I suspect that the knee-jerk reaction by some of the heavy hitters in the electronics manufacturing and aerospace sectors to completely cut-off independent distributors from their supply chains will not last. The potential for vast revenues to be lost due to production halts and unsatisfied customers whose contracts are not able to be fulfilled will not allow this mentality to be sustained for long. (See: Don't Blame Independent Distributors Alone for Fake Parts, Part 1.)
Independent distributors offer a lot of value to the industry, and our services are widely needed. This simplistic reaction of just cutting off all the independents is what we call the "pendulum shift." When something is way out of whack, we tend to over-correct for it. Think of a pendulum swinging greatly from one side to the other. After a little while, the dust will finally settle and a happy medium will be achieved. So, what is this happy medium?
Before we get into the solution, we need to analyze the problem a little more closely. Instead of making the entire community of independent distributors a scapegoat for a global epidemic, let's get to the heart of the problem.
Many readers may be familiar with a couple of the "bad guy" distributors out there that have recently been raided by federal agents and prosecuted for knowingly selling counterfeit components to the US Government. Specifically, MVP Micro and Visiontech are companies whose seedy business practices have recently been exposed and widely publicized.
Being a veteran of the industry, I am familiar with MVP Micro and Visiontech and know enough not to buy parts from them under any circumstances. So, the question is, with all due respect: What the heck are BAE Systems plc , Raytheon Co. , and branches of the US Military doing procuring parts from these companies in the first place?
The answer is: They did not know any better. Buyers at these organizations have been charged with procuring components, and the policies and procedures at their companies or government agencies were not robust enough to differentiate a good distributor from its evil counterpart.
Education is key to countering counterfeiting. Everyone involved in the procurement of electronic components, including EMS companies, OEMs, the US Government, and independent distributors alike, need to come up with a game plan for properly evaluating potential vendors, inspecting and testing components to ensure their authenticity.
In my previous post I noted the fact that many quality independent distributors of electronic components are being lumped into one category: Bad. And many companies, including the largest defense contractors in the US, are coming up with stringent policies that forbid the purchasing of components from any independent distributor. Yet, independents provide valuable services by sourcing old and obsolete components, those with exorbitant lead-times, and other hard-to-find materials.
Without these services, manufacturers are threatened with having their entire production lines go down and being unable to get product to the market. So, obviously, a ban on independents is not a good solution. However, it is all that some companies have, at the moment, as they are grasping at straws and trying to get a hold on the fact that their supply lines have been infiltrated by sub-par materials.
Instead of manufacturers going to such an extreme measure to combat counterfeits and thus hurting their own bottom lines, there are much better solutions. In a future post, we'll suggest best-practices and some excellent resources out there for avoiding counterfeits.