While we are starting to see some easing in electronic components supply chains in 2023, the potential for disruption continues.
Global supply chain risks remain high.
S&P Global supply chain risk assessment reports continued concern over global supply chain risks, especially with rising geopolitical tensions. Even as port congestion and shipping capacity edge closer to pre-pandemic norms, there are continuing hurdles to overcome. For example, even as transportation and logistics are continuing to increase, no new U.S. port capacity is being created.
That’s just about transporting electronic components, however. There are also continuing concerns about material supplies, the manufacture of parts, and the role inflation plays in supply chain management risks.
Benefits of Adopting Supply Chain Risk Management
Reducing the risk of supply chain disruptions must be a top priority for OEMs. Here are some of the top benefits.
Earlier Detection of Threats
If manufacturers had been able to foresee the supply chain problems over the past couple of years, they might have been able to take earlier action to protect themselves from shortages. Early detection and a proactive strategy can help mitigate future threats.
The earlier you can detect warning signs for disruption, the sooner you can act.
More Agile Operations
Active supply chain risk management allows you to adapt. When you know what risks can prevent you from getting the electronic components you need and the impact of delays on product delivery, you can shift resources. For example, diversifying your sourcing or working with an independent distributor that has deep connections with alternative sources.
Avoid Counterfeit Parts
In the rush to fulfill orders, you may be working with different suppliers. The need to ensure genuine electronic components that perform as promised increases. By reducing supply chain risk, you also reduce the potential for getting counterfeit parts.
Increased Customer Satisfaction
When you can’t deliver products on time, you have unhappy customers regardless of how hard you work to overcome supply chain disruption.
Protect Your Brand
Just as you depend on your suppliers to get you the electronic components you need, your customers depend on you to get them finished products. When you fail to do so, even through no fault of your own, it can damage your brand and hurt potential re-orders.
Reduced Need for Overstocking
When there’s concern about getting the electronic components you need, there’s often a tendency to bulk up orders just in case there’s a problem in the future. This ties up capital in inventory that may wind up being excess or obsolete. Solid electronic component supply chains can avoid this.
Avoid Rush Charges or Hefty Shipping Costs
Reducing risk also helps minimize the need for rush charges or significant increases in shipping costs. For example, as many manufacturers struggled to get components out of Asia due to port congestion, many turned to air freight at a cost of 5X or greater.
Protect Your Cash Flow
Ultimately, mitigating global supply chain risk for components can protect your cash flow. You can right-size your inventory, manufacture and deliver products on time, keep your customers happy, improve business continuity, and maintain margins.
Supply Chain Risk Management Strategies for Electronic Components
The benefits of adopting supply chain risk management are clear. Even if manufacturers today are seeing a bright future when it comes to sourcing electronic components, they should take proactive steps to prevent supply chain disruptions in the future.
One of the best strategies for supply chain risk mitigation is to diversify your sources. Yet, finding and working with scores of individual suppliers and vetting them can be challenging — especially when you are in crisis mode because you can’t get the components you need from your regular suppliers.
Working with an independent distributor you trust provides you with the diversity of sources you need to create a more resilient supply chain while also enabling you to consolidate your vendor relationships for efficiency. This makes managing the supply chain, and the risk, simpler. This reduces the number of vendors and platforms you have to hunt down and learn the nuances of how they work.
Unlike brokers that work on a just-in-time (JIT) delivery to connect you with suppliers when you are ready to place an order, an independent distributor often has the part in stock and ready for delivery.
Finding Suppliers You Can Trust
There’s another significant advantage to working with an independent distributor like Sensible Micro. Sensible Micro has deep relationships with global suppliers of electronics components. When you need to turn to alternate sources for components, you’re trusting them to deliver quality parts on time. If you haven’t worked with them before, you don’t really know whether they will do what they say they will and provide genuine parts.
Sensible Micro provides partners with access to one of the most technically-advanced inspection labs in the industry for validation, including the 72-point IDEA-SD-1010 B visual confirmation, high-powered microscopy, and marking permanency tests on every order. Your General Counterfeit Avoidance Test (GCAT) plan can also be customized for a wide range of tests.
Because of pre-established relationships and a track record with alternate suppliers, Sensible Micro knows how you can trust and provide the testing you need for quality assurance. You can leverage this experience to make better decisions.
Earlier Alerts for Potential Disruption and Opportunities
These relationships also provide an earlier warning when there are potential disruptions on the horizon. You also get more reliable and timely information about Last Time Buy (LTB) notices, End of Life Announcements (EOLA), and surplus stock releases. This can provide a significant competitive advantage by allowing you to act more quickly.
Reducing Supply Chain Risk and Improving Efficiency
While you can’t totally eliminate supply chain risk, you can take steps to mitigate your exposure. We can help. Working with Sensible Micro enables you to get the benefits of vendor consolidation while leveraging a wider, more diverse range of suppliers for a more resilient supply chain. You get access to vetted suppliers for authorized, factory-direct, and independent electronic components from high-quality providers.
Contact us today and let us show you how we can reduce your supply chain risk.