Increasing demand due to the ongoing aftermath of the 2010 Deepwater Horizon oil spill in the Gulf of Mexico and a rise in rail accidents have been pushing prices up
Los Angeles, CA (PRWEB) December 27, 2014
Oil spill cleanup services have a buyer power score of 2.8 out of 5, which reflects current pricing trends and a moderate amount of bargaining power. In recent years, oil spill cleanup services have been in high demand, primarily due to the repercussions of the 2010 Deepwater Horizon oil spill in the Gulf of Mexico and a rise in rail incidents, says IBISWorld analyst Deonta Smith. Although additional oil from the 2010 Deepwater Horizon oil spill is reportedly no longer entering the environment, habitat remediation efforts are still underway and are expected to continue in the coming years. These disasters, among others, have heightened demand and subsequently led to higher prices for oil spill cleanup services during the recent period, thus negatively impacting buyer power.
Additionally, the lack of viable service substitutes and moderate level of supply chain risk have reduced buyer power, continues Smith. The low level of substitutes limits buyer options to the certified and licensed operators in the market, and the price volatility of crucial input materials might incur sudden price spikes that are passed on to the buyer in the form of higher prices. Buyers are encouraged to secure longer-term contracts to secure lower prices.
Despite these disadvantages, prices during the next three years are forecast to decelerate, allowing buyers more negotiating power when arranging agreements with potential suppliers. From 2014 to 2017, the number of oil spill emergencies is expected wane due to the advancements of oil handling procedures and increased demand for oil alternative fuel sources. As a result, demand for oil spill cleanup services will increase at a slower pace during the next three years.
Another benefit to buyers is the market's low level of concentration and switching costs. Low market share concentration fosters an environment where there are ample vendor choices for the buyer, including Veolia Environnement SA, CB&I and Clean Harbors Inc., and competitive prices among bidders. Moreover, buyers benefit significantly from the ability to switch service providers if budgetary and quality criteria are not being met. For more information, visit IBISWorld’s Oil Spill Cleanup Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of oil spill cleanup services. Oil spill cleanup services provide initial spill investigations, oil residue disposal or control services as well as oil spill treatment services. Operators in this market do not typically specialize in habitat remediation and environmental consulting but can offer these related services after the oil spill cleanup services have been rendered to contract specifications. This report excludes materials recovery 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
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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.