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Raising the Bar for Independent Distributors

Admittedly, when I was working on the feature story about independent distributors a few weeks ago for EBN and our sister publication, EE Times, I thought I was going to hear the same old marketing rah-rah stuff. I have to say I was proven wrong.

What I heard from many people I spoke with was that the bar has definitely been raised for independent distributors. More surprisingly, it's the independent distributors themselves who are driving expectations for higher quality component sourcing, reliable global delivery, and top-class supply chain services. All of this is good news for the entire electronics industry, particularly as the threat of buying and possibly using counterfeit parts increases. (Click here to read my story in the Top 25 Global Distributors editorial package.)

Interestingly, too, independent distributors are going about the business of improving their reputation in a methodical, organized way that very much reminds me of how franchised distributors, component suppliers, and OEMs have worked for decades.

First, they have created organizations that legitimately delineate their work from that of fly-by-night brokers. Take, for instance, the Independent Distributors of Electronics Association (IDEA), a non-profit trade association founded in 2003. Here's the “idea” behind IDEA: To provide the industry with a conduit to improve the access and sharing of information and to advance industry ethics, establish standards, and promote education.

It looks good on paper, but it's not just talk. It seems that IDEA membership now carries some weight throughout the electronics industry. IDEA's executive director Debra Eggeman told me something that was echoed by several others: IDEA membership has become a basic requirement for independent distributors to earn a place on OEMs' and contract manufacturers' approved vendor lists.

Part of this is because IDEA requires members to have, among other things, ISO 9001 certification, third-party auditing checks, and “objective evidence… of its Quality Manual that IDEA-STD-1010 is part of the company's inspection program and documented as such in their Quality Management System.” These are stringent requirements for any company in the electronics sector, and helps sift out credible companies from less-credible ones.

Next, what impressed me was the major push for industry standards and anti-counterfeiting measures that will, I think, have a significant and positive impact on the way independent distributors and OEMs interact in the future. Two standards come to mind — IDEA-QMS-9090 and SAE G-19's AS6081, both of which address open market, excess sourcing issues and were approved just today. EBN has gotten the inside scoop on it and we'll take a quick look at IDEA-QMS-9090. Next week, I'll build on this and tie in details about the AS6081 standard that's in the pipeline.

As Eggeman points out, the purpose of IDEA-QMS-9090, which is formally called Quality Management System Standard for Independent Distributors of Electronics Association Members, is “to codify a set of intensive requirements so that customers of the open/excess market may easily identify those distributors with whom they prefer to conduct business based upon expectations” in a standardized way.

Whereas the SAE G-19 AS6081, which IDEA also supports, will specifically apply to those doing business in the military and aerospace industries, IDEA-QMS-9090 addresses a broader, commercial QMS scope and aims to “establish specific requirements and practices independent distributors of electronic components can use to help ensure that they satisfy their customers' requirements” not covered in other QMS standards, Eggeman notes. Also, this standard is meant to be used in conjunction with — and not replace — ISO 9001, AS9100, and/or AS9120, which are already well-established guidelines for those in this space.

It's this kind of work that is changing the perception of independent distribution, don't you think?

For more information about IDEA-QMS-9090 or to get a copy, visit IDEA at www.idofea.org.

15 comments on “Raising the Bar for Independent Distributors

  1. prabhakar_deosthali
    May 12, 2012

    Jennifer,

     

    This looks to be the perfect platform to fight against the counterfeit parts. If only the buers from the Space and Defence agencies pay heed to check the credentials of their suppliers through such forums.

  2. SunitaT
    May 12, 2012

    IDEA membership has become a basic requirement for independent distributors to earn a place on OEMs' and contract manufacturers' approved vendor lists.

    @Jennifer, thanks for sharing this info. I am glad tha idea behind the IDEA is not just on paper but its really implemented and followed strictly. 

  3. FLYINGSCOT
    May 14, 2012

    This is all very encouraging provided the independants are all properly audited to IDEA-QMS-9090 in a way that is meaningful to customers.

  4. Barbara Jorgensen
    May 14, 2012

    Great assessment of the independent market. A couple of decades ago, it was a choice between black (indies) or white (franchised) even though the market was known as the gray market. Now, there is stratification within the indie market, and that's a good thing. It has allowed companies that truly deserve business to rise to the top. It has taken a lot of effort, but the formation of the IDEA has really helped deserving compnaies to establish “creds.”

  5. Jennifer Baljko
    May 15, 2012

    prabhakar_doesthali – I think they will… am doing a story this week about the SAE standard that specifically is aimed at this sector.

  6. Jennifer Baljko
    May 15, 2012

    triapur – yes, it does sound like they are holding themselves  to a high degree of accountability

  7. Jennifer Baljko
    May 15, 2012

    FlyingScot – If I understand correctly, it will address issues very front of mind for OEM and EMS customers. 

  8. Jennifer Baljko
    May 15, 2012

    Barbara, I agree. This does seem to be a logical next step for the whole supply chain.

  9. Mr. Roques
    May 15, 2012

    Standarization always comes at a cost… and that is that it limits innovation. For parts, you don't change over the short run but I'm thinking that companies will need to adapt to those standards and that, maybe, limits what they can do.

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