Earthmoving Machinery Rental Procurement Category Market Research Report from IBISWorld Has Been Updated

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In the Earthmoving Machinery Rental market, neither buyer nor vendor has significant negotiation power; buyer power is aided by high competition resulting from low market share concentration, but buyers are hindered by high demand pushing up market prices. For these reasons and to help procurement professionals make better buying decisions faster, business intelligence firm IBISWorld has updated a report on the procurement of Earthmoving Machinery Rentalin its growing collection of procurement category market research reports.

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Prices will continue to grow in response to rising input costs and demand.

Earthmoving machinery rental has a buyer score of 2.6 out of 5, indicating that neither the vendor nor buyer has a significant degree of negotiating power. Buyer power is enhanced by the low market concentration, which means that price-based competition is high among vendors because buyers are able to shop around and compare options from a number of suppliers. Buyer power is also improved by the availability of discounted rates, which are awarded by renting in bulk or for longer periods. Nonetheless, recent pricing trends for earthmoving machinery rental have hampered buyer power. According to IBISWorld procurement analyst Erick Delgado, “due to a boom in construction activity, prices for new earthmoving machinery have increased over the past three years.” Also, environmental regulations have increased manufacturers' research and development costs. Greater regulations, higher interest rates and improved demand have increased the cost for rental companies to update their fleets. With final Tier 4 emission standards expected to kick in by 2015, vendors will be forced to raise rental rates to cover escalating machinery prices.

Because rentals are primarily done on an ad hoc basis, those without annually negotiated rates have had to combat elevated price volatility over the past three years. Luckily for buyers, improving downstream markets will stabilize demand and, thus, keep price volatility low over the next three years. Therefore, buyers will be able to more accurately budget future rentals and compare rates over time.

Furthermore, demand for equipment leasing has consistently grown over the past decade. Market preference has shifted in favor of renting and leasing equipment, because renting ties up less capital than purchasing outright. This trend boosts demand for earthmoving machinery rental and consequently weakens buyer power. “As a result of these conditions, rental rates are anticipated to increase over the three years to 2017, making it more difficult for buyers to negotiate lower rates,” says Delgado. The top three vendors in the market are United Rentals, Sunbelt Rentals, and Hertz Equipment Rental.

For more information, visit IBISWorld’s Earthmoving Machinery Rental procurement category market research report page.

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IBISWorld Procurement Report Key Topics

This report is intended to assist buyers looking to rent earthmoving machinery. For the purpose of this report, the term buyer will refer to any party looking to rent earthmoving machinery. Providers rent earthmoving machinery equipment used primarily in construction. Earthmoving equipment includes trenchers, loaders, excavators, backhoe-loaders and bulldozers, all of which can be wheeled or tracked. This report excludes rental services of other heavy construction machinery and equipment, such as paving equipment, cranes, generators, compaction equipment, material handlers, aerial lifts and forklifts.

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
Market Profitability
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 or call 1-800-330-3772.

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Gavin Smith
IBISWorld Inc.
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