Los Angeles, CA (PRWEB) January 31, 2014
Metal fastening products have a buyer score of 3.3 out of 5.0. This score reflects future pricing trends that will limit the buyer's ability to negotiate from historically high prices. Factors that negatively affect buyer power include a low availability of substitutes, the volatility of input costs and the risks involved with switching providers. However, low vendor financial risk, low market share concentration and low price volatility positively affect buying power.
As the economy continues to recover from the recession, demand for generic fasteners and precision-turned products will increase from major downstream industries, particularly construction. This will lead the market's volatility to be medium during the three years to 2013. Rising steel prices will continue to apply upward pressure to fastening products in the three years to 2016, leading market prices to rise, eroding buying power. "Suppliers have struggled to forecast their input costs because of the volatility in steel prices; however, due to overall price being determined by the numerous products in different markets, price will have a low level of volatility during the three years to 2016," says IBISWorld analyst Erick Delgado. This will help to create a stable purchasing environment for buyers, allowing them to accurately budget and evaluate overall prices.
Due to the durability and strength requirements needed for the majority of end uses, buyers will not be able to use substitute products. Additionally, because precision fasteners are highly specialized, buyers of these products will have higher switching costs than buyers of generic fasteners. These factors negatively affect a buyer's negotiating power for specialized fasteners. According to Delgado, a highly fragmented market and standardization of products, particularly for generic fasteners, has encouraged price-based competition among suppliers. Rising imports have also contributed to increased competition for this product segment, which increases buyer negotiation power. Moreover, the low risk of bankruptcy among suppliers, especially among large manufacturers who have vertically integrated their production process, allows buyers to be more secure when negotiating long-term contracts. For more information, visit IBISWorld’s Screws, Bolts & Nuts procurement research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of metal fasteners for industrial use. These include generic fasteners, such as screws, nuts, bolts, rivets, washers and threaded or non-threaded fasteners; precision fasteners; and turned products that are customized for a particular industry, project or customer. This report does not include plastic fasteners or adhesives.
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.