Increasing demand and market consolidation will result in circuit board prices rising in the three years to 2017
Los Angeles, CA (PRWEB) February 05, 2015
Bare printed circuit boards have a buyer power score of 3.4 out of 5. This score indicates that neither buyers nor suppliers have a significant edge during price negotiations. “Mixed negotiating conditions are the result of accelerating price increases and a variety of factors that benefit and hamper buyer power, including low supply chain risk and moderate financial instability among vendors,” says IBISWorld procurement analyst Andrew Krabeepetcharat.
Price trends have been stable in the three years to 2014. Rising consumer spending, IT investments and internet traffic have resulted in higher demand for bare printed circuit boards used in many applications, including consumer electronics, computer and IT hardware and telecommunications networks and equipment. Price increases have, however, been moderated by low market share concentration and the commoditization of circuit boards, both of which have boosted price-based competition and pressured suppliers to keep prices low. Unfortunately, price growth is expected to accelerate in the three years to 2017 as demand for circuit boards rises further. “In addition, suppliers' input costs will not decline as quickly as they have during the past three years, contributing to faster price growth during the forecast period,” adds Krabeepetcharat.
There are some market factors that have benefited buyers. Circuit boards are commoditized, and product offerings are similar across different suppliers. Low market concentration, meanwhile, indicates that buyers have access to many suppliers and that no one supplier has too much control over prices in the market. Furthermore, switching costs are also low, enabling buyers to negotiate lower prices by leveraging their ability to change suppliers.
Buyers also benefit from the market's low supply chain risk. Supply chain risk is low, indicating that suppliers have ready access to the raw materials required to manufacture circuit boards. As such, buyers should not have trouble procuring a stable supply of the products. However, some suppliers have unstable financial structures, putting them at risk for bankruptcy. Buyers may have their supply disrupted if their supplier goes out of business. For more information, visit IBISWorld’s Bare Printed Circuit Boards procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to help buyers of bare printed circuit boards, often referred to as simply circuit boards. Circuit boards support and connect electronic components and are used in almost all electronic devices and products. They are, therefore, an essential input for companies that produce electronic products. This report excludes circuit board services such as circuit board assembly and product testing and development.
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.