Over the next three years, actuator price growth is forecast to accelerate as the improving economy bolsters manufacturing output and increases demand for actuators.
Los Angeles, CA (PRWEB) December 30, 2013
On a scale of 1 to 5, with a higher number indicating better negotiating conditions for buyers, actuators have a buyer power score of 3.1. This score reflects the fact that buyer power is mixed when it comes to sourcing actuators. A moderate level of concentration among actuator suppliers gives buyers many options to choose from; however, the specialized nature of these products also gives suppliers a degree of leverage over buyers. "Limiting the negotiating power of buyers is the fact that many suppliers utilize a cost-plus pricing model, in which actuator prices are tied directly to the cost of production, with a designated profit margin on top," says IBISWorld industry analyst Sean Windle. A major factor in the cost of production for actuators is the price of raw materials, such as steel. Over the past three years, the price of steel has risen at an annualized rate of 2.5%, with many buyers forced to absorb the additional input costs through higher product prices.
In addition, buyers are at a disadvantage due to the highly technical and specialized nature of actuator products, which are often customized to serve specific functions within a company or industry. This fact can sometimes limit the field of available suppliers, and also makes it more costly to switch from one supplier to the next. According to Windle, Setting up a supply agreement for actuators is an expensive proposition for both buyer and seller, as both sides must devote resources to understanding the needs and capabilities of the other. In addition, suppliers may need to modify existing machinery and equipment, or train employees on specific functions required by the buyer. These factors can sometimes offset any potential savings that would result from switching suppliers.
Despite these challenges, buyers usually have a variety of actuator suppliers to choose from. Concentration among actuator suppliers is moderate, and IBISWorld estimates the top four suppliers will account for less than 40.0% of the market share. Depending on the level of customization required for their product, this gives buyers a broad field from which to utilize global, national, regional and local suppliers. For more information, visit IBISWorld’s Actuators procurement research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to help buyers of actuators. Actuators are a type of motor for moving or controlling a mechanism or system, and can be divided into four different types depending on how they are powered: hydraulic (liquid pressure), pneumatic (air pressure), electric and mechanical. Actuators have applications in a number of different industries, such as heavy machinery and industrial equipment manufacturing, aerospace and automobile production. While many suppliers are manufacturers, wholesalers also provide actuators.
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
About IBISWorld Inc.
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.