The price of industrial furniture is forecast to increase due to growth in industrial production
Los Angeles, CA (PRWEB) February 14, 2014
Industrial furniture has a buyer score of 3.2 out of a 5-point scale, indicating a moderate degree of buyer leverage in the negotiation process. The score is reflective of the large number of industrial furniture suppliers competing in the market as well as the low degree of market share concentration. Consequently, there is significant price-based competition among industrial furniture suppliers. There are also low switching costs between suppliers, given that the majority of purchases are ad hoc. According to IBISWorld procurement analyst Natalie Everett, “From this market fragmentation, buyers gain a greater degree of flexibility when negotiating prices.”
In the past three years, prices for industrial furniture have increased slowly, rising at an annualized rate of 2.2% from 2010 to 2013. Price growth has been underpinned by rising steel prices and increased demand from industrial clients, following the end of the recession. The benchmark price for industrial furniture is relatively low. However, prices vary significantly depending on the type of item, material and volume purchased. Buyers also benefit from the low degree of price volatility, which enables greater flexibility when timing purchasing decisions. The buying lead time for industrial furniture extends between two and six weeks. Because of its short lead time, buyers are better able to source industrial furniture from multiple suppliers and take advantage of favorable pricing trends in pricing materials. “Nevertheless, volatility in commodity pricing for steel and lumber present a potential risk along the supply chain for buyers, given that these costs are factored into industrial furniture prices for buyers,” says Everett.
Typically, items are priced based on their height, width and weight capacity. The type of material used in industrial furniture is another key determinant of its cost. Stainless steel is typically the durable material for industrial work surfaces, storage and shelving, a factor that lowers its total cost of ownership for buyers. Hardwood is priced on the upper end of the market, and although commonly chosen for its aesthetics, is more likely to be used for specialized applications such as electrical work. While plastic is the most economical choice for buyers, it also has a lower level of durability compared with steel furniture and may lack resistance to certain chemicals. Consequently, stainless steel is by far the most common material used for industrial furniture. The top four vendors in the industrial furniture market are Koninklijke Philips Electronics NV, Acuity Brands, WESCO International, and Hubbell.
For more information, visit IBISWorld’s Industrial Furniture procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to help buyers of industrial furniture. Industrial furniture includes work surfaces, cabinets, storage, lighting and isolation platforms that are intended for use in manufacturing facilities. This product group specifically excludes furniture intended for commercial or household use. Suppliers typically include diversified furniture manufacturers and distributors.
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.