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Distribution is the service supplied by companies that stock and supply electronic/electro-mechanical components from a wide range of manufacturers. These commodities are made available to customers through a wide range of services and delivery methods.

Distributors which have made commercial deals to stock/represent certain manufacturers' products are called 'franchised' distributors. Distributors refer to those manufacturers they represent as appearing on their line card.

Non-franchised distributors/dealers also have a part to play by providing stock that is not available through franchised distribution. Typically they might buy excess or obsolete stock from OEM/CEM partners and trade it on the open market. This is sometimes referred to as the 'grey' market.

Mainstream franchised electronic component distributors have been around for some considerable time. However, the explosive growth of the electronics sector in the early 1990's, particularly the mobile telecommunications, computer gaming and personal/business computing sectors resulted in a re-shaping of the service offered by the world's leading distributors of electronic components.

Furthermore, globalisation and supply chain economics has further influenced market dynamics, resulting in the need for specific customer focussed solutions.

The ability to get what you need, in cost effective quantities, when you need it, from the best global sources at the lowest acquisition cost has become the norm expected by buyers. As a result, component distributors have launched various 'value-added' services in the marker to attract and retain customers.

Typical services offered by mainline franchised distributors include:

  • Engineering support to aid in component selection & design
  • BOM 'scrubbing' for obsolete and end of life parts
  • Automated warehousing and distribution of components
  • Integrated online, real-time computer systems
  • PC-based replenishment systems
    • e.g. Consignment Stocking
    • e.g. Vendor Managed Inventory (VMI) Systems
  • Component Buy Back
  • Device programming and cable manufacture
  • Component Kitting

Materials Management Topics




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Guide Written by Paul Wilson

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