- Tags : Consulting | Procurement Consulting Services | Price trend | Price forecast | Procurement research | Category market forecast
Recent Price Trend - Procurement Consulting Services
IBISWorld estimates that the average price of procurement consulting services has been rising at an annualized rate of 2.2% in the three years to 2017 due to growth in demand. Despite price growth, buyers have been benefiting from low price volatility during the past three years. Suppliers’ primary input cost is wages, which have remained stable as a share of revenue. As a result, there has been little risk of significant input cost fluctuations, and suppliers have been able to maintain steady price trends. Low price volatility makes it easier for buyers to anticipate service prices and budget for purchases.
Growth in the number of businesses has spurred increased demand for procurement consulting services. The rising number of businesses has expanded the customer base for service providers while high, albeit slightly decreasing, corporate profit levels have allowed buyers the financial flexibility to purchase consulting services to improve their operations. In some cases, the industries hit hardest by falling oil prices and economic downturns abroad during the period have been able to turn to procurement consulting in order to gain better cost control and improve their margins.
Additionally, the IPI has grown as industrial output has increased. As businesses across many sectors have boosted production, they have required more direct and indirect materials and services to support their operations. In turn, these businesses’ procurement departments have increasingly sought out procurement consulting services to improve processes and supplement internal functions. This trend has led to demand and, thus, price growth in this market.
Price growth has, however, been tempered by the large number of suppliers operating in the market. Because buyers have many suppliers from which to choose, providers must compete on the basis of price to attract and retain business. In turn, market competition puts downward pressure on price and limits the risk of rapid price increases. Even so, as prices continue to rise mildly, buyers may wish to consider locking in service contracts now, prior to future growth.
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