A Perspective on Electronics Component Distribution Market
The global economy is constantly changing with the emerging electronic technologies and the electronic component industry is at the core of this transformation. At present, the biggest challenge faced by the electronics component distributors is the shortage of components that are affecting the global electronics supply chain adversely. The industry has been witnessing this trend for the last two years now.
If reports and analysis by industry experts are to be believed, there is a possibility that demand for electronic components will cool next year and the increasing tariffs will continue to hit the electronics supply chain. The said reports by noted analystMorry Marshallalso suggest that the semiconductor sales will decline in coming days.
Major concerns of the industry
No signs of softening
The original component manufacturers (OCMs) and electronics distributors foresee no signs of a softening market. Component makers are mulling over increasing prices due to market demand and many OCMs are still very concerned about continuing supply.
Leading semiconductor market research firm IC Insights has also predicted that the semiconductor market will witness a fall in its growth in coming days.
MLCCs tight for two more years
It will take around two more years to meet the demand for MLCCs (Multilayer Ceramic Capacitors) as interconnect, passive and electro-mechanical (IP&E) components, which account for 80% of a typical circuit board are still in short supply. The vendors of IP&E are still struggling to shrink lead times.
V5 Semiconductors suggestions for the new distributors
- The distributors must have in-depth knowledge of the products they sell as OCMs are reducing their outside sales forces so the task of educating about the components lies with the distributor.
- The new distributors need to utilize consultative selling. They need to have the knowledge to assist the designer/engineer when troubleshooting problems like inter-connectivity issues or environmental concerns.
- They must stock a wide variety of inventory.
Propelled by the overwhelmed demand for components, the electronics industry is constantly evolving and value-added distributors are having their fingers on the pulse of new trends and technologies. They are attuned to the industry changes.