The price of metal shells and casings has been rising primarily due to strong demand from the consumer market that has stemmed from the fear of tightening regulations
Los Angeles, CA (PRWEB) November 20, 2014
Metal shells and casings have a buyer power score of 2.3 out of 5. According to IBISWorld analyst Ian Buchanan, this score reflects pricing trends that negatively impact buyers and indicates a low level of buyer bargaining power. Prices have increased over the past three years largely as a result of swelling demand brought forth by the fear of increased regulation on guns and ammunition. Uncertainty over future gun laws is encouraging end users to stock up on guns, ammunition and related materials out of fear that it may be difficult to buy these products in the future. Guns, ammunition and related components, including metal shells and casings, are now flying off the shelves faster than manufacturers can create them. Because of this, many suppliers, such as Alliant Techsystems Inc., Olin Corporation and Freedom Group Inc., have placed limits on the number of shells buyers can order and many popular calibers of casings have been placed on backorder. Mounting demand for the metal shells and casings has placed upward pressure on prices, negatively affecting a buyer's purchasing power. Furthermore, a low availability of practical substitutes, coupled with high regulation, has only served to exacerbate current buying conditions. Knowing that buyers have limited alternatives to metal shells and casings, suppliers gain greater pricing leverage and buyer power is diminished further.
Unpredictable metal prices over the three years to 2014 have also contributed to a reduction in buyer power, continues Buchanan. Unstable prices for copper, the key input in brass, have resulted in higher prices for metal shells and casings. Manufacturers view volatile inputs as a risk, and therefore have attached risk premiums to their products as a way of protecting profit margins. In a market with high demand, buyers have no choice but to accept price increases. Fortunately for buyers, the level of input price volatility is forecast to decrease over the next three years, making it easier for buyers to budget for future purchases.
IBISWorld projects that price trends over the next three years will be very similar to those of the previous three years. However, further regulation against these products in the future could adversely affect purchasing power, so buyers should keep a close eye on legislation pertaining to this market. For more information, visit IBISWorld’s Metal Shells & Casings procurement category market research report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Like IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of metal shells and casings. Metals shells and casings compose the outer layer of firearm ammunition. They can be purchased from retailers or directly from manufacturers. Metal shells and casings are purchased to be used as a component in reloading cartridges to make live ammunition. Bullets, primers, propellants and plastic shells and casings are excluded from 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.