Interconnection Taking
distribution seriously
Neil Tyler talks connector distribution and manufacturing with Simon Hammerton, the managing director of Lane Electronics
B
ased just outside Horsham in Sussex Lane Electronics is a UK connector distributor and part of the Lodge
Group, which also includes the high reliability and military connector manufacturer Weald Electronics. Established in the 1960s the business has grown steadily over the last forty years but, like many connector companies, is faced with an increasingly competitive environment which is forcing it to adapt and change to better meet the needs of its customers. The group has a turnover of around £8m of which Weald Electronics accounts for around 40 percent. Weald manufactures electronic and electrical connectors for military and industrial interconnection applications and has specialised in high quality military circular connectors that are based on the Mil-C- 5015 & Mil-C-26482 specification. As the market for circular connectors has evolved it has become more competitive with a wide range of formats now available, with a broad choice of pin counts, materials and plating options. Connectors are also getting smaller and lower cost and designers are now increasingly concerned with RoHS compliance.
Companies are having to focus on price and performance as much as on good electrical properties, size and weight. For FC Lane the distribution market is similarly challenging as Simon Hammerton, the managing director explains. “Traditionally we’ve focused very heavily on the military market and on the UK; that is having to change. While there’s certainly still a lot of work out there, there is not as much as there was and, as a distributor, you have to work a lot harder to operate in the current environment.” Lane Electronics serves a number of
24 March 2013
leading electrical connector manufacturers including the likes of Huber & Suhner, Souriau, Radiall, ITW McMurdo, ITW Pancon, Polamco, Glenair, AVX and Amphenol as well as acting as the sole global distributor for Weald. According to Hammerton to succeed you need to be able to differentiate from the competition. “We believe in holding stock for our customers, otherwise you’re not very different from the manufacturer you look to serve. For many customers if you don’t look to add value why deal with the middle man, when you could go directly to the manufacturer. We believe that quality and availability are the key drivers in this market at present so we don’t just focus on high volume, fast moving stock. We look to offer a diverse range of connectors, so we stock a very wide range of variants with different contact styles, finishes and special orientations. We hold a lot of a stock.”
Partnership
Hammerton suggests that because the market is far more competitive than it was, just a few years ago, it is far harder to operate in and, as a result, it is more important than ever that companies operating in the connector market establish a good relationship with their customers. “We need to become a real partner with the manufacturers we deal with as a distributor. We invest heavily in product
Components in Electronics
Simon Hammerton, managing director of Lane Electronics
and look to work closely with our client’s production schedules. If you’re going to keep their business you need to offer added value, flexibility but also a willingness to share in the risks that manufacturers face. In that way you really do become a trusted partner.
“Customers will always focus on price and unfortunately the downward pressure on pricing is growing. That’s why we focus on quality and availability.” As the domestic and European markets become ever more competitive both FC Lane and Weald are looking to grow their businesses overseas and are targeting new markets like India, South Africa and Australia. “We’re looking at fast growing markets and in the case of Weald we are looking to adapt products that have traditionally served the needs of the defence market, targeting those markets that require high- end industrial applications. The mining sector has been identified as a key market for Weald. Our connectors serve these extreme environments well and require just a few minor design alterations.” For more demanding environments such as mining FC Lane is able to offer a wide selection of circular bayonet coupling and screw coupling power connectors, filtered circular connectors and cable connectors in
changes rapidly and if you don’t continue to invest you will become less and less competitive.”
For a company which deals with a wide variety of connectors, usually in small batch numbers, only certain areas of production are worth being automated, according to Hammerton.
“Because of the small batch sizes we tend to work with automation would only work for us in certain cases. If we had to continually set and re-set machinery that would be counter productive. More importantly for us it is about providing the workforce with the right tools so that we can make the manual process easier and more efficient.”
Better equipment and better systems? “Exactly, both. We’ve not only invested in new equipment but in better systems and more intelligent stocking at FC Lane. We invested heavily in ERP software a few years ago and now have in place a very good stock control system. As a distributor it gives us the intelligence we need to be effective, to study trends, look at usage and manage the 20,000 lines of stock we hold. It gives us the right information to manage our lines based on usage, predicted usage, reorder levels and reorder points taking into account manufacturer lead times.”
The success of the company’s stock management was due in no small part to the efficiency of the manual process that had been in place before.
“The holes and glitches had been
ironed-out many years ago, so when we computerised the process it ran really smoothly. Don’t rely on software alone to solve your problems.”
Positive future FC Lane and Weald continue to see growth in 2012.
“What is important is how we, as a
group, perform. Perhaps we didn’t grow as fast as expected last year, but the UK market is tough at the moment and very competitive. But over the last ten years we have grown significantly year-on-year and that is sustainable growth. We are looking to the long term and that requires building long term and long lasting relationships with customers. That takes time. Don’t get me wrong we’ll take business if it comes along but our focus is not on one-off deals.”
Hammerton accepts that the company may have to revise its expectations going forward in light of the economy’s weak performance. However, he believes that if the company is prepared to work for it, it can maintain growth into 2013 and beyond, driven in no small part by the new initiatives introduced since 2010. “Not only do we have to contend with
a wide choice of materials and finishes, as well as a number of specialist ranges. The move to identify new markets began post 2010 when the Coalition came into power and a programme of austerity, involving defence cuts, was initiated. “We had to respond to a changing economic environment and the impact it was having on our markets,“ Hammerton explains. “In the case of Weald we’ve continued to invest in the business because that is what our customers expect. Machine tooling technology
difficult economic conditions, growing competition from European and Asia companies, but how the business performs will depend to some extent on how the military side of the business performs. If it declines more quickly than we expect and the new markets we’re opening up don’t deliver as quickly as we’d like then our plans will have to be revised. “What I’m sure of is that as a UK business we need to focus on higher end specialised products and while we can’t and wont compete with low labour rates, if you get the balance right in terms of product and efficient manufacturing, we can certainly compete in terms of quality, reliability and speed of delivery.” ■
www.cieonline.co.uk
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