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Electronics Production | December 15, 2010

Component shortages force manufacturers to re-assess kitting strategy

Paragon Electronic Components. has recorded a rise in demand for its supply chain management expertise, a trend which it attributes directly to ongoing component shortages.
With typical lead times spiralling from an average of eight to ten weeks, to nearer twenty and longer, the current climate has also led to an increase of counterfeit components in the market.

The reasons for rising component lead times are varied, with many industry observers pointing to the fact that component manufacturers cut capacity last year before being caught out by a resurging demand that was stronger than anticipated.

Paragon’s Director of Purchasing, Murray Dilks, explains: “Regardless of the reason for component shortages, it’s clear they are causing major problems for today’s manufacturers. Indeed, unless manufacturers partner with supply chain specialists such as ourselves, they are faced with the prospect of shopping around. Many are forced to venture out into the grey market where it’s not always easy to ascertain the provenance of the part. This situation is forcing many to re-assess their approach to kitting; there has never been a better time to do this.”

With a proven component management service in place, manufacturers are able to protect their production schedule from the uncertainties of the electronic components marketplace.

Mr Murray adds: “We rarely pass extensive component lead times on to our customers, because our people are experienced and resourceful enough to find alternative routes – just one of the benefits of our extensive global network of supply chain partners. Our team know these markets inside out, so they know where to go to get the best for our customers in these trying times. We also have strict controls and robust processes in place to ensure that we avoid, and if necessary detect, counterfeit product.”

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