Los Angeles, CA (PRWEB) May 17, 2014
Landscape architecture and design services have a buyer power score of 2.9 out of 5. According to IBISWorld procurement analyst Jordan Weinstein, “this score reflects moderately poor negotiation conditions for buyers resulting from high demand, low availability of substitutes and high product specialization within the market.” After demand for landscape architecture and design services dropped during the recession, it has been rising steadily during the three years to 2013, driving up prices for buyers. Although prices are still below prerecession levels, buyers are losing negotiating power as demand is restored. Meanwhile, landscape architecture and design services provide a very customized solution for the buyer that cannot easily be produced by untrained suppliers. As such, competitor growth is slowed, limiting the extent to which supply can keep pace with rising demand. Consequently, buyers are facing suppliers with limited incentive to negotiate or maintain lower prices.
Buyer leverage is projected to shrink further during the next three years, as demand drivers such as business growth, homeownership rates, and government funding for universities rise and apply additional upward pressure on demand. Rising demand will offset the slow competitor growth forecast in the next three years and limit the availability of suppliers to the buyer. “Consequently, buyer power is projected to be strained further,” says Weinstein. The complexity and size of the buyer's project will impact the amount of negotiating power they experience. Buyers with larger, more complex facilities will be better able to attract both large and small service providers, increasing the number of suppliers available to them. Furthermore, suppliers will typically value their business more. As such, buyers with larger projects will generally experience more buyer power.
The supplier’s licensing and experience are the largest factors affecting landscape architecture and design service prices. To obtain licensing, suppliers must prove to a governing board they have the level of experience necessary to provide quality service. Licensed professionals are then able to charge premium prices for having this third-party approval. In addition to licensing, buyers will often look to the level of experience suppliers have as an indicator of the quality they can expect. As such, buyers will often be willing to pay larger fees to those suppliers with more experienced staff members. The four largest vendors in the market are AECOM, Cardno, Jacobs Engineering Group and SmithGroupJJR.
For more information, visit IBISWorld’s Landscape Architecture and Design Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of landscape architecture and design services. Landscape architecture and design service suppliers prepare drawings and specifications related the development of land areas. They employ creativity and an in-depth knowledge of grading, drainage, horticultural and structural spacing to the planned arrangement of natural and constructed elements on the land. Their primary purpose is to create useful and attractive outdoor environments that conform to governing codes and regulations. This report excludes landscape construction services in addition to maintenance services, such as installing and caring for trees, lawns and gardens.
Recent Price Trend
Product Life Cycle
Total Cost of Ownership
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Market Share Concentration
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.