Beyond Shortages: Why Should I Work with Independent Distributors?

Yes, it is still worth to work............... Really?

In recent months I talked with many clients, small to big every type clients. I observe that most of them think that an independent distributor or Broker is only useful during shortage time.

In this piece, we are going to discuss two main points to see why it is still worth working with Brokers or exploring the open market.

1. PPV or Scheduled orders

Last month I had a scheduled order with one of the top 50 EMS companies. During the quotation phase, I was surprised to see that for at least 50 items out of 500, my prices were way lower than my client's TP.

Shocked, I started to search and came to know that for many items open market has plenty of stock and suppliers are competing on prices to liquidate their inventory hence open market prices were lower than the original prices.

And even for the other 100 items, my prices were just a little higher than the original prices.

So, it means that it's still worth checking in the open market before placing scheduled orders with your regular suppliers.

This will help you to get parts at lower prices and will also put you in a better position to negotiate better prices with your regular suppliers.

2. EXCESS Stock

Your independent distributor can help you in two ways.

1. Help you to liquidate your excess inventory.
2. Help you to get other client's inventory at discounted prices

MBRS3200T3G ONSEMI, I sold 200k pieces of this part two months ago, this was the excess inventory of one of the Fortune 500 companies which they sold to me at a 40% discount rate.

There are hundreds of other examples like this but I think you got my point about how a broker can help you to sell your excess inventory and also help you to get your required part at good prices from excess stock.

But..........

while buying excess stock choose some trustworthy and established Broker who can give surety of quality.

There are also other benefits to still working with brokers like finding EOL or obsolete items, shorter lead times, faster responses, etc.

Let me know in the comments if you want to ask something or wanna add something to this topic.

#Ammar #Semiconductors #Supplychains