As demand revives and production becomes more efficient, revenue and profit will grow
Los Angeles, CA (PRWEB) May 13, 2013
The Industrial Diamond Manufacturing industry has struggled to shine during the past five years, as the financial crisis heavily impacted industry performance. In the midst of the recession, demand from key markets such as oil drilling and gas extraction, and industrial machinery and equipment manufacturing plummeted. Consequently, industry revenue fell an incredible 45.0% in 2009. As the economy has begun to steady itself, demand from these markets and construction has been revived, says IBISWorld industry analyst Austen Sherman. Industry performance has responded, growing the past two years, including a rise of 5.3% in 2013. Nevertheless, the industry's previous declines have been too much to overcome; IBISWorld expects industry revenue to decline at an average annual rate of 9.6% to $126.5 million during the five years to 2013.
As revenue plummeted, industry profit margins tightened. In response, operators slashed labor costs by reducing employment at an annualized rate of 7.1% from 2008 to 2013. The Industrial Diamond Manufacturing industry has a high level of market share concentration. In 2013, the industry’s major players are Dover Corporation and Diamond Innovations Inc. For the most part, the small number of companies operating in this industry has naturally resulted in high market share concentration, continues Sherman. According to the US Geological Survey, only two industry operators directly manufacture synthetic industrial diamond stones, while the remainder specializes in recovering material from low-quality diamonds or manufacturing synthetic diamond dust.
During the next five years, industry revenue is expected to exhibit strong growth. Demand from all downstream markets is anticipated to rise, and operators are forecast to recapture some of the domestic market they yielded to foreign manufacturers during the past five years. Operators are expected to bring on new employees to meet renewed demand. Despite increased employment, the cost of labor in terms of revenue will decline as the production process becomes more efficient, providing operators with an opportunity to expand profit margins even further. For more information, visit IBISWorld’s Industrial Diamond Manufacturing in the US industry report page.
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IBISWorld industry Report Key Topics
This industry develops and manufactures diamonds for use in industrial manufacturing applications. Products include organic diamonds allotted for industrial purposes and synthetic diamonds created for abrasive purposes.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld 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.