Demand Exceeding Supply- Shortages in the Electronic Component Market May Push Prices Up
A slowing down in the availability of electronic components, computer hardware, and surplus parts leads to the potential for an increase in component prices as accessible supplies lack the volume that they once had. Lead times are increasing in general across the electronic component industry as redistribution and delivery efforts are hampered by an immediate lack of critical items within this sector of the industry.
The gap between component demand and supply could constrain the easy flow of parts from distributor to recipient leading to price increases within the electronic industry. This should not come as any great surprise as the current state of the economy suggests that many global markets are experiencing similar disparities between current supplies and present demands.
Buyers of electronic components and computer hardware can expect variations in this scenario as it plays out across the world due to the ever-changing fluctuation in demand within the component market itself. Pricing trends are perpetually linked to the existing demand for supplies, so pricing fluctuations have always played a part within this area of the industry.
Nonetheless, component price increases are limited in value, and therefore, these increases should not create an appreciable difference over the short term. However, a long term lack of availability in electronic parts is more likely to lead to prolonged price increases of greater value creating appreciable changes in the prices of electronics overall.
Avoidance of Counterfeit Parts within the Electronic Component Industry
According to NEDA, the National Electronic Distributors Association, the need to remain vigilant against counterfeit parts within the electronic component industry is more important than ever. While counterfeits have infiltrated electronic component supplies for years, the poor state of the economy offers the perfect atmosphere for a new influx of counterfeit parts. Unless a company within this sector takes immediate steps to identify and avoid non-authentic parts, the cost to their business can be astronomical.
The results of various studies suggest that counterfeit parts make up a fair percentage of available components within the electronic industry. The presence of counterfeit electronic components is bad for business- bad for distributors and bad for purchasers. The cost to distributors can be even greater as their reputation can suffer greatly limiting the potential for future orders. For the company who unknowingly purchases counterfeit parts, production can suffer leading to lower profits and damage to the company’s reputation as well.
Heeding the call to avoid counterfeit parts has long been a part of EE ALL Parts Quality Control Policy. The company has consistently utilized a proactive counterfeit component policy implementing precise avoidance strategies aimed at keeping counterfeits from entering their available inventory. Verifying the authenticity of computer parts, computer peripheral components, and electronic components is at the core of the quality policy. As a distributor of such components, EE ALL Parts utilizes specific controls and measurement equipment to identify counterfeits and remove them from their inventory.
Electronic Industry Spotlight – Global Market for Mobile Phones Experiences Continued Growth
Distributors and manufacturers of mobile phones continue to experience an increase in sales as global demand intensifies. According to the Gartner Research firm, global demand for mobile phones increased by approximately 35 percent in the third quarter of the current year (2010) from the third quarter numbers of last year (2009). This increase in mobile phone sales is expected to continue as demand peaks in the fourth quarter, especially given the existing trends for seasonal sales in the electronic device market.
Vice President Carolina Milanesi suggests that consumer demand is strong stating, “This is the third consecutive double-digit increase in sales year-on-year.” In particular, sales of smartphones are strong bringing them into place directly behind Android versions of cell phones. As long as consumer demand continues to swell, sales of mobile phones will continue to increase providing the market with positive statistics despite the dreary state of the economy worldwide.
The increase in demand and resultant sales of mobile phones bodes well for the electronics industry overall. New manufacturers have the opportunity to expand their reach globally while well-established mobile phone manufacturers continue to exceed their expectations regarding the tug-and-pull of supply-and-demand. However, minor disruptions to this steady flow of mobile phones to consumers has been temporarily interrupted in some cases as the supply of electronic components and modules has experienced delays in production and therefore, in lead time.
Smart Wireless Devices Spurring New Growth for Electronic Component Industry
The ever-changing nature of technology and modifications in technological devices can be credited with a surge in growth for the electronic component industry in general. In particular, smart wireless devices are responsible for an increase in demand for specific parts needed to develop and manufacture a growing list of smart wireless devices. Innovative changes in electronic devices consistently necessitate a need for innovative changes in the components that comprise them.
As a result of the need for a new line of electronic components, modules, and semi-conductors, the ECD industry must adapt in a significant manner in order to keep up with the growing demand. Electronic component and semi-conductor companies with the capacity to incorporate immediate upgrades to their inventory have the ability to weather this transformation in demand and come out shining above their competitors.
In fact, the ability of the industry to continually meet new demands and adapt to integral changes as created by changing demand for electronic parts and devices has placed industry suppliers in a unique position to experience expansion and growth right alongside of the smart device manufacturers. However, perhaps the more salient point to this growing change within the industry is the fact that this trend is likely to continue long into the future. As consumers demand streamlined electronic devices, manufacturers will bend over backwards to accommodate them leading to a continual transformation of the electronics industry in general. Nothing new there as these companies have already walked down this trail before now.