Excavators Procurement Category Market Research Report Now Available from IBISWorld

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Prices for excavators have increased over the past three years due to rising global demand, higher emission standards, and increased input costs; because of the volatility in steel prices, manufacturers have struggled to forecast their input costs. To help procurement professionals make better buying decisions faster, business intelligence firm IBISWorld has added a report on the procurement of Excavators to its growing collection of procurement category market research reports.

IBISWorld procurement market research
Prices for excavators are expected to continue increasing over the three years to 2016 as input costs and demand rises

Excavating machinery has a buyer score of 2.6 out of 5. “This score reflects future pricing trends that will limit the buyer's ability to negotiate historically high machine prices,” says IBISWorld business research analyst Erick Delgado. Other factors that negatively affect buyer power are the product high level of specialization and its lack of substitutes. However, decreased financial risk for vendors and low price volatility will positively affect buyer power.

Large manufacturers dominate the excavator market. They build highly specialized products that, other than renting or leasing, do not have any substitutes. This contributes to the industry's moderate degree of market concentration. Manufacturers at the top of the market have strong brand recognition and compete by offering products with the latest technology. While excavators from large manufacturers may be more reliable and efficient, they come at a premium that is essentially nonnegotiable. “Buyers can expect foreign competitors; however, to be more flexible with their pricing,” says Delgado. Major players have increased their market share over the past three years by acquiring smaller manufacturers. Buyer power will further diminish as firms continue with this strategy.

Prices for excavators have increased over the past three years due to rising global demand, higher emission standards, and increased input costs. Because of the volatility in steel prices, manufacturers have struggled to forecast their input costs. This uncertainty has caused producers to keep their prices high in order to avoid a financial loss. Even so, rising global demand for excavators and related machinery will alleviate financial stress for vendors, which will give buyers more security when negotiating long-term contracts. EPA regulations have forced manufacturers to produce more fuel-efficient machines with lower emissions, which has increased their research and development expenses and overall costs to operate. As a result, prices are expected to increase in the three years to 2016, making it more difficult for buyers to negotiate discounted prices. However, buyers may have more ability in negotiating maintenance services, financing and extended-warranty coverage. Major vendors include Caterpillar Inc., Deere & Company, CNH Global N.V. and Komatsu Ltd. For more information, visit IBISWorld’s Excavators procurement category market research report page.

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IBISWorld Procurement Report Key Topics

This report is intended to assist buyers of excavators (e.g. power shovels), which are sold through manufacturers and wholesalers. Excavating machinery includes backhoes on their own dedicated chasis, such as crawler or mini-excavators, as well as long reach excavators and backhoe loaders; all of which can be wheeled or tracked. While an excavator’s primary function is for digging, attachments can be used for material handling and demolition. This report excludes bulldozers and front loaders, forest machines, mining shovels, dredgers, dragline excavators and cranes, bucket-wheel excavators, and all other earthmoving machinery. Also, this report excludes the lease and rental of excavators.
Executive Summary
Pricing Environment
Price Fundamentals
Benchmark Price
Pricing Model
Price Drivers
Recent Price Trend
Price Forecast
Product Characteristics
Product Life Cycle
Total Cost of Ownership
Product Specialization
Substitute Goods
Quality Control
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Competitive Environment
Market Share Concentration
Vendor Financial Benchmarks
Switching Costs
Purchasing Process
Buying Basics
Buying Lead Time
Selection Process
Key RFP Elements
Negotiation Questions
Buyer Power Factors
Key Statistics

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.

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Gavin Smith
IBISWorld Inc.
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