Sourcing Strategy 6 5 4 Other chip companies have fabs, butmore of themare turning
to foundries to build some of their semiconductors. One reason is that a new fab can cost $3 billion and a semiconductor company may decide itmakesmore sense to outsource chip production rather thanmake the investment in a new facility and equipment.
As a result, demand for foundry services is rising and buyers at
OEMs need to make sure that the foundries their chip suppliers use have the technical capabilities and the capacity to handle growing demand.
Through the high’s and the low’s...
In some cases, LGE
buyers visit and evaluate rawmaterial suppliers. Copper, gold and othermetals are used in boards, components and enclosures.
0 1 2 3
The transformation of purchasing at LG Electronics into a centralised structure has resulted in nearly $6 billion in materials cost savings in 2009 alone
Linton added: “We are engaged at themulti-tier level all theway down to rawmaterials. I encourage my buyers to visit some of the mines that sell to themills that ship to assembly houses.”
Why ismulti-tier sustainable
sourcing necessary? It’s all about an OEM’s brand said Linton: “The DNA or genome of the supply chain is important to the end customer.” End customers have becomemore socially and environmentally conscious and want to be assured the company whose name is on the product is also socially responsible.
Linton said: “The consumer
...we’ll keep you on track.
buying an LCD television wants to know that the TV wasn’t assembled by a 12-year-old in China or that the cobalt used in a battery in a cell phone was not mined by children using their hands.” Ultimately it is the responsibility of the OEMtomake sure that suppliers do business in a socially responsiblemanner.
Trust, but verify
Linton said: “Multi-level sourcing helps an OEMhave visibility, transparency and openness in the supply chain. OEMs can’t necessarily rely on their supply chain to do the right thing. You can trust your supply chain, but you have to verify. If you don’t verify, you are going to hurt your brand.”
Linton points to Apple as an
You don’t need us to tell you that Its been a tough time recently with all industries feeling the effects of the rollercoaster- like world economy. With things getting worse in the electronics market in terms of supply chain, its good to know that Rebound has not lost sight of the basic principles of electronic component supply.
As an independent distributor of electronic components with global sourcing and supply capabilities, we understand the unique challenges faced in the industry. This means that as shortage issues increase and lead times are pushed further and further out, our market knowledge helps our customers breathe easy knowing that their dedicated account team will find the parts they need to get the job done!
If you’re having problems managing inventories, lead times or just staying on track give us a call: +44 (0) 1635 555 999
example of a company whose brand was tarnished a few years ago after a keymanufacturing partner was accused of having unsafe working conditions and using child labour in manufacturing Apple products.
Linton adds the trend toward
multi-tier sourcing for some companies is a counter trend of outsourcing. In the 1990s,many
16 | November 2010
www.electronics-sourcing.eu
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