Los Angeles, CA (PRWEB) February 17, 2014
Signage has a buyer power score of 3.3 out of 5. A score of 1 represents lower buyer power and a score of 5 demonstrates high buyer power. According to IBISWorld analyst Jordan Weinstein, this markets strong score reflects a buyer's ability to negotiate lower prices due to the heavy competition resulting from the high number of suppliers. In the three years to 2013, rising corporate profit, total advertising expenditure and the number of businesses led to an increase in demand as the economy began to recover from the recession, allowing suppliers to boost prices for signage. In addition, prices for key inputs, such as the price of plastic, rose over the period. As demand drivers continue to grow with the economic recovery, price is expected to continue rising over the next three years.
Fortunately for buyers, higher corporate profit, advertising expenditure and the number of businesses, mixed with slower annualized increases of input costs, will not substantially raise prices for signage over the next three years, says Weinstein. Many suppliers faced great losses during the recession and were forced to lower their prices to retain as much business as possible, and are only now starting to return prices to prerecessionary levels. Consequently, buyers still have strong negotiating power when selecting a supplier that meets their needs and budget.
Price aside, buyer power remains significant because of the low market share concentration and high level of competition among signage suppliers. Examples of suppliers in this market include Young Electric Sign Company, Jim Pattison Group, Lamar Advertising Company and Sign-A-Rama. The large number of suppliers allows buyers to select from a wide variety of capable providers, no matter the level of specialization, forcing suppliers to compete with lower prices. However, the complexity and degree of specialization greatly affects buyer power; buyers in need of highly complex and specialized signage solutions can expect less buyer power than those in need of more standardized signage. Overall, the high competition among suppliers increases buyer power for all levels of specialization, and will continue to do so in the years ahead. For more information, visit IBISWorld’s Signage procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to help buyers of signage make informed purchasing decisions. Signage includes a wide variety of electrical and non electrical signage, such as illuminated signs, (typically LED or neon),, store front signs or logos, lettering for signs and store displays. This report focuses on storefront signage and does not include banners, billboards, paper signs, traffic signs or safety signs.
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.