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© A2 Global Electronics Business | April 12, 2022

From a distributors point of view – A2 Global Electronics

It wouldn't be an exaggeration to call the events of the passed two years a “perfect storm”. The ongoing consolidation among component manufacturers, coupled with trade wars and a pandemic – and all that followed – has created an environment where the ability to adapt is a must.

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 Johan Dahl, Vice President of Sales – EMEA at A2 Global Electronics + Solutions

Since the start of the pandemic the situation surrounding the supply of components have only gotten worse, how would you describe the past year in terms of operations?

“Every section of the industry was pushed to the extreme. It’s been a perfect storm — mergers and consolidation of OCMs; huge increases in global demand driven by new verticals; global restrictions and tariffs; Brexit; a global pandemic with full country and regional closures. Now, add the war in Ukraine and China’s continued lockdowns to the mix. Only the future will tell us what this means, but we’ve all learned that we must think in new ways,” Johan Dahl tells Evertiq and continues.

“You need to act fast to avoid losing out on inventory or being out-priced by a company with greater capital. If you don’t adapt, you’ll be left behind. I’d encourage all organisations to take control of and own their portion of the supply chain rather than delegate down the ladder.”

In the past, during periods of component shortages, we’ve seen an increase of counterfeit components hitting the market – what kind of measures does A2 Global have in place to catch these?

“We’ve successfully adapted to the major increase in what we refer to internally as value-add work orders, or high-reliability qualification inspections. Some people refer to this as anti-counterfeit protection, but we take it a step further by adding in vendor qualification processes. Customers in automotive, defense, aerospace, medical, and aviation — basically all the verticals within the electronics industry — have realised the importance of due diligence in qualifying independent distributors as ISO-certified has skyrocketed,” the VP of sales says.

The Vice President of Sales continues to explains that A2 Global is also well-positioned to meet that demand.

“We recently earned ISO/IEC 17025:2017 accreditation and AS6171 certification, which enables us to help customers make informed procurement decisions and maximise value while minimising risk. To answer your question, we continuously adapt to market conditions and lead our industry in testing platforms, component engineering, and investments related to quality.”

Which specific product group has been most affected by this shortage?

“It’s been coming in waves, and some product groups have been hit harder than others. If we look at the three major product groups — linear, digital, and micro — things remained quite constant throughout 2021. We didn’t see any real let-up in demand, and lead times continued to stretch to lengths that I’d consider very risky to base any sort of forecast on.”

What are your feelings about the current market situation as we enter 2022?

“The reality is that we won’t see short-term relief — at least until the late fall or early winter of 2022. Some companies have existing stockpiles, but others with fewer resources might not have that luxury and lose out on inventory to more well-capitalised competitors. We might also see consolidation, where producers prioritise high-profit product lines at the expense of legacy components. If I had a crystal ball, though, I’d say that the market will stabilise by Spring 2023 but that pockets of constraints from various manufacturers could last until 2025.” 

For 2022, what plans does A2 Global have in store to further deal with the problem at hand?

“We’ve adapted well to the demand in the market, not only in sourcing hard-to-find components but also in growing our global inspection program. Investing in colleagues, adding talent, educating valued customers, continuously increasing our ability to meet immense market demand — that’s what we are. Electronics and Solutions,” Mr. Dahl concludes.

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May 24 2022 12:51 pm V20.5.24-2