Economic Factors and Their Impact on Mechanical, Electrical, and Plumbing Services Procurement

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Mechanical, Electrical, and Plumbing Services Category Overview

The global mechanical, electrical, and plumbing services (MEP) category is anticipated to grow at a CAGR of 11.58% from 2023 to 2030. Key drivers that fuel the growth of global category include rise of construction sector due to rapid urbanization, increasing focus on energy efficiency and sustainability of buildings, need for developed economies to improve their current infrastructure and the growing infrastructure development in emerging economies, and stringent building regulations. However, growth of the category can be hindered by factors such as high costs, workforce shortages, complicated regulatory compliance, and a sluggish uptake of new technology. Implementation of services offered in the category can be expensive, which acts as a challenge for projects with tight budgets. In addition, lack of labor can raise expenses and cause project deadlines to slip. Furthermore, complying with intricate regulatory requirements might make it difficult to adhere to local building laws and standards.

 

Order your copy of the Mechanical, Electrical, and Plumbing Services Procurement Intelligence Report, 2023 – 2030, published by Grand View Research, to get more details regarding day one, quick wins, portfolio analysis, key negotiation strategies of key suppliers, and low-cost/best-cost sourcing analysis

 

Technologies that driving the global category include digitalization, building information modelling (BIM), smart buildings, and artificial intelligence (AI).The global category is witnessing revolutionary transformation as a result of digitization and the increasing adoption of BIM.The planning, designing, executing, and managing services offered in the category over the course of a building’s lifecycle is being completely transformed by these trends.Specifically, BIM has become a vital component of contemporary MEP operations. It makes it possible to create comprehensive 3D digital models of a building that include all MEP systems and components.These models are extremely helpful, not only for design and visualization but also for facilitating coordination and cooperation between different stakeholders, such as facility managers, contractors, engineers, and architects. BIM improves precision and lowers mistakes in MEP coordination and design.

 

Mechanical, Electrical, and Plumbing Services Procurement Intelligence Report Scope

The Mechanical, Electrical, and Plumbing Services category is expected to have pricing growth outlook of 10% – 15% (annual) from 2023 to 2030, with below pricing models.

  • Cost-plus pricing
  • Fixed pricing

 

Supplier Selection Scope

  • Cost and Pricing
  • Past Engagements
  • Productivity
  • Geographical Presence

 

Supplier Selection Criteria

  • Industries Served
  • Years In Service
  • Geographic Service Provision
  • Certifications
  • Types Of Services
  • Technological Solutions On Offer
  • Project Management
  • Maintenance Services
  • Technical Support
  • Regulatory Compliance
  • Others

 

Other Post You May Be Interested In

Request for Sample Copy of the Mechanical, Electrical, and Plumbing Services Procurement Intelligence Report, 2023 – 2030 (Revenue Forecast, Supplier Ranking & Matrix, Emerging Technologies, Pricing Models, Cost Structure, Engagement & Operating Model, Competitive Landscape)

 

Mechanical, Electrical, and Plumbing Services Procurement Intelligence Report Coverage

Grand View Research will cover the following aspects in the report:

  • Market Intelligence along with emerging technology and regulatory landscape
  • Market estimates and forecasts from 2023 to 2030
  • Growth opportunities, trends, and driver analysis
  • Supply chain analysis, supplier analysis with supplier ranking and positioning matrix, supplier’s recent developments
  • Porter’s 5 forces
  • Pricing and cost analysis, price trends, commodity price forecasting, cost structures, pricing model analysis, supply and demand analysis
  • Engagement and operating models, KPI, and SLA elements
  • LCC/BCC analysis and negotiation strategies
  • Peer benchmarking and product analysis
  • Market report in PDF, Excel, and PPT and online dashboard versions

 

Mechanical, Electrical, and Plumbing Procurement Cost and Supplier Intelligence

The category for mechanical, electrical, and plumbing services is moderately fragmented, with the presence of global and regional players in the industry. It is witnessing the entrance of various facility management service providers with an objective to enable themselves offering their clients a full portfolio that includes not only facility management components but also the functionalities that are offered by MEP service providers as well. Over the coming years, it is anticipated that the main strategies used by industry participants to increase their market share will continue to be establishing long-term collaborations with the key players in the construction sector, service contract acquisitions, and mergers and acquisitions. Considering the current global economic conditions, the bargaining power of supplier stays low to medium. The bidding processes for suppliers and contractors are extremely competitive given the current state of the economy and the challenges that the industry is currently facing.

 

Labor costs, cost of materials & supplies, energy cost, and government taxes are the key cost components in this category. Wages paid to the labor constitutes 35% – 40% of overall expenses. Labor costs are rising due to fierce competition for workers, particularly in certain low-barrier-to-entry positions. Although the wages for the services offered in the category has witnessed moderate increase, however, sustaining the existing workforce is challenging due to required training and skills. Majority of sectors in the economy, including mechanical, electrical, and plumbing services, are being impacted by the labor shortage. In light of the present labor scarcity, firms are raising wages, benefits, and incentives in an effort to attract and retain workers. The cost of materials has also increased significantly since the outbreak of COVID-19 pandemic. The labor shortage that has caused supply chain disruptions is largely to blame for the fact that demand for some commodities has surpassed manufacturers’ capacity to produce and distribute supplies.

 

Asia-Pacific region dominates the global mechanical, electrical, and plumbing services category, holding substantial share in the global category. Growth of the category in the region can be attributed to several infrastructure-related projects in the nations such as India, China, and Indonesia. In addition, expanding array of commercial activities in these nations, which include manufacturing, multichannel retail, and the IT product and service sector, will offer significant growth opportunities over the projected timeframe. Furthermore, the region’s adoption of green MEP services has been fuelled by growing awareness of sustainability and energy efficiency. Assessing if the service provider covers comprehensive range of services, evaluating the technological capabilities of a service provider, ensuring that the service provider is flexible enough and can adapt to the project’s specific need, and considering the value offered a respective service provider based on the price considers some of the best sourcing practices in this category.

 

Key Companies Profiled:

AECOM, AtkinsRéalis, Bowman Consulting Group, Ltd.,Dohn Engineering PLC,EMCOR Group, Inc., Enventure Engineering LLP,ETA Engineering Pvt Ltd.,HDR, Inc.,Jacobs Solutions Inc.,Knight FM,Meinhardt Group, andWSP Global Inc.

 

Brief about Pipeline by Grand View Research:

A smart and effective supply chain is essential for growth in any organization. Pipeline division at Grand View Research provides detailed insights on every aspect of supply chain, which helps in efficient procurement decisions.

 

Our services include (not limited to):

  • Market Intelligence involving – market size and forecast, growth factors, and driving trends
  • Price and Cost Intelligence – pricing models adopted for the category, total cost of ownerships
  • Supplier Intelligence – rich insight on supplier landscape, and identifies suppliers who are dominating, emerging, lounging, and specializing
  • Sourcing / Procurement Intelligence – best practices followed in the industry, identifying standard KPIs and SLAs, peer analysis, negotiation strategies to be utilized with the suppliers, and best suited countries for sourcing to minimize supply chain disruptions
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