Top Independent Distributors
people difficult to find products and providing creative solutions for cost savings and for inventorymanagement," said Barnhill. Barnhill believes 2011 will be a better year than last year, or at
least just as good. "We see across the board demand in every segment of our customer base for both commodity items and our service business," he said.
He also says opportunities created by the earthquake in Japanwill drive growth in the third or fourth quarter "when companieswant to
3.america ii elecTronics
America II is on a quest to show OEMs and electronicmanufacturing service (EMS) companies, one at a time, that the distributor lives and breathes quality.
"Mymain goal is to get every large customer to conduct a site audit
of America II because seeing is believing, and it takes away the concern about purchasing fromnon-franchised distributors, at least fromAmerica II," said JimMagee, president of America II Electronics Inc., St. Petersburg, Fla.
ButMagee says you can't just say you're a quality organization,
"you live and breathe quality as part of the culture." And last year's shortages certainly gave America II the opportunity
to prove it. "Availability of quality productwas the biggest challenge as lead
times extended," saidMagee. "That'swhywe performed sowell becausewe are inventory-centric.When you decide to be an inventory-centric company you have to develop processes to support inventorymanagement and inventory acquisition."
"The second biggest challenge is keeping the independents
separate fromthe broker channel in terms of a quality testing perspective," saidMagee. As part of its quality focus, America II has invested a great deal of time andmoney into bringing in a third-party test facility inside of the
4. Fusion Trade Fusion Trade's philosophy about qualitymirrorswhatmost leading
independent distributors say is one of their biggest, if not, top concern. The distributor alsomade a concerted effort about five years ago to take a customer-focused approach to its business in order to build relationshipswith its customers.
"Customer quality comes first in our entire organization," said
Carleton Dufoe, vice president of trade, Fusion Trade, Andover,Mass. "Quality is amajor aspect for every one of our customers.When they are transactingwith the openmarket theywant tomake sure that they are getting good quality products each and every time."
"Whatwe have nowis true customer relationships instead of that
of a broker just trying to sell themparts," said Dufoe. "Our quality process startswith our vendor qualification process,"
said Dufoe. "Newvendors go through a very strict vendor qualification process and product goes through a vigorous inspection process."
Fusion has two counterfeit detection labs, one inWilmington,
Mass. and the other in Hong Kong. The Anti-Counterfeit Screening and Analysis Laboratory enables the distributor to conduct both destructive and non-destructive screening and analysis.
The distributor's vendor verification process and vendor rating
systemincludes site audits, a 21-point receiving inspection process where all components are documented and audited aswell as a counterfeit avoidance programthat includes 100 percent traceability using database comparisons andmanufacturers' specifications.
This new business philosophy also helped Fusion Trade have a 28 | June 2011
make sure they have product to buildwith." "Youwill seemore traditional-type shortage situationswhere you'll
see some prices getting driven up and heavily allocated product in third and fourth quarter," Barnhill said.
To help keep upwith demand, Smith&Associates opened two new
offices in Taiwan and Singapore, and is nowlooking to expand in North America and Asia. Head count also has increased slightly over the last year.
America II Electronics at a glance Headquarters:
2010 revenues: # of employees:
St. Petersburg, Fla. $300 million 600
% of value-added sales: 10% Key expansions in 2010: Started to duplicate its test house efforts in North America at its Singapore location.
Key challenges in 2011: Availability of quality product and keeping independents separate from the broker channel
company's Florida facility. In place for three years, the solution, called Premier Semiconductor Services, offers a host of quality and counterfeit detection services including CCAP counterfeit testing, x- rays, decapsulation, solderability, and electrical testing.
America II says it didn't see an increase in counterfeits last year
because it has a tough vendor qualification process and an even tougher vendor suspension system. America II has suspended more than 4,900 suppliers for counterfeit parts over the company's history.
America II attributes its 26 percent growth rate in 2010 to
several factors including component shortages, higher average selling prices (ASPs) and some of the big EMS companies trimming their vendor bases.
Magee says 2011will be an investment year for America II,
expanding infrastructure in Asia, and potentially in Eastern Europe by the end of the year.
Fusion Trade at a glance Headquarters:
2010 Revenues: # of employees:
Andover,Mass. $250 million 100
% of value-added sales: 16% Key expansions in 2010: Doubled the size of its European office, established an on-site presence in Guadalajara,Mexico and tripled the size of its Hong Kong warehouse/quality hub
Key challenges in 2011:
Increased counterfeit activity, raw material price increases, persistent product shortages
very positive year coming out of the economic crisis. "Lead timeswere stretched out becausemanufacturerswere
running very lean after they cut costs over the last two years," said Dufoe. "It created a tremendous amount of opportunities for a company like Fusion and other independents."
There also have been some very quick shortages for some passives
such as inductors and other devices including diodes in 2011, said Dufoe. But the big issue for buyerswas cost. Devices that normally traded at
tenths of a centwere trading anywhere from15 to 25 cents, said Dufoe. There could bemore supply issues ahead as component
manufacturers obsolete some component lines ahead of schedule due to production problems caused by the Japanese quake and tsunami inMarch. As a result,many customers are reviewing their projects for the
next year and five years out, said Dufoe. He expects continued growth across all sectors aswell as in all repair segments,which has been on a growth path for the past 18months.
www.electronics-sourcing.com
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