Who’s Taking All My Inventory?

Manufacturers are quite aware that they are operating in a shortage market with major allocation issues, but do they fully understand why? Knowledge is power, and we aim to enlighten manufacturers with a quick discussion on the high-demand markets that are fast absorbing the inventory on which their products have long relied.

Automotive

The automotive industry is a good place to begin the conversation; it’s an industry to which everyone can relate. More and more electronic components are being configured into automobile designs as cars become increasingly high-tech.

“The automotive industry has been experiencing a rapid transformation with products incorporating electronic components at an unprecedented rate,” Jabil says. “Demand from the automotive sector is also somewhat stable with accurate forecasts.”

The supply of resistors is being impacted by demand from the automotive space. According to Kodiak Assembly, “[R]esistors are a critical component of any electronic device, [and] just about every electronic device contains resistors, which means there are likely a lot of manufacturers vying for the same components in order to make many different things.” This is further evidenced by EPS News: “Automotive companies are competing with major consumer electronics manufacturers for components.”

Mobile

Smart phone technology is constantly changing, and the devices are becoming increasingly prevalent all over the world. In fact, “the smart phone market [is] the primary driver of consumption and technology” reveals Jabil. Additionally, in this segment, components are becoming smaller and smaller. This contributes to the component obsolescence conversation, especially when larger parts head toward obsolescence.

IoT

A wide variety of industries are implementing IoT technology into their devices. “This explosion of growth unlocks new business opportunities and models for OEMs worldwide, but it creates additional demand on an already constrained market,” says Jabil. Certain types of products are using IoT more than others, and right now industrial products are at the forefront.

According to Forbes, “Industrial products lead all industries in IoT adoption at 45% with an additional 22% planning to adopt IoT in the next 12 months according to a recent Forrester survey.” IoT Analytics reveals the manufacturing industry is anticipated to be “the biggest IoT Platform segment reaching $438M by 2021 as more and more companies are realising the benefits of connecting industrial equipment to streamline operations and reduce costs.”

We’re All In This Together

As time and innovation marches on, there are bound to be additional markets of note in this discussion. In the meanwhile, this piece serves as an outline for manufacturers so they can stay abreast of industries who might be “stealing” the components integral to the fulfillment of their products. To stay ahead of this “theft,” EDX is here as your trusted supply chain partner to navigate you through the changing tides of today’s electronics manufacturing climate.

Leave a Reply