Facing volatility in the high-reliability component sector? Consider a lifetime buy. Here’s our take on the market.
Market trends in early 2019 indicate that the heavily allocated market of recent years is shifting back to a more standard situation. However, we are seeing a trend of increasing obsolescence for critical high-reliability electronic components. Over the last few years, a series of mergers and acquisitions by electronic component manufacturers has taken place.
A major result of these changes? A significant reduction of component lines that high-reliability verticals have built their products around and want to continue. As mergers take up market share, competing product lines align under one manufacturer.
The resulting situation can threaten a whole product line, putting incredible pressure on OEMs in high-reliability verticals.
There are ways to absorb the impact of this change. Keeping high-reliability products on the market takes some strategy, but there are cost effective solutions when obsolescence threatens.
The far-reaching impacts of end-of-life notices.
Elimination or consolidation of product lines can happen rapidly, with major impacts to your process. Obsolescence or part-change notices sometimes provide just a few months to make last orders before they discontinue.
With that kind of turnaround, you need to have confidence in a partner before outsourcing the challenging situation of purchasing and storing your critical EOL materials. There is a lot at stake, but the upsides of a lifetime buy — ongoing access to the precise parts you need without any need to redesign your product or any worries about quality control — make this an attractive solution to an EOL situation.
Mitigating the risks of high stakes purchasing.
A lifetime buy can mean product line survival. When you encounter an EOL situation, you may need to act quickly to execute a lifetime buy. The large scale and attendant management considerations of a lifetime buy makes it a major business decision.
At the core of this decision? Finding a trusted EOL solution. Once the EOL purchase is made, you will need long-term storage to ensure that your inventory is safely managed
First up? How long has your potential partner handled these sorts of buys? You could gamble on a new player in the market to save money. But there are a wide host of risks with an unproven entity and this kind of high-value purchasing.
If they aren’t properly insured, or don’t handle the storage carefully — not to mention their financial stability — your lifetime buy is at risk. There are just too many ways this could go wrong when outsourcing to an up-and-coming partner.
Finding your ideal solution.
Once you’ve identified a safe partner, you should tweak the solution they offer to precisely fit your needs. The customization of lifetime buys should include strategies like re-banking and provide clear insight into security measures for storage.
