Thanks to all for their contribution to the recent discussions on avoiding coutnerfeit components. We apprecaite all the feedback! Anybody with additional questions, I invite you to please join us this Thursday, July 28th, at 12:00 EST as I do a LIVE CHAT Dialogue with EBN users! Click the LIVE CHAT link on the front page to add it to your calendars. I look forward to answering any questions you may have. Thanks again for all of your feedback!
LIVE CHAT with Dawn Gluskin
What You Really Need to Know About the Open Market
"Not all non-franchised distributors are created equal. Many companies that play in the open (non-authorized) distribution market have gone to great lengths to ensure that the components they sell are counterfeit-free. In this Live Chat, Dawn Gluskin, founder and CEO of distributor SolTec Electronics, will talk about what differentiates these companies from unscrupulous open-market brokers."
Counterfeits Parts to & revered engineering Semiconductors chip you can find everywhere in China nowadays from micro controller, OTP, EER, & so on. including memory card like USB flash drive, SD, & others cards as counterfeits too (example 8GB card printed on card and when you plug in will show 8GB too but right after when you media, you will never see it again).
So do Cable & Wires as well (USB, HDMI, Ethernet RJ45, & so on). Most of the Purchasing people will never find out they are getting real/ counterfeits cables. Meaning printing our UL numbers on their none UL cable to resell to some customers that looking for lower cost due to higher cost on commodity like Gold, Copper, PVC, & so on….
Another word, seen like you are getting LV, Gucci, at bargain price but you are getting FAKE item made of cheap material….Good luck to everyone not getting counterfeits item from oversea suppliers that you don’t know….
Semiconductors chip you can find everywhere in China nowadays from micro controller, OTP, EER, & so on. including memory card like USB flash drive, SD, & others cards as counterfeits too (example 8GB card printed on card and when you plug in will show 8GB too but right after when you media, you will never see it again).
So do Cable & Wires as well (USB, HDMI, Ethernet RJ45, & so on). Most of the Purchasing people will never find out they are getting real/ counterfeits cables. Meaning printing our UL numbers on their none UL cable to resell to some customers that looking for lower cost due to higher cost on commodity like Gold, Copper, PVC, & so on….
Another word, seen like you are getting LV, Gucci, at bargain price but you are getting FAKE item made of cheap material….Good luck to everyone not getting counterfeits item from oversea suppliers that you don’t know….
You are right. Education is very important. There must be a system in place to identify, report and follow up with the bad apples. All the independent distributors have to know what they have to look for and how they can avoid the bad ones. It is a collective effort not just throwing the stone on the sectional part of the supply chain.
Thanks again for all the feedback. We are blown away by the responses we have been getting online & via messages. It's definitely a topic that many are passionate about.
tinye420 - Yes, there is definitely some amount of "one bad apple" going on here & yes, greed of a small group of people is ultimately hurting a larger group.
TaimoorZ - Absolutely. It's all about setting up the right processes & procedures which include vendor selection and component inspectiong to take steps to mitigate risks.
elctrnx_lyf - Thank you for recognizing the value added by independents. And, yes, strategic partnerships with reputable vendors would contribute to greatly reducing the occurence of counterfeits.
mfbertozzi - Yes, reputation is everything! If OEMs/CM/Government agencies align with reputable vendors only, than we wouldn't be hearing about all these issues!!!
eemom - Education is key, correct! Hopefully, this recent blog series has had some impact on educating.
As I stated in my post to Part 1, I think the key factor to moving forward is education. Independent distributors need to find a way to gather and educate the industry on how to battle Counterfeit parts. It is easier to ban all Independents but in the US, we call that throwing away the sink with the dirty water. If more education is provided on who and/or what to avoid, together with the necessity of Independent Distributors, maybe we'll find a more reasonable solution to this prevalent problem.
While final part of editorial is gone, I was wondering how to explain shortly main reasons for substain indipendents could guarantee right quality. Basically, I came back through my professional life: I've experienced indipendents have to work hard because they haven't any "logo" from major OEMs which can promote theirself. Then, the only way of achieving success and good reputation, is to put "excellence" in any internal operational process and good caring of customers during post sales support.
Without distributors, it is vey tough may be almost impossible for the OEM companies to keep their supply chain simple and to deliver the products. You can not blame the independent distributors but at the same time you can not belive that eveything coming to you is a right component. How to make sure that all is right is definitely is huge task for the OEM's. I think the right way will be to work with well known distributors in the industry till there is some effective tool to detect the counterfeiting is invented.
I think when it comes to procurement within the government and especially related to military, there has to be strict quality checking once the parts are received. No matter how reliable the distributor is, there can be no guarantee of the quality of the parts. I think the the departments within the government are also partially responsible in this case for not having effective quality control measures in place. I don't consider the entire blame on the distributors to be justified.
I would have to agree that not all idependents are to blame. There are just some greedy people in the world and some of them happen to work for independent distributors. Rather than taking a solid deal at a solid margin from a solid, trustworthy supplier they are more inclined to take a higher margin deal from a less reputable supplier because it means more money in their pocket. But this is true in any industry. The almighty dollar is very alluring. There is never going to be a way to 100% stop counterfeit parts from entering the market. Lets face it, there have been counterfeiters in the world for thousands of years. Counterfeit money, counterfeit art, counterfeit antiques, you name it. If there is money to be made off the counterfeiting of a product then the market for those counterfeits will always be there. Again, the almighty dollar (or yen) is very alluring, not just to the person selling the counterfeits but to the person making them as well.
So this problem is always going to exist in the independent distributor market unless steps are taken by the independent company owner to stop them. Unfortunately there are only two ways that I see to stop it. One option would be standard commission pay for orders regardless of the profit. If the salesman isnt going to make more money purchasing the parts at a cheaper price from a less than reputable supplier then they would be more likely to purchase them from a trustworthy supplier with the proper tracability or paperwork on the parts. The second and probably more realistic solution would have to be making the financial burden for purchasing counterfeit parts a little more harsh on the salesman. Maybe something like not only losing the commission that you would have made off the order but also an additional amount of commission loss. I know that both of these solutions put strain on the salesman but unfortunately that is where the problem really starts. Again, its all about money.
There is still going to be a need for testing parts, tracing parts, etc. But there would be less of a need for that if all companies were purchasing parts from reputable suppliers not generally known for selling counterfeit parts. But thats just my opinion.
EBN Dialogue enables and encourages you to participate in live chats with notable leaders and luminaries. Not only editors and journalists, but the entire EBN community is able to comment and ask questions. Listed below are upcoming and archived chats.
Archived Dialogues
Thailand Stages a Comeback 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.
Euro-Crisis: What It Means for High-Tech Firms Join EBN Editor in Chief Bolaji Ojo and Contributing Editor Jennifer Baljko on Thursday, July 12, at 10:00 a.m. EDT for a Live Chat on high-tech and Europe's economic difficulties.
Microsoft Surface: Potential Winners & Losers What are the implications for the electronics industry supply chain of Microsoft Corp.'s decision to launch its own tablet PC? Join industry veteran and EE Times' systems and OEM expert Rick Merritt on Tuesday, July 3, at 12:00 pm EDT for a Live Chat on this subject.
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.
Where are these people? Are universities properly preparing the next generation supply chain professionals? How do train your existing workforce for these new, demanding positions?
Brian Fuller, editor-in-chief of EBN, will lead a 60-minute Avnet Velocity panel discussion that will ask and answer these and other questions swirling around today's supply-chain talent challenges.
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