Average prices have risen over the past three years due to a rise in demand for services, allowing operators to raise their prices
Los Angeles, CA (PRWEB) August 15, 2014
Taxation law services have a buyer power score of 3.1 out of 5. This score indicates that buyers have a moderate amount of negotiating power. According to IBISWorld analyst Aileen Weiss, demand for services stems from growth in the number of businesses, more initial public offerings (IPOs) and a greater level of corporate profit. All three drivers have risen in the past three years as the economy has slowly recovered, allowing suppliers to raise prices demand increases. Even so, buyers benefit from a high number of suppliers, the financial stability of vendors and low price volatility.
Examples of market firms include Baker & McKenzie, DLA Piper and Latham & Watkins. With more than 150,600 tax law firms, competition is high among suppliers. As a result, law firms are more willing to negotiate lower hourly fees to gain market share and revenue, continues Aileen Weiss. Small law firms are more willing to negotiate prices than large firms, because competition is even stronger among the small firms. Additionally, because the average supplier is financially stable, buyers do not have to be too concerned about the law firm going bankrupt. The lower supplier risk gives the buyer has many stable suppliers to choose from. The low price volatility for taxation law services also helps buyer power. Due in part to heavy competition, suppliers are constrained in raising their prices too quickly for fear of losing clients. As such, buyers do not have to worry about a huge spike in prices, and suppliers are more willing to negotiate a lower price over a multiyear contract knowing that prices will not change significantly during the contract period.
However, the low level of substitutes diminishes buyer power, leaving buyers with few realistic alternatives. The rising prices for taxation law services is also hampering buyer power. The average hourly fee is forecast to continue rising over the next three years, with demand for tax lawyers growing due to the rebounding economy boosting the number of businesses. Additionally, the increasing number of IPOs has been bolstering demand for taxation law services; businesses have tax lawyers review the effect of the IPO on the business’s taxes. This trend is expected to continue as the economy continues to recover, further hurting buyer power. For more information, visit IBISWorld’s Taxation Law Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of taxation law services. Tax law deals with public authorities’ (i.e. the government) right to impose taxes on taxpayers and require them to pay a portion of their income or property to the authority. This report excludes other types of business law services, including bankruptcy, real estate, mergers and acquisitions, debt collection and healthcare claim law 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.