Price of engineering testing services have increased primarily due to rising R&D expenditures
Los Angeles, CA (PRWEB) March 31, 2015
Engineering testing services have a buyer power score of 3.4 out of 5. This score indicates moderate negotiating power for the buyer. According to IBISWorld research analyst Daniel Krohn, buyers benefit from high market fragmentation, low supply chain risks, low vendor financial risks and low price volatility. Nonetheless, high product specialization, moderate switching costs and growing demand hinder buyer power somewhat.
Engineering testing firms provide services across several industries, which reduces supply chain risk and stabilizes demand. In turn, stable demand helps suppliers maintain consistent pricing strategies. “The resulting low price volatility promotes a stable purchasing environment for buyers by allowing them to accurately budget and evaluate prices,” says Krohn. Moreover, the diversification of services across several markets has led to low vendor financial risk. As such, buyers can expect to be secure in negotiating long-term engineering testing contracts in the three years through 2018. Current vendors include Bureau Veritas Group, Intertek Group, National Technical Systems Inc. and SGS.
Buyers also benefit from high fragmentation within the market, which encourages price-based competition among vendors. However, due to high geographic barriers, most buyers have access to a small fraction of the total vendors in the market. Therefore, vendors are able to charge premium prices for their services, particularly during periods of high demand. Due to the continuing need to comply with government regulations and a low availability of substitutes, demand is generally high and buyer power is somewhat restricted. For more information, visit IBISWorld’s Engineering Testing Services procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of engineering testing services. Engineering services include the analysis of physical, chemical and mechanical properties; rotating machinery and vibration; structural modeling, qualification testing and noise mitigation; nondestructive, geotechnical, thermal, calibration, electrical and electronic testing, among others. These services can be performed on-site or in a laboratory. This report excludes other forms of laboratory testing, such as medical and veterinary testing.
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.