The average price of chillers is forecast to continue rising in the three years to 2018 as suppliers' production costs increase and demand continues to rise
Los Angeles, California (PRWEB) March 15, 2015
Chillers have a buyer power score of 3.3 out of 5, indicating that buyers have a moderate level of negotiation power due to the market's large number of suppliers, the product's widespread availability and the price-competitive nature of the market. According to IBISWorld market research analyst, Jordan Weinstein, "there are about 1,550 chiller vendors, so buyers have a large number of capable suppliers to satisfy their needs." However, recent demand growth and price fluctuations for key inputs have slightly reduced buyer power.
As the economy has improved in the three years to 2015, the price of chillers has increased due to an upswing in demand from the construction and industrial sectors. "The recovering economy will also lead to stronger demand from other key buyers, such as those in the residential construction industry, in the years to come," says Weinstein. Suppliers are also expected to see a rise in their input costs, such as the costs of steel, aluminum and plastic, during the three years to 2018. Consequently, the price for chillers will increase as suppliers pass off a portion of their higher input costs to buyers.
Despite the rise in demand and input costs for chillers, these trends will not lead to substantial price growth in the next three years. This is largely due to the market's significant number of suppliers, low switching costs and the moderate level of available substitutes, which strengthen competition. Due to pricing pressure from heavy competition, suppliers that drastically increase price will lose business to vendors offering the same standardized chillers at a lower price. In addition, the low degree of specialization for chillers means that a wide variety of suppliers are capable of satisfying specific buyer requirements. Major vendors in the market include Ingersoll Rand, Johnson Controls, Elkay and Lennox International. These conditions are favorable for buyers and are expected to remain unchanged in the next three years. For more information, visit IBISWorld’s Chillers procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of chillers. Chillers are used to remove heat from a liquid, which can then be circulated through a thermal device to cool air. This air is then distributed to machinery or throughout a room, building or structure. Chillers are typically used in conjunction with other heating, ventilation and air conditioning (HVAC) equipment to create a system to cool and circulate air. This report will focus on portable, air-cooled and water-cooled chillers and excludes heat pumps, heat exchangers and air conditioning units.
Executive Summary
Pricing Environment
Price Fundamentals
Benchmark Price
Pricing Model
Price Drivers
Recent Price Trend
Price Forecast
Product Characteristics
Product Life Cycle
Total Cost of Ownership
Product Specialization
Substitute Goods
Regulation
Quality Control
Supply Chain & Vendors
Supply Chain Dynamics
Supply Chain Risk
Imports
Competitive Environment
Market Share Concentration
Market Profitability
Switching Costs
Purchasing Process
Buying Basics
Buying Lead Time
Selection Process
Key RFP Elements
Negotiation Questions
Buyer Power Factors
Key Statistics
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.