From a sourcing perspective, there are three key things that have impacted the market: lead times. pricing and inflation, and transportation, lead time and costs.
All of these areas have ballooned over the last couple of years. Not only are we seeing this across the electronics industry in general, but also specifically in the power space. We’re joined by Paul Kopp, Director of Supplier Marketing for Power Products at Sager Electronics, to discuss the challenges and solutions out there for pros sourcing power supplies these days.
Power supplies are complex and there’s a lot of components on the AC to DC side, so you can have hundreds of different components in that bill of materials. Lead time is going to be a factor of the longest lead time on the components. When coupled with production and capacity, purchasers are facing many problems.
“What we’ve seen is a situation where lead times typically would be eight to 12 weeks, then slowly crept to 15 to 20, to 24, to 26. Now we’re seeing 40 to 52 and beyond. So it’s, it’s been a challenge for customers, ” says Kopp. This became especially challenging for those who were used to a “just-in-time” mindset. Now they’ve transitioned to “just-get-me-product”.
Just like the normal lead time stretched, transportation did, too. Historical transportation methods, could take about four to six weeks to get from Southeast Asia to Long Beach, but now that’s gone up to 12 to16 weeks.
Authorizing air shipments as an alternative isn’t so easy either. The problem with air shipments is they’ve tripled, quadrupled in price so it’s become cost prohibitive as a lot of these power supplies are heavy, big, and bulky, adding weight and, in turn, adding to the price.
Is help on the way?
There are still a lot of challenges ahead, but Kopp is optimistic that by this time next year we may start turning the corner.
“I do think what we’ll see first is the transportation issues start to get better. I think once they get better, then we’ll start to see improvements in other areas. You know, that’s assuming we don’t have another variant. And that’s not something else that makes us take a step back. But I do think, over time, the supply demand fluctuations will start to smooth out a little bit,” he says.
Currently, there’s so much built-up demand that it’s going to take a while for suppliers and their suppliers to really catch up.
Watch the full video to learn more about the challenges the industry faces.
What You’ll Learn:
- The effects of tariffs
- How buyers are responding to these new constraints.
- Why warranties matter in the power supplies space
- Safety considerations when sourcing power supplies
- How Sager’s customer support and experts can help alleviate some of the current challenges