Distribution Keeping ahead of demand
By Mark Burr-Lonnon, senior vice president of global service & EMEA and APAC business, Mouser Electronics
T
he electronic components industry has been on a tumultuous journey over the past couple of years, with the pandemic causing problems in global production, followed
by the aftershock of components shortages due to pent-up demand. A couple of years on, supply chain bottlenecks are still causing shortages in some areas, with long lead times for select products, such as semiconductors, causing continuing difficulties for sectors like automotive manufacturing.
Other macroeconomic challenges have also entered the mix. Inflationary pressures and higher interest rates are being felt in many parts of the world – impacting consumer confidence and leading to a slowdown in the global economy.
Yet despite all these challenges, the electronics industry has shown itself to be remarkably resilient and forward-looking. Many companies have responded to the ebb and flow of global market conditions by taking a long-term view of investments. Product development has continued – leading to exciting advances in a broad range of areas, including:
Industrial automation IoT-related smart homes Artificial intelligence and robotics Medical and healthcare, such as wearables
Even when faced with adversity, electronics manufacturers have committed to innovation to enable them to weather the storm.
Expectations for the year ahead All indicators are that the industry overall will see levelling out this year compared to the recent years of steep growth. The signs are however positive – with many analysts predicting steady growth as demand for semiconductors and other electronic components holds relatively firm. At Mouser, we expect 5-10 per cent growth across all regions; this is over and above the strong global growth of 25 per cent in 2022. In Europe, we grew by over 30 per cent in 2022. As a New Product Introduction (NPI)
22 May 2023
distributor, our biggest challenge is to keep up with demand and ensure there are enough components from manufacturers on the shelves. To do that, there needs to be a firm commitment to investment – not only in product introductions and managing inventories, but also in facilities, equipment, and online platforms and tools. That rounded package of investments will solidify Mouser as well-positioned to make the most of sustained demand that we predict again in 2024.
Managing inventories and building up stock
In the last two years, we’ve added 169 new manufacturers to our lineup. Increased investment in stock means there are over one million parts available, and we are continuing to add more manufacturers and parts. More than 1.8 billion (USD) of stock is on the shelf today – up over last year’s high on inventory. But inventory planning never stands still. In 2022, Mouser shipped out more than six million orders. On
Mouser.com, our customers can search for more than 6.8 million products from more than 1,200 manufacturer brands. These figures demonstrate that design engineers can get what they want, when they need it, to power the process of innovation.
Components in Electronics
Investing in facilities and equipment The next critical area of investment is in facilities. In August 2022, Mouser broke ground on a 416,000-square-foot, three- story building that will significantly expand our global headquarters and distribution centre, located south of Dallas - Fort Worth, Texas. The new facility will feature a triple-mezzanine floor plan, advanced automation, and a sky bridge connector to the existing distribution centre building. The additional space of over 1-billion-square- foot will support order receiving, pulling, and shipping – which is crucial to the performance of any e-commerce operation. Our Texas distribution centre is already one of the most advanced facilities of its kind anywhere in the world. Mouser has installed 138 vertical lift modules (VLMs) - essentially giant vertical filing cabinets, complete with shelves and an automated extractor to bring components to employees’ workstations. This equipment increases efficiency and floor space and has been shown to reduce an employee’s walking time by 45 per cent or more. The distribution centre also features multiple Ultipack and I-Pack machines — a sophisticated automated system for sealing and labelling shipments that can process up to 14 orders per minute — as well as an
OPEX Perfect Pick system for consolidation and an AutoStore system that uses small robots to pull parts. Ultimately, the adoption of state-of-the-art automation acts primarily to boost efficiency, productivity, accuracy and speed; the systems also enable more sustainable operations and improved customer satisfaction.
Flexible and accessible online tools Additionally, continued investment has been made into developing customer-focused online tools and resources to simplify and optimise the component selection and purchasing process. The Services and Tools page on the website, for example, provides resources for design and engineering, as well as for quoting and purchasing. Time-saving solutions include how to create a BOM with the FORTE tool, order automation resources, and an extensive ECAD design library. Also, the Purchasing Resource Library features dozens of articles and videos that give buyers the insights they need to make informed purchasing decisions. Meanwhile, the Help Centre allows customers to view and track the status of their latest component orders, download important documents such as data sheets, and place orders via API or EDI.
Helping engineers innovate and create
In conclusion, 2023 promises to be another positive year for the electronics industry, with sustained growth in all sectors and regions. That said, supply chain bottlenecks will not disappear entirely – and lead times for some necessary items are likely to remain extended in certain circumstances.
However, for NPI distributors such as Mouser, the impact of product shortages on customers can be significantly reduced through a combination of foresight, planning and investment in critical areas. With those fundamentals in place, engineers can get the components they need to innovate and create for tomorrow.
www.mouser.co.uk www.cieonline.co.uk
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