6 Strategies to Mitigate Lead Time and Cost Increases in Surging Electronics Market

March 12, 2021
strategies-to-mitigate-lead-time-and-cost-increases-in-surging-electronics-market-1280x854.jpg

Supply chain disruptions are being reported in the electronics component market due to current demand for components in various applications such as smart devices, automotive, IoT, medical devices, unmanned devices and others. Our suppliers and market watch sources are reporting supply chain disruptions including shortages and cost increases. We asked our lead supply chain analyst, Ross Bilodeau to give our customers advice on how to manage these supply chain disruptions within the PCBA market. He advises that “In a global economy, these types of changes happen almost in real-time and having a strategically reasonable plan is key for large and small businesses to pivot quickly and navigate successfully through an inclement market.”

Bilodeau offers the following 6 strategies to incorporate and take control of your supply chain in every type of market landscape, especially one in high-demand like we are experiencing today.

1. Order Placement Strategy

It may seem counterintuitive to order smaller batches more frequently rather than ordering one large batch, but often times our customers are able to save money this way. A good partner can help you with a cost analysis to determine if this method could be helpful to your bottom line in any market. This is usually based upon component specifics.

2. Consider Supplier Location

Lead time for stateside suppliers can often be shorter than their foreign counterparts. Mainly due to the actual shipping time, which is can be several weeks or more, depending on the circumstance of external occurrences. Furthermore, using a trusted supplier and contract manufacturer is paramount when it comes to avoiding and managing supply chain disruptions.

3. Commit to Transparency in Sales Forecasts

The fulfillment process is always at peak performance when there is two-way communication in place with your suppliers. Sharing your sales forecast can act as a road map and help your trusted supplier plan ahead to ensure your product is ready to ship when you need it. This is also necessary when specific raw materials are required, along with value-add and logistic needs within your end product.

4. Standardize Design

Using standard components in your design can save both money and time for your engineers and downstream in the production process. If you require custom component capabilities, use a trusted contract manufacturer to effectively manage prototyping and testing. Working alongside supply chain will strengthen the knowledge base of overall success of your design as well.

5. Look for Value Added Services

Some manufacturers and suppliers offer services like BOM conditioning and continuous monitoring which focus on detecting issues early and providing solutions proactively to avoid supply chain disruptions. This essential value add service can predict problems and help manage your time to market.

6. Vet Your Supplier

The last strategy is easy. Make sure you are using contract manufacturers and suppliers that are accredited and incorporate quality assurance procedures, including open communication and documentation protocols. This will increase the likelihood for a long-term solid partnership that will provide on time and on budget products. Strong relationships prove to be key, time over time.

Pro-Active Engineering, located near Madison, Wisconsin has been providing professional electronic design, quick-turn prototyping, PCB layout, board assembly, and box build assembly services for a wide range of industries including energy systems, industrial equipment, military/defense, medical devices, underwater autonomous vehicles (UAV) and scientific/research equipment for 25 years. Reach out to our experts today to learn how we can Pro-Actively serve you.

Contact


Mon – Fri 8.00AM – 4.30PM

(+1) 608-837-7838

sales@proactivepcb.com

Address



Pro-Active Engineering350 Business Park Dr, Sun Prairie, WI 53590

Media

Stay up-to-date with the latest at Pro-Active Engineering – follow us on social media!