Prices for patch panels are expected to marginally decrease during the next three years due to stagnating purchasing costs and high levels of competition
Los Angeles, CA (PRWEB) April 07, 2015
Patch panels have a buyer power score of 4.0 out of 5, which is indicative of favorable negotiation power for buyers in this market. “Buyers benefit from low market share concentration and recent price decreases,” according to IBISWorld business research analyst Cameron Roark. However, moderate supply chain risk and high switching costs limits buyer power.
Buyers of patch panels benefit mostly from a low level of market share concentration because it forces many vendors to compete based on features, innovation and pricing. Buyers can pin different vendors against each other to secure more favorable rates. Furthermore, buyers benefit from fairly flat price trends. “Although demand for patch panels has risen due to the growing investment in computers and a rising number of businesses, the high level of competition and stagnation of purchasing costs keep the price of patch panels in check,” says Roark.
However, not all factors favor buyer power. High levels of competition squeeze profit margins, exposing the average vendor to more financial risk. Additionally, upstream suppliers experience frequent price volatility due to the commoditized nature of their products, such as plastic; vendors that are more exposed to risks in the supply chain experience disruptions or price fluctuations that can lead to bankruptcy or price spikes. Furthermore, buyers face high switching costs because the cost of installing, removing or replacing a patch panel and integrating cables with the device can be timely and costly. Consequently, buyer negotiation power is slightly hurt because once buyers commit to a vendor, they run the risk of incurring additional costs should they look to switch suppliers. For more information, visit IBISWorld’s Patch Panels procurement category market research report page.
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IBISWorld Procurement Report Key Topics
This report is intended to assist buyers of patch panels, which are computer network devices that mechanically connect or route data packets between computer networks. Typically used in local area networks (LAN), patch panels offer multiple connector ports into a single location to organize and manage the connection of internal computers. Because patch panels are generally found in computer-intensive industries, the most predominant downstream demand markets are financial, medical and data centers. However, due to their widespread use as network infrastructure, they are used in almost every market. This report does not include wielding panels, routers, jackfields, distribution frames or wiring closets.
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.