Thank you all for the great feedback so far!! I will try my best to address all questions & comments.
mfbertozzi – Thank you for noticing our Social Media presence. Yes, we use multiple platforms (LinkedIn, Twitter, and Facebook) to raise awareness on the subject matter and to keep dialogs going. In fact, the motivation of this article was to promote awareness and educate other distributors and EMS & OEM companies, alike. My company, SolTec Electronics, has invested heavily in equipment and personnel to effectively detect and avoid counterfeits as have other companies like mine. Companies like ours should not be lumped in the same category as other independents that knowingly sell this type of material. We are like night & day. I hope anybody that feels strongly about this subject matter or is moved in any way would be so kind as to click on the social media share links at the top of this article so that we can help to spread awareness.
eemom – Yes, while social media has been effective in counter-acting the stigma associated with the industry, there is still much more work to be done. This is a 3 part article and in the final part (to be posted next Monday), I talk about solutions, trade organizations, and give tips on effectively selecting a reputable distributor. I hope this article will educate and motivate the reputable distributors to ban together and spread awareness on the subject matter.
Clairvoyant - I’ve been in this industry for over a decade and counterfeits have always reared their ugly head. The difference, it seems, is that in recent years, our military/defense has been hit hard by them as well. I expect this is as a result of being in times of war, a slow economy, and a desperate need for components. Therefore, some unfortunate decisions have been made in purchasing these types of electronics. In the news stories I have read where component distributors have been raided and prosecuted for knowingly selling counterfeits to the military --- none of the companies charged were reputable companies at all. It brings up the question of why mission critical components were being purchased through companies with such bad reputations in the industry. Again, it goes back to being uniformed, which is why my goal is to educate here. I talk about some of these issues and go into some solutions in the final pieces of this article, which will be published soon. I hope you will come back for the final pieces!
Thanks again for all of the positive feedback and your contribution to conversation. It’s such an important subject-matter and your opinions are very valuable.
kg5q (aka Respectfully Disagree) – In my opinion, while you give a thoughtful reply, much of it is discredited because you do so with a secret identity. If you truly stand behind the words you say, than why not post your name and organizational affiliation??? I respectfully disagree with your choice to post your reply on this subject anonymously. You allude to being a component manufacturer in your response. Component manufacturers could work together with independents to help verify components, but choose to turn a blind eye. I did take a shot at component manufacturers in my blog because they are notorious for advising “don’t buy from independents. Buy authorized only. It’s the only solution to avoid counterfeits.” That statement is no truer than telling somebody if they never leave the house, they won’t ever be hit by a car. While that statement is mostly true, it is not very practical advice. There is also the off-chance that a car will come plowing into that house one day … just like there have been instances where franchised distributors and authorized dealers have shipped counterfeits!! While it is rare, it does happen. Many authorized dealers will take back parts on an RMA and not properly inspect them. There have been cases where their customers have switched out original parts for counterfeit parts and they got re-stocked on the authorized dealer’s shelf waiting for their next customer (victim) to purchase them. While cases like this are rare, it does happen. So, is the answer to that to stop buying parts and stop building things altogether. To use a quote from your reply, “let’s use our heads here.”
We don’t need to be so extreme in our reactions here. As mentioned in previous post, independent distribution companies like mine, SolTec Electronics, have invested heavily in counterfeit detection and avoidance capabilities. We are in the front line protecting our clients. And, yes, we even sell directly to branches of the U.S. Government. Aside from procuring from the excess market, we also offer cross-referencng solutions and 3rd party part re-engineering to original spec, die packaging services. Of course, we always practice due diligence and go for full functionality testing when there is not traceability and the components are mission or life critical. The point of this article is that the requirement to do so should flow down from the OEM or EMS company in the first place and they should have measures in place to assure they are working with a reputable and capable independent distributor. Such a thing does exist. We are a viable business model that provides a much needed service to many clients around the world. It’s time to set the record straight when individuals, such as yourself, make all-encompassing statements that all independents are bad or need to be avoided. I invite you to read parts 2 & 3 of this blog series which will be published later this week and early next week. I give practical solutions on how to team with a reputable vendor and safely procure from the independent marketplace.
Whether sombody agrees or disagrees with the article, I do appreciate all feedback as I feel this is an important subject matter. Let's keep the dialog going!!!
It’s even more serious than what you have outlined - the US government purchased counterfeit components which had a "trap door” meaning they could be disabled at the worst possible time for US in an attack by our "partners" in China no doubt. Fortunately they were discovered - how many have NOT been? How are companies supposed to protect themselves? How are manufacturers supposed to stand behind products no matter where a customer buys them from? If any "Fred in the shed" can be a distributor what controls are in place? None? Have a look at this from Crane NWSS
It could be that some of the "distributors" may purposely be trying to cause harm? How do you insure that no counterfeit parts get into military - aerospace systems? Do you want to fly on an airplane which has suspect electronic components on it? How about bolts and fasteners? There have been fakes of them as well lots of them.
Every single problem I have been involved in and have been asked to solve has involved unauthorized distribution channels. Its like saying that theft is not caused by criminals - well the data and my experience tell a different story.
I don’t know any other way to limit the variability other than limit who you buy from and they should be authorized distributors. The reason in my experience that companies get themselves in trouble is they don’t plan well. I had a company building nuclear subs wait until the last min to buy parts then expedite them because they had a 12 week lead time - they were ready to buy from an unauthorized source and I talked them out of it - they were mad at us because we did not have instant stock on them - how long did you know you were going to be building a big huge nuclear sub? I bet longer than 12 weeks!?! And now it’s my fault? Really? They just don’t plan well - that could solve almost everything. It’s not that manufacturers want more profit - we just can’t afford to support every device that has our log on it regardless if it’s ours or not or regardless of what alley in Hong Kong it came from. I had a situation where a customer was having problems with our MOSFETS - they went nuts, wanted someone there on the next fight etc.. When they calmed down a bit I had them send parts in - there they were with our logo and all but they were counterfeits - and guess what - they were bought from a non-authorized source that disappeared. I have never heard of counterfeit parts being sold via the authorized channels - for more on that see the work done by NEDA http://www.nedassoc.org/
The reason we don’t hear more about it is that when a buyer - customer etc get themselves in trouble and waste hundreds of thousands of their companies dollars buying fake stuff and it goes wrong they don’t exactly broadcast it - the problem gets swept under the rug quickly. The issue is much larger than what you hear it is - and this is just one reason why.
Rochester electronics is a good source of info as well.... if you want to sell parts to people making disposable electronics where failure is an inconvenience but it’s not going to be mission critical or threaten our safety or national security then fine but... let’s use our heads here!
Northeast Surplus has invented and patented a system to recover parts from circuit boards without damage. Bent leads, some referbishment needed. No cosmetic, static or physical damage, desoldered. Over 300,000 parts removed per week. Send in some boards 10-15 and I will run through my systems and return all for your inspecting and testing. A mother board every 9 seconds.
Exactly eemon, the goal fits 100% my opinion. If you look at
http://soltecelectronics.com/blog.aspx
you have an example on how Twitter is working, actually. I assume there are possibilities to improve in education, moving forward on value added that indipendents are bringing in the market.
Conterfeit products have many negative impacts. It is unfortunate that independent distributors are being affected like this. Is there a higher percentage of counterfeit products now compared to 5 or 10 years ago?
Well, my first question is how is Twitter working so far? Have independent distributors seen a rise in communication and general education of what companies need to look out for rather than ostracize all independents? The goal, I assume, would be to provide information and education as to how to protect against counterfeit products.
Here at EBN, we have discussed a few month ago about the adoption of twitter to promote products, services, customer care and create culture; your suggestions, eemom, are very great and interesting. In addition Dawn is active on her twitter/blog. Do you think it could a platform to use by indipendent distributors for putting thoughts on value-added, all together?
This is a very unfortunate outcome of the counterfeit products. Small, independents companies struggle as it is to compete against larger distributors. There must be a way to control counterfeit products without banning all independent distributors. This seems to be an extreme measure but perhaps the problem has grown to a level that warrants such action. Perhaps a number of the independent distributors can put their collective thoughts together to try to come up with alternative solutions to address this growing problem while helping them remain viable.
Great post Dawn; at first, let me start in giving my best wishes for the company (and business) you have founded. Going through the editorial, I was wondering if approach you have felt, could be a matter of "culture". Are we sure people have really caught value added your are bringing with your activities or lack of culture could make them still prevented? I know you are very active in twitter-blog. Basically, it could be a possible tool for outlining and broacasting real value you provided, in a sort of educational / promotional path. Maybe you won't meet against people telling you " sorry, we are not in business with indipendents".
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Join EBN contributor Jennifer Baljko on Thursday August 23, 2012, at 11:00 a.m. EST for a live chat on how electronic manufacturers in Thailand have shored up their supply chain to reduce the impact of future natural disasters.
Peter Drucker famously said "Trying to predict the future is like trying to drive down a country road at night with no lights while looking out the back window." Yet in the razor's-edge world of electronics—with a lean supply chain and just-in-time demands—the need to know the future is vital.
While no one really can accurately predict the future, we can take guidance from another Drucker saying which is the best way to predict the future is to create it.
You've heard the saying "the No. 1 supply chain risk is your people." That hasn't always been the case. But today's complex global supply chain requires a new type of multitalented employee. It's one who understands, finance, marketing, economics, is savvy with technology, graceful with relationships and can think analytically.
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