Low input costs will keep prices from spiking, although prices are projected to continue to rise as more businesses and construction require vaults or safes and create more demand for installation services
Los Angeles, CA (PRWEB) November 07, 2014
Buyers of safe and vault installation services have a buyer power score of 3.2 out of 5, which indicates that buyers have a slight advantage over suppliers during the purchasing process. During the negotiation process, buyers benefit from a low market share concentration, low service specialization and minimal switching costs. However, rising prices and few substitutes reduce buyer power.
Demand for services is heavily influenced by safe and vault sales. “As more safes and vaults are purchased, more buyers demand installation services,” according to IBISWorld business research analyst, Aileen Weiss. Although the number of banks has dropped during the period, reducing the number of safe or vault installations that banks need, the number of businesses, higher construction rates and greater levels of corporate profit have contributed to higher demand for services and have pushed prices up.
Buyers benefit significantly from a low market share concentration. Because no single supplier controls the market, buyers can pit multiple suppliers against one another during the purchasing process. Additionally, many suppliers are willing to travel outside their regions. This increases the number of suppliers to select from, although buyers should question how travel costs and service prices are impacted.
Buyers also benefit from the low level of service specialization. Although different installation processes vary, such as installing a vault door for a vault room versus installing a safe into the floor, there is little customization between installation plans. In addition, minimal switching costs improve buyer power. Buyers do not need to use the same supplier once an installation is complete. However, if the buyer does commit to a contract for multiple installations for a period of time, the buyer should include a termination clause to avoid any additional risk.
“Though buyers can install safes or vaults with an in-house team, buyers have few other viable substitute service options,” says Weiss. As a result, buyers are pressured to pay market prices. From 2011 to 2014, prices have steadily risen and are projected to continue growing during the next three years. Therefore, buyers should consider procuring services now before prices continue to rise. There are no major vendors in this market. For more information, visit IBISWorld’s Safe & Vault Installation procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of safe and vault installation services. In addition to installation services, vendors generally sell safes and vaults and offer other related services such as repair and maintenance services. Safes and vaults are both used to store valuables, and the primary difference between the two is that vaults are larger than safes and more likely to be built into walls. This report excludes the actual purchase of the safe or vault as well as lock installation 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
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.