Note Windsor’s logistics manager, Brendon Jones, explains how trustworthy partnerships with customers are helping overcome challenging market conditions
It was a relief when many of the UK’s covid restrictions were lifted and scaled back in much of Europe, bringing anticipation of an improvement in the supply chain. Despite this positive move, it is worth being mindful of the restrictions and lockdowns still operating in many parts of the Far East and their lasting impact from factory capacities to shipping availability. These factors cloud some of the positivity.
Coupled with this, are ongoing component shortages driven by phenomenal growth in 5G, cloud computing, infotainment and consumer electronics markets. The continuing global trend toward miniaturisation and digitalisation during the pandemic has increased demand. This applies to component manufacturers across all industries including consumer electronics, electric vehicles, healthcare and energy production. Events in Ukraine and Russia have compounded the issue limiting supplies of raw materials in an already constrained world. This has created further factors that need careful consideration when planning effective fulfilment in the challenged supply chain.
As the electronics industry progresses , supply and logistics are currently the biggest challenges for contract electronics manufacturers meeting customer requirements. To a degree, Note has mitigated some of these challenges through its proven Kanban model and more recently an increase in inventory to ensure component availability.
The first point at which these conditions are felt is component procurement. In essence, Note’s ability to procure in an effective and timely manner is paramount. In many projects, the 80/20 rule applies. Roughly 80 per cent of components are readily available and can be sourced relatively easily, while the remainder need further work to source from trusted and approved sources. It is those last few components that dictate when the project enters the manufacturing stage, so planning is crucial.
As the component market is so volatile, delays can occur at any stage of the sourcing process. Depending on when it occurs often determines how it is mitigated. While the market is unpredictable, there are many options using Note Windsor’s local sourcing team or the central sourcing team within the wider Note group to bring leverage to procurements.
If a supply delay only impacts schedules by a few days or maybe weeks, robust planning programs can often accommodate this. Occasionally the delay does not occur until quite late in the planning process meaning materials may already have been kitted in preparation for assembly, pending a last item. A key to avoiding this is looking at the BoM early to ensure a good grasp on lead times and order ahead of time.
If there are last minute BoM changes from the customer, we can work with them to look at component availability and cost using our internal software which analyses lead times, obsolescence and BoM cost.
In these unusual times it is the partnerships and relationships of trust we have fostered with customers and suppliers, that help overcome challenging market conditions.
Customers are being asked to forward plan as far in advance as possible to mitigate global lead-times. Customers understand this and are supporting us by providing the same to ensure we can manage challenges that lay ahead together.