Prices and lead times from Absurdistan?

Multi-source, smaller designs and rolling forecasts

The problem of availability becomes particularly apparent when customers have only approved one manufacturer per component. Johann Weber therefore appeals urgently to customers to approve two to three manufacturers as alternatives in order to be able to switch-over if necessary. Changing to smaller designs for passive components could also alleviate the need or protect against new and unpleasant surprises.

In the same vein Andras Kraus reports on the announcement from an important capacitor manufacturer that where parallel components with the same electrical data currently still exist they plan to discontinue the larger devices.

“In addition, rolling forecasts covering one to two years are crucial so that we can enter into discussions with manufacturers and distributors at an early stage,” Weber appeals to the industry. Although there are still advice-resistant customers here and there who do not want to make long-term plans, the majority of customers are now ready for long-term forecasts after intensive educational work and a deeper understanding of the supply chain by the EMS companies, the Forum participants explain. “But this is our duty. Because if the forecast was well coordinated and we still have to disappoint the customers, that is of course unfavorable,” emphasizes Schmitt.

However, forecasts are sometimes nothing more than crystal ball gazing and even very renowned OEMs find it difficult to submit reasonable sales plans, according to Ralf Hasler. This means that the risk in the supply chain is passed on to the EMS, and he, in turn, is responsible for the procurement of materials for production orders, unless the material is provided, which is becoming increasingly rare. “If you have a few customers with fragile sales planning, the risks are extremely high, if you have a broad customer base, it can still be cushioned somehow; which is why we currently enjoy not only a sales level but record inventory too”.

According to Bernd Enser, Vice President Automotive Market Segment at Sanmina, the systems world that the industry has created represents a challenge. The functionality of this system chain can be found in the ZVEI “Supply Chain” guideline. In a nutshell: Demand is triggered at one end of the chain. But until this action can lead to a reaction, the need looks quite different. “At some point, these threads become so thin that the slightest outside influence is enough to cause the chain to break,” says Enser. “We should think about whether or not we‘re willing to go back into real goods in the supply chain.” But even this is not the answer to the problem that the risk of material procurement in distributed supply chains is passed purely on to the EMS.

1. Prices and lead times from Absurdistan?
2. Multi-source, smaller designs and rolling forecasts
3. Consolidation and its consequences for purchasing - some opinions