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Materials Management

The material content of an electronic product can typically make up between 40-80% of the item's selling price depending upon the industry sector.

As a result, supply chain managers have vital roles to play in adding value to their respective businesses. These include securing supplies of components, ensuring consolidated spend results in component cost reductions, and transporting raw materials and finished products in the most expeditious and cost effective manner. If they can do this then they can significantly improve the profitability of their company.

This is a complex conundrum and as a result, a host of third party solutions have evolved to support the supply chain team of manufacturing companies.

Typical solutions include:

  • Franchised Distributors - who provide design support, components and other added value services.
  • Non-Franchised Distributors - who plug the gap of short term requirements and materials shortages.
  • Kitting Houses - who prepare total kits of parts in required quantities to support specific builds.
  • Freight Forwarders - who manage the transportation and customs clearance procedures of raw materials and finished goods.

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Guide Written by Paul Wilson

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