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When trying to reduce component costs, the right supply chain partner can make a difference. Here’s how. 

Many global OEM and EMS companies, large and small, are aiming to reduce component costs as they search for cost-saving opportunities amidst the rising price of land, utilities, and labor.

Finding the right part, at the right time, at a price that will not hurt the bottom line is not an easy task for any procurement professional. Time-consuming sourcing and drawn-out negotiations can be very challenging. That’s where a qualified electronic parts distributor can make a difference by guiding you through the complex global supply chain to help your organization reduce component costs. 

Let’s take a look.

1. Access to global market information and inventory can lower component costs

Established global distributors can tap into robust global sourcing networks. With sourcing experts located across the globe or — at the very least — several countries, they have access to first-hand global market information and can react fast. 

Take the tariff war in 2019 between the United States and China as an example: Sourcing experts in Asia took expedient action to locate parts from a different country of origin. The result? Customers were able to avoid the 10-15% tariff on some imported components. 

Local sourcing teams also leverage connections to find the latest information on excess inventory in the region. So when your regular channels fail to meet pricing expectations, your supply chain partner can give you another option to find what you need. 

2.Benchmark approach on component pricing

Market trend experience is not built overnight. It can take years for procurement professionals to truly understand the market for electronic components.

Enter the experienced supply chain partner. With decades of industry knowledge, the partner sits on a treasure trove of market data. Count on your partner to help you take advantage of price variations and to strategically optimize the right time for procurement.

3.Bulk ordering brings better pricing

Tier-one OEM and EMS companies typically have a leg up on their small and medium-sized counterparts when it comes to securing parts at the desired price point. So, how can you compete on more equal terms? Consider the benefits of partnering with an electronic parts distributor with clients across a spectrum of industries. 

The distributor can aggregate demand using BOM information. With a bulk order on the table, the distributor is in a better position to negotiate a favorable price — and pass on the savings to you. 

4.Don’t forget about quality

Quality always comes first. And sourcing components for cost reduction is no exception. Faced with multiple offers, you may find it difficult to validate the quality of individual parts. Again, partnering with a trusted distributor can eliminate the risk of counterfeit or defunct parts entering your supply chain. The right partner does not only screen suppliers but also test parts to ensure optimal quality. 

Does your organization need improved access to vast networks of electronic parts? Are you looking to reduce components costs while staying true to your commitment to quality? We can help. Contact us today to learn more.

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