Front End | Electronic Components Supply Network Components markets stall
The great uncertainty currently pervading the global economy could easily lead to a slowdown in global growth in 2025 as measured by GDP, probably in the range of 0.5% to 1%. This looks to be a fairly small change but its impact on business sentiment and investment could be significant. According to Adam Fletcher, chairman of the Electronic Components Supply Network (ecsn), European electronic components markets were slowly improving but stalled somewhat in 2Q’25. “Despite indicators that global lead-times are extending and prices are rising I believe that European electronic components markets are likely to continue to ‘bounce along the bottom’
in 2H’25, but I’m optimistic that stronger stable growth will return in the first half of next year,” says Fletcher, but he cautions “organisations failing to react to current market signals could experience problems with the availability of some components they need”.
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anufacturers of electronic components and the Authorised Distributors that represent them keep a close eye on
three key industry metrics: ‘Bookings’ (Net New Orders entered), ‘Billings’ (Net Invoices Raised on Shipment) and the relationship between the two known as the ‘Book to Bill’ or B2B ratio. Taken together these figures provide a valuable insight with which to gauge how their organisation and the overall market is currently preforming and likely business outcomes. At the end of each year members of the Electronic Components Supply Network (ecsn) collaborate to arrive at a consensus view on the likely outcome for the current year and a forecast for the year in prospect. Trying to distil a wide range of opinions into an agreed outcome is always a challenge but in the past twenty-five years the predictions of ecsn members have proved to be >75% accurate, a track record far better than many other industry forecasts!
UK and Ireland – 2025 so far Compiled from the latest available data the graphic “Forecast Billings – Actual and F/C 2025” clearly reveals that the UK / Ireland electronic components market is struggling to make any meaningful recovery. The ‘pink’ line is the actual ‘Billings’ (sales revenue) by quarter and shows a decline throughout 2023 and 2024, a brief return to growth in Q1’25 before it declines once more in the second quarter of the year. At best, Billings in Q3 and Q4’25 are likely to be ‘flat’ in line with the historical seasonal pattern and, sadly, there is no evidence to indicate a change in this
12 July/August 2025
pattern any time soon. The ‘red circle’ on the graphic displays ecsn members’ forecast of their market’s minimum, maximum and mid-point values, which clearly shows the ‘miss’ between their expectations and the reality. Manufacturer- authorised distributors of electronic components support over 98% of the buyer / seller relationships in the UK and Ireland
Components in Electronics
so the data recorded and returned by ecsn members each month can be regarded as highly accurate.
What’s going on?
The greatly extended manufacturer lead-times that prevailed throughout the entire global supply network in 2022/3 spurred customers into vastly over-ordering
electronic components throughout 2024, at a time when in fact ‘real’ demand was significantly declining. This resulted in an “inventory overhang” some of which was still in place in Q1’25, probably equal to one quarter of average demand. This will have to be further brought down (consumed) before a stable recovery can realistically be expected, so it’s no surprise
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