Electronic Components Industry Overview
The electronic components industry in the UK is undergoing a major set of challenges, ahead of global economic malaise and geopolitical issues. Procurement departments are finding it difficult to address problems such as inaccurate forecasts, sourcing constraints, supplier consolidation, pricing fluctuations, inventory management problems. Optimizing supply chain amid such challenges coupled with supply shortages and overages are further increasing complexities. This is compelling companies to collaborate with firms such as SpendEdge to gain insights to address supply chain risks, supply shortages, pricing complexities, and supplier issues.
Business Challenges Faced
The client, one of the leading companies in the electronic components industry in the UK very well realized the importance of an efficient and flexible supply chain to improve their operations. However, their ongoing efforts to optimize the efficiency of their supply chain were causing supply disruptions and proving to be expensive. The process was getting time-consuming and resource-intensive than expected due to which certain suppliers were planning to discontinue their services. Apart from this, component shortages, excess supply, risks related to the terms of their contracts with suppliers were major risks impacting the market position of the client.
Inability to build an agile supply chain can impact the ROI and market position of companies in the electronic components industry. Request a free proposal to access our tailor-made solutions.
Our Research Approach
To help the client better prepare for shortages and improve supply chain operations, the experts at SpendEdge carried out a detailed electronic components industry analysis. They created an accurate forecast based on the sales data and developed a supply chain strategy that focused on lead times. The insights offered enabled the client to differentiate order lead times from replenishment lead times and minimize unnecessary buffers in the supply chain.
Moreover, the solution offered focused on building strong relationships with suppliers. They identified suppliers who could provide a greater percentage of their output to the client in the allocation method. Also, they provided the solution that empowered the client to move away from single-sourced parts and rapidly select alternative qualified suppliers that could keep their products on schedule.
SpendEdge’s detailed electronic components industry report helped the client to create a global pricing agreement with component suppliers and ensure the supply of electronic components at lower prices. Also, the insights offered helped the client to build a supply chain process that could plan for long delays of components. The solution offered further reduced the lead time from 20 weeks to 12 weeks on some basic parts.
Gaining accurate market insights and engaging with potential suppliers is crucial for companies in the electronic components industry to address supply chain issues. Request a free demo to access our web-based procurement platform and gain detailed insights.
Procurement Best Practices in the Electronic Components Industry
- Aim for a preferred supplier agreement at full annual volumes with SLAs to ensure consistent supply.
- Gather all the necessary information such as supplier and manufacturer names, part numbers, descriptions, pricing, and historic annual volumes.
- Determine desired stock levels against blanket orders and release schedules.
To know in detail about the ways to procure components and address supply shortages in the electronic components industry, request more information for our experts.