Calibration services market on the rise
Jessy Cavazos, Frost & Sullivan Industry Director, Measurement & Instrumentation Practice- May 15, 2012
Factors expected to have a high impact on market growth over the forecast period include the stricter compliance environment and increased competition in key end-user industries, increasing the focus of customers on quality and their core competencies. With the outsourcing of manufacturing activities overseas during the past decade, the market shares within the calibration service market of the aerospace and defense and the medical industries have grown, while the shares of electronics manufacturing, industrial, and automotive industries have suffered. Moving forward, research indicates revenue potential potential in the medical and energy industries due to an increased demand for calibration services within these trades.
The growth in installed base of test and measurement equipment, as well as the increasing complexity of such equipment, will also have a positive influence on the market growth for calibration services. Suppliers of calibration services should beware, however, of the growth of modular instrumentation. Modular instrumentation has reached a significant share of the total general-purpose test equipment market in North America and is expected to make further inroads over the forecast period. Most suppliers of calibration services focus on providing calibration services for traditional instruments, but the instrumentation market is shifting to modular, and customers can calibrate modular instruments more easily than they could calibrate traditional instruments.
As the mix of products at customer locations has become more heterogeneous, the demand for calibration services for various types of equipment, including electrical, mechanical, dimensional, and physical, at one location is expected to further increase over the forecast period. Companies are striving to increase their capabilities both organically and through partnerships and acquisitions.
Another challenge for most of the calibration services market is the globalization of customers and the growing demand for a single global service provider. Calibration services companies are striving to expand their global footprint to cater to this emerging demand.
At the same time, price pressure from the multitude of niche participants in the market, the overall macro-economic conditions, and decreasing defense budgets are expected to restrain market growth in the future. By 2018, total revenue for the calibration services market is expected to reach $1373.5 million. T&MW