Los Angeles, CA (PRWEB) August 25, 2014
“Vehicle lifts have a buyer power score of 3.6 out of 5, indicating favorable negotiating conditions for buyers,” according to IBISWorld business research analyst Jesse Chiang. Buyers benefit strongly from low market share concentration and low switching costs. The market is highly fragmented due to minimal differentiation in the functionality and quality of market products. This factor encourages significant market competition and allows buyers to confidently source from smaller vendors without risking purchasing a product that does not meet specifications. Also, many buyers require installation services in addition to shipping the products, making it difficult for suppliers to operate beyond the region in which they are located. Low market share concentration benefits buyer power because suppliers in the market are forced to engage in heavy competition, curbing the rate of price growth.
Low switching costs also benefit buyers because it allows buyers to switch easily between operators, leveraging the lowest price and the best level of service. Buyers can either negotiate for lower prices by leveraging the prices of another supplier or buyers can simply switch to the supplier with the lowest price. There are limited switching costs in the market because buyers have to invest minimally in researching suppliers.
“Although products vary minimally in terms of functionality and quality, buyer power is limited by the lack of substitutes for vehicle lifts. There are products that can lift up vehicles, like car jacks, but such products do not offer the full functionality that vehicle lifts do,” says Chiang. In particular, car jacks cannot fully lift the entire vehicle, limiting its potential uses. The lack of substitutes for market products decreases buyer power because buyers are not able to switch to alternative products if they find negotiating conditions to be unfavorable. Switching products would force buyers to compromise on functionality.
Market share concentration in the vehicle lifts market is low; BendPak Inc., Hunter Engineering Company, Robert Bosch GmbH and Rotary Lift Consolidated Co., four of the top suppliers in the market, account for only 20.0% of total market revenue. Overall, the market is highly fragmented because products do not differentiate much in terms of quality or functionality. Also, many buyers need suppliers to install the vehicle lift, making it more practical to source from localized operators. Low market share concentration and high market competition benefits buyers because suppliers are forced to temper price growth to compete with other suppliers in the market. In the three years to 2014, market share concentration has been increasing marginally as larger operators have expanded operations. Overall, there are 403 suppliers in the market. For more information, visit IBISWorld’s Vehicle Lifts procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of vehicle lifts. Vehicle lifts are used to raise vehicles for parking, storage or maintenance. Vehicle lifts are used by auto repair shops, companies that store their own fleet of vehicles, as well as commercial parking lots and shipyards. Manufacturers and wholesalers are the primary distributors of vehicle lifts. This report does not include car jacks.
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.