Prices have been rising due to increasing production costs and growing demand stemming from the economic recovery
Los Angeles, CA (PRWEB) December 23, 2014
Interior design services have a buyer power score of 3.3 out of 5, indicating market conditions that are somewhat favorable for buyers. According to IBISWorld analyst Kiera Outlaw, low market share concentration, which has fuelled competition among suppliers, combined with moderate product specialization and low supply chain risk has worked in favor of buyers. With over 96,000 suppliers available, including Jacobs Engineering Group Inc., AECOM and Gensler, no vendor accounts for more than 5.0% of market share, and buyers can pit suppliers against one another to obtain the best pricing. Moreover, the large pool of available suppliers keeps product specialization at a moderate level, which also benefits buyers. Finally, low supply chain risk ensures that buyers will not experience a shortage in supply or disrupted services.
Unfortunately for buyers, interior design prices have been rising at an estimated annualized rate of 2.3% during the past three years. Strong price growth during the period largely resulted from increasing demand as the economy returned to growth and facilitated a surge in construction activity, says Outlaw. With the economy on the mend, corporate profit rose and the number of businesses increased, all of which contributed to strong demand for interior design services. In light of stronger demand, suppliers increased their prices, which has hurt buyer power. Furthermore, the low availability of substitute services also undermines buyer power. Buyers can develop an in-house design team, but those employees can lack crucial knowledge of design services, such as adhering to building codes and regulations.
In spite of rising prices, price volatility has been low and is expected to remain low during the next three-year period. Low price volatility allows buyers to confidently secure their interior design services without fear of prices rising unexpectedly. However, prices are forecast to rise at an average annual rate of 2.8% in the three years to 2017, and buyers are encouraged to secure their interior design services now rather than later. For more information, visit IBISWorld’s Interior Design Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist the buyers of interior design services. Providers of these services take building codes, health and safety regulations, traffic patterns, floor planning, mechanical and electrical needs, as well as interior fittings and furniture into consideration to design and run projects in interior spaces for clients. This report focuses on interior design for commercial buildings, rather than residential homes.
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.