like customs procedures and certification requirements.

By presenting both lower and higher estimates, the report aims to give stakeholders a realistic understanding of the cost implications in different procurement scenarios. It is important to note that this report focuses solely on supply cost associated with products and does not consider other essential costs such as diagnostics, fitting, repair, and maintenance, training and other critical aspects of service delivery. All of these are vital for ensuring the provision of an assistive product. It also does not consider non- financial costs such as lead times, among other factors.

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