The AOP Key Price Drivers is a new content offering created in partnership with ProcurementIQ that looks at the direction of the primary price drivers of a product or service and how they combine to influence buying decisions.
Today we are reviewing electric wire.
Electrical wiring, also referred to as building wiring, is used to provide power to buildings and structures. The key buyers include residential and nonresidential developers, utility companies, telecom companies and more.
Although this type of wire is made of several materials, copper represents over a third – 34.7% – of input material costs. World prices for copper have increased sharply since 2020, increasing from $157 per 1,000 ft of wide to $197 in 2022. Fortunately for buyers, the market is expected to level off over the next three years, with prices staying high but level at just under $200 per $1,000 feet.
How to Use this Information
There are few substitutes for electric wire, even though there is very little customization or specialization. Fortunately for procurement, switching costs are low, meaning that it is usually possible to switch suppliers with little impact to the business. Another consideration is labor efficiency; less waste may save the business money that finding a skilled installer – even one that costs more than average – makes a difference.
We have partnered with ProcurementIQ to dig into their treasure trove of over 1,000 indirect category intelligence reports, with new insights every Friday. To dig deeper into the electrical wire category, click here.