As interest rates grow, demand for planting and seeding machinery will soften, causing market prices to rise at a slower rate in the next three years
Los Angeles, California (PRWEB) December 13, 2014
Within the planting and seeding machinery market, buyers have a buyer power score of 3.3 out of 5, indicating a moderately favorable purchasing environment for buyers. According to IBISWorld market research analyst, Erick Delgado, "Buyers derive power primarily from the high availability of planting and seeding machinery and the low switching costs associated with changing vendors." Additionally, the market's low level of supply chain risk and vendors' overall secure financial structures and conditions contribute to buyer power. Major vendors in the market include Deere & Company, AGCO Corporation and CNH Industrial.
Planting and seeding machinery is supplied by a wide range of vendors; buyers can look to vertically integrated agribusinesses such as Deere & Company to procure this equipment, or they can source from locally based farm machinery manufacturers or wholesalers. "Additionally, imported machinery is also a viable option, though buyers should consider additional costs associated with foreign-made products such as shipping and tariffs," says Delgado.
Low levels of supply chain and vendor risk give buyers confidence in their machinery purchases. While inputs and demand conditions fluctuate year on year, the availability and price of machinery is relatively constant, allowing buyers to more easily budget for their purchases and retain confidence that the price they are paying will not change drastically in the coming years. Individual suppliers also display a reasonably stable environment with little risk of bankruptcy. The market's largest vendors are multiline, multinational businesses that generate revenue through a variety of streams. As such, the likelihood of financial struggles is low.
Still, buyers do face some obstacles in procuring planting and seeding machinery. First, the lack of substitute products indicates that demand for planting and seeding machinery is inelastic, and forces buyers to take the prevailing market price. Additionally, the high market share concentration among the top four vendors limits buyers' choices. Smaller vendors may be able to supply more specialized products, but large vendors are more likely to have the scope and capacity to fill large and diverse orders. Large vendors also offer value-added services like insurance, warranties and buy-back programs that buyers are likely to benefit from. For more information, visit IBISWorld’s Planting & Seeding Machinery procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of planting and seeding machinery, which includes dry and drum seeders, transplanters, seed and grain drills, hole diggers, germinators, soil covering machines and related attachments. This report excludes manual planting and seeding equipment, and all other types of farming machinery.
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.