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Reducing costs through supplier engagement

VISIT GELEC AT STAND 35 – Electronic Component Show 2024

As relative stability returns to the electronics industry, Gelec encourages buyers to engage with their suppliers to fully understand the depth and breadth of their service offering.

As Gelec prepares to return to the Kassam Stadium for ECS, there is one phrase it hears repeatedly from clients and prospects—relative stability. Since last October, disruption in the Middle East and continuation of the Ukraine War has meant instability and uncertainty for everyone in the electronic components industry, characterised by: lead times that extend at a moment’s notice; uncertainty of when or if stock will arrive; and an inability to plan production schedules.

To keep production lines moving, many located stock from outside their approved supply chain, often at inflated prices. With stock secured by competitors at a moments’ notice, supplier qualification procedures were abandoned. This prolonged period of turbulence has left a legacy of bloated vendor bases and over-complicated supply chains.

The good news is the industry is entering a period of relative stability. It’s now time to sit and review things. It’s time to identify efficiency savings, including supplier consolidation or vendor reduction.

Managing fewer suppliers and operating efficiently typically results in savings. Communicating with fewer vendors can allow for deeper discussions about forward planning, optimising manufacturing batch sizes, introducing supply agreements and simply ensuring parts are available when and wherever needed. Gelec’s recommendation: engage with suppliers and find out more about them. It’s likely they offer more than you realise.

As relative stability returns to the electronics industry, Gelec encourages buyers to engage with their suppliers to fully understand the depth and breadth of their service offering