Vacuum cleaner prices have grown very slowly in recent years as corporate profit has rebounded, allowing for greater investment in industrial equipment
Los Angeles, California (PRWEB) October 04, 2014
Vacuum cleaners have a buyer power score of 3.6 out of 5, indicating favorable market conditions for buyers. IBISWorld market research analyst, Michelle Hovanetz, says, "Slow price growth, low market share concentration, little product specialization and low switching costs have helped to boost buyer power over the past three years."
An estimated 4,200 suppliers provide commercial and industrial vacuum cleaners at the manufacturing, wholesale and retail levels. Major vendors in the market include Techtronic, Electrolux and Bissell. "There is a low level of market share concentration across all supplier types, helping to boost competition among them," says Hovanetz. The relatively low level of specialization required of vacuums further drives competition in the market. Products are largely the same across suppliers, making it easier for buyers to find suitable vendors and compare similar vacuums across brands. Most vacuum purchases are made on an ad-hoc basis due to low switching costs. Low switching costs allow buyers to avoid long-term contracts and change suppliers often, giving buyers greater flexibility and negotiating power with suppliers. These market conditions ultimately give buyers greater purchasing power and result in significant price-based competition. Consequently, price growth has been slow over the past three years.
During the three years to 2014, the prices of key inputs, such as plastic, have pushed up purchasing costs for vacuum cleaner manufacturers. Simultaneously, increased commercial construction and lower office-vacancy rates have boosted demand for cleaning equipment as more commercial space is put to use. Despite rising demand and input costs, high competition among suppliers has helped to keep growth in vacuum cleaner prices slow. This slow, steady price trend is expected to continue in the three years to 2017.
Price-based competition has forced many suppliers to absorb volatile input costs in order to remain competitive, leading to slim average profit margins for suppliers but a stable price trend for buyers. This trend contributes to the moderate degree of bankruptcy risk among suppliers, but it ultimately boosts buyers' ability to negotiate better deals. For more information, visit IBISWorld’s Vacuum Cleaners procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of commercial and industrial vacuum cleaners and their accessories. Sellers of commercial and industrial vacuum cleaners operate at the retail, wholesale and manufacturing levels. This report covers a wide range of vacuum cleaner types, including upright, canister, wet/dry, machine shop and hazardous material models. Handheld and robotic vacuums are not included in this report.
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.