From a distributors point of view – Sourceability
There are lessons to be learned from the current semiconductor situation. There are opportunities to analyse the work that has been done, the process and strategy to push forward with new solutions. Because there are signs that long-term changes to how electronic components are sourced are coming.
In this article series, Evertiq has reached out to distributors and sourcing specialists of electronic components to see just how the experts are dealing with the current semiconductor shortage and what tools they have in place to cater to the needs of their clients. This time we're talking to Jens Gamperl, CEO of Sourceability.
Since the start of the pandemic the situation surrounding the supply of components has only gotten worse, how would you describe the past year in terms of operations?
“Nobody could have predicted the level of disruption caused by COVID-19. It exposed the global supply chain’s underlying issues – shortage and price hikes – and a lack of resilience. We need to take a lesson from this situation and reset “business as usual.” When it comes to the supply chain, we now have an opportunity to evaluate processes more critically and push forward digitalization. This actionable step will help supply chains pivot and continue to work when there is a disruption like a natural or human made disaster as we’ve seen over the past several years.”
“Purchasers need to understand that without integration of technologies that allow greater flexibility to a variety of effects, as well as geographically more diversified production chains, businesses will continue to experience the downsides of the fragility of global production. Accelerating the utilization of AI technologies and beginning to reconfigure the supply chain to be more diversified – with localized manufacturing – will have significant long-term payoffs in creating a more resilient, secure global supply chain.”
In the past, during periods of component shortages, we’ve seen an increase in counterfeit components hitting the market – what kind of measures does Sourceability have in place to catch these?
“Counterfeiting is something our team is adept at identifying. In order to mitigate the open market risk, Sourceability/Sourcengine has a 3-step approach, which is now more important than ever.”
“Firstly we only add qualified and verified suppliers to our network. Ongoing objective vendor ratings allow us to utilize the best performing suppliers. Secondly, quality inspections. Our most detailed and comprehensive step, this includes XRAY, Decapsulation, RoHS Spectrometry, Solderability testing, marking permanency testing, heated solvent testing, and more. Thirdly our products and completed operations have an insurance policy coupled with a 3-year warranty to provide customers with peace of mind should any escape occur.”
Which specific product group has been the most affected by the shortage?
“While shortages are happening across the board, none is more significant than the ongoing semiconductor crunch. These chips touch nearly every type of consumer technology. But not all tech categories are created equal and, as such, the chip shortage and eventual replenishment have a rolling effect through consumer offerings – from cars to smartphones, major electronic makers, and down to smaller players in more niche markets. As the shortages continue, consumers may not have a choice but to wait to buy in the electronics, automotive, and home appliances industries.”
“Chipmakers are making efforts to provide car companies with enough microelectronics to keep their plants open. Home appliances, although not as sophisticated as other electronics, need certain components for production and the global shortage is affecting laundry machine, refrigerator, and air-conditioner production. This is hitting consumers who are buying or renovating their homes hard.”
“The reason for this? OEMs blew through their parts inventories in early 2021 to meet post-pandemic demand for consumer electronics, and chipmakers, who rely on Taiwan Semiconductor Manufacturing Company (TSMC) to fabricate their basic products, lack the capacity to replenish their warehouses.”
What are your feelings about the current market situation as we enter 2022?
“Although shortages are a common occurrence in the semiconductor industry, the present crisis is unique in its scope and duration. Some products and commodities will still have significant issues for the next six to nine months, and in some cases, the shortages will likely go into 2023. To correct the imbalance between supply and demand, industries will need to establish additional production capacity.”
“Companies should use ecommerce marketplaces, which create transparency by offering one place for all component purchases. As purchasers look outside of their traditional sourcing methods, they’ll find that marketplaces are the future of the supply chain not only due to their efficiency, but some also offer tools to manage the RFQ process and the managing Bill of Materials.”
For 2022, what plans does Sourceability have in store to further deal with the problem at hand?
“A year ago, I would have told you that we would be rebounding from these shortages by the end of 2021 and into early 2022. However, at Sourcengine we work with more than 3,000 suppliers to source more than 1 billion parts, and based on what we’re hearing in the space, the shortage isn’t coming to an end anytime soon.”
“Not only do I believe that we’ll be dealing with some of the shortages until 2023, but I also think we’ll see long-term changes to how electronic components are sourced. The devastating shortages have opened the eyes of many to the weaknesses of existing procurement and supply chain processes, and we’ve seen more interest in digital solutions, like Sourcengine.com than ever before. In fact, just this year our platform has grown more than 203% as procurement teams scramble to find ways to get products into consumers’ hands.”