The price of services has been increasing due to rising operating costs and an uptick in demand brought on by higher construction activity.
Los Angeles, CA (PRWEB) May 24, 2014
Building site preparation services have a buyer power score of 2.9 out of 5. This score signifies that buyers in the market have a moderate level of power. According to IBISWorld analyst Deonta Smith, buyer power is positively influenced by low market share concentration, but negatively affected by a high level of specialization and the low availability of substitutes for services.
Because of the highly fragmented nature of the market for building site preparation services, buyers have a wide selection of service providers to choose from. This is because most service providers operate solely on a local level, thus limiting their reach. Additionally, the majority of service providers are small, continues Smith. Almost 90.0% of building site preparation contractors maintain a workforce of 20 employees or fewer. Major suppliers include Hayward Baker Inc., Malcolm Drilling Company Inc. and Berkel & Company Contractors Inc. A greater variety of providers increases a buyer's options and therefore boosts buying power. There are several factors, though, that limit buyer power. Because buyers enter into contractual agreements with only one service provider, it is difficult for buyers to switch between suppliers without incurring a loss. Therefore, the lack of substitutes for these services narrows the buyer's scope of possibilities.
Additionally, the high level of specialization associated with these services hinders buyer power. A further impetus for buyer power is if a buyer is not satisfied with the large-sized service provider that services their geographic location, a smaller firm may be available as an alternative. A small-sized service provider can help buyers obtain leverage by creating competition during the negotiation process. Buyers can purchase building site preparation services from contractors located within their operating region to obtain transportation discounts. However, seeking out large service providers that operate on a wider scale will expand the range of contractors from which a buyer can choose. For more information, visit IBISWorld’s Building Site Preparation Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of building site preparation services. Contractors provide site clearing and excavation work as a means to prep land for new developments. This report does not cover general contracting services.
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
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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.