Declining or stagnant input costs and rising demand are pushing the price of truck maintenance and repair services upward; recent volatility in the market is producing a slightly risky buying environment
Los Angeles, CA (PRWEB) March 25, 2015
Truck maintenance and repair services have a buyer power score of 3.4 out of 5. This score indicates that buyers have an advantage over suppliers with regard to negotiations and pricing power. Buyers benefit from low market share concentration among suppliers in the market and low switching costs, as well as slow and steady price growth. However, buyers contend with numerous risks when purchasing truck maintenance and repair, including inconsistent billing methods among suppliers and a lack of substitutes.
“Thousands of suppliers vie for market share in the $25.9 billion per year truck maintenance and repair market. The abundance of suppliers benefits buyers by allowing them to compare prices in their local area and pit competing suppliers against each other in negotiations,” according to IBISWorld business research analyst Scott Winters. Additionally, prices are increasing slowly and steadily, with rising parts and material prices and steady demand representing spurring price expansion. Low switching costs can also be used to obtain lower prices or switch suppliers as needed, further boosting buyer power.
There is also an array of factors reducing buyer power. “The limited size and scope of most suppliers can be inconvenient and costly for buyers with large operations in multiple states, requiring added lead time for the procurement process,” Winters says. Some of this market’s most prominent suppliers include The Pep Boys, Bridgestone Corporation, Rush Enterprises and ArcBest Corporation. The lack of substitute options also hurts buyer power because buyers often have no other choice but to purchase these services. An increasing price trend places pressure on buyers to purchase the services now and may prompt buyers to rush into a purchase without conducting adequate research, which is extremely important when procuring truck repairs. Lastly, the time and material pricing model poses a high risk for buyers because an increase in the price of parts is directly incorporated into repair prices. Fortunately for buyers, these risks can be managed with diligent research and preparation, typically resulting in a fair price and excellent value for buyers. For more information, visit IBISWorld’s Truck Maintenance & Repair procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of truck maintenance and repair services. Aftermarket maintenance and repair services range in complexity from visual inspections and minor repairs to full mechanical overhauls. These services are provided by small specialized repair shops and some large chains. Repairs are commonly performed at the supplier's place of business or a travel center, but many suppliers also offer mobile repair and maintenance. This report focuses primarily on services for commercial trucks and excludes services provided by truck dealerships. This report does not cover the purchase of new trucks or trailers, nor does it address any services related to passenger cars or SUVs.
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.