Growth in construction activity is forecast to rise through 2016, and increased demand for masonry services will accelerate price growth during the period.
Los Angeles, California (PRWEB) November 08, 2013
Masonry and stonework services have a buyer power score of 3.6. This score signifies that buyers enjoy favorable pricing and bargaining power when it comes to procuring masonry services. The onslaught of the subprime mortgage crisis and subsequent recession has played a large role in bolstering buyer power in recent years. For example, in 2008 and 2009, the number of housing starts fell 35.3% and 35.6%, respectively. Nonresidential construction activity also took a nosedive, falling 21.1% in 2009 and 15.6% in 2010. “These factors led to a huge drop in demand for construction services, including masonry and stonework, and forced suppliers to lower their prices and endure reduced profit margins,” according to IBISWorld procurement analyst Sean Windle. Although construction activity picked up significantly in 2012 and is expected to grow further in 2013, many suppliers are nonetheless still reeling financially from the lingering effects of the recession. This circumstance gives buyers a healthy amount of leverage in negotiating favorable prices.
Also boosting buyer power for masonry and stonework services is the low market share concentration within the market. “Even top suppliers like Western Construction Group, the largest masonry service supplier in terms of revenue, account for less than 1.0% of the total supplier market share,” says Windle. Other top vendors include C.A. Lindman Companies, McGee Brothers and Seedorff Masonry Inc. The low market share concentration gives buyers a variety of options to choose from when sourcing masonry and stonework services.
One factor that can potentially limit buyer power is the high cost of switching suppliers. Once a project is off the ground, switching to a different masonry and stonework service supplier can be expensive. Besides facing potential breach of contract issues, buyers may incur expenses in regard to lapsed time and new setup costs. Furthermore, because skills and specializations among masonry contractors vary, buyers must find a supplier that can pick up where the previous supplier left off, without having to reinvent the wheel.
For more information, visit IBISWorld’s Masonry & Stonework Services procurement research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of masonry and stonework services, which include stone setting, brick and concrete block laying, stucco work and masonry cleaning, caulking and pointing. Service providers may perform this work for new construction projects, or for additions, alternations, maintenance and repair of existing structures. Masonry and stonework services exclude businesses that pour and finish concrete foundations. While a few major providers do exist, the majority of masonry service providers are small companies that serve local and regional markets.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
Vendor Financial Benchmarks
Buying Lead Time
Key RFP Elements
Buyer Power Factors
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IBISWorld is one of the world's leading publishers of business intelligence, specializing in Industry research and Procurement research. Since 1971, IBISWorld has provided thoroughly researched, accurate and current business information. With an extensive online portfolio, valued for its depth and scope, IBISWorld’s procurement research reports equip clients with the insight necessary to make better purchasing decisions, faster. Headquartered in Los Angeles, IBISWorld Procurement serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.