{"id":4145,"date":"2021-02-01T17:27:03","date_gmt":"2021-02-01T22:27:03","guid":{"rendered":"https:\/\/a2globalelectronics.com\/?p=4145"},"modified":"2021-02-01T17:27:52","modified_gmt":"2021-02-01T22:27:52","slug":"5-ways-to-overcome-stretched-electronic-component-lead-times","status":"publish","type":"post","link":"https:\/\/a2globalelectronics.com\/ja\/shortage-mitigation\/5-ways-to-overcome-stretched-electronic-component-lead-times\/","title":{"rendered":"5 Ways To Overcome Stretched Electronic Component Lead Times"},"content":{"rendered":"

For electronic manufacturers, failing to secure much needed parts in a timely way is a real-world nightmare. Let\u2019s look at a handful of strategies that combat long electronic component lead times.<\/h2>\n\n\n\n

Increasingly long electronic component lead times have been plaguing the electronics manufacturing community for months, if not years. The bad news: it’s a trend that is likely to continue for the foreseeable future. The good news: there are strategies that can strengthen your organization\u2019s sourcing stance and mitigate shortages<\/a>.<\/p>\n\n\n\n

No end in sight<\/h2>\n\n\n\n

Uncertainty is an ongoing reality in the current manufacturing landscape. COVID-19 will likely remain a leading cause of sourcing slowdowns for the electronics industry. A new administration guiding U.S. policy puts tariff and trade concerns on the radar \u2014 and the trade war between the United States and China will continue.  Dimensional Research writes in the Jabil-sponsored report, \u201cSupply Chain Resilience in a Post-Pandemic World<\/a>“: <\/p>\n\n\n\n

Supply chain complexity is at an all-time high. Component shortages are causing constraints and affecting end-of-life, which means a two-cent component can spark line-down issues. Supply chain managers have to contend with trade disputes, climate change, macroeconomic shifts and natural disasters. They often lack advance warning before an effective supply chain is rendered inefficient.<\/em><\/p>\n\n\n\n

At the same time, economic activity in the manufacturing sector overall is up for the eighth consecutive month. In the recent December report from the Institute for Supply Management (ISM) Manufacturing report<\/a>, overall manufacturing registered at 60.7%, up 3.2% from November. New orders reached 64.8%, up 4 percentage points from the previous month. In fact, computer and electronic products experienced moderate to strong growth, according to Tom Fiore, chair of the ISM Manufacturing Business Survey Committee.<\/p>\n\n\n\n

Business leaders agree. \u201cBusiness is stronger than expected, with higher demand for many products,\u201d said one survey respondent in the electronics sector. \u201cVolatility continues due to the very persistent pandemic and associated risks.\u201d <\/p>\n\n\n\n

 <\/h2>\n\n\n\n

Learning electronic component lead-time basics<\/h2>\n\n\n\n

Component makers may need weeks or even months to get a component from raw materials into the hands of the customer. Consider the components of lead time<\/a> from the Corporate Finance Institute, CFI.<\/p>\n\n\n\n

1. Preprocessing (planning) time: Time taken to receive a request for replenishment, understand it and create a purchase order (when buying an item), or create a job in the case of a manufacturing firm.<\/p>\n\n\n\n

2. Processing time: Time needed to procure or produce the item.<\/p>\n\n\n\n

3. Waiting time: The lag caused by procuring items to when production starts.<\/p>\n\n\n\n

4. Storage time: The time items sit idle in a warehouse or factory awaiting delivery.<\/p>\n\n\n\n

5. Transportation time: Time necessary to get produced item from warehouse\/factory to customer.<\/p>\n\n\n\n

6. Inspection time: Time used by customers to ensure product meets specification and\/or deal with non-conformity.<\/p>\n\n\n\n

A variety of external factors can contribute to long lead times, as spelled out in this article<\/a> by Titoma, a company that optimizes electronic design for manufacturing with best-value Chinese components.<\/p>\n\n\n\n