Advertisement

Live Chat

What You Really Need to Know About the Open Market

207 comments on “What You Really Need to Know About the Open Market

  1. Dawn Gluskin
    July 26, 2011

    I've enjoyed the recent discussions on this topic & look forward to answering any other questions you might have. Thank you to EBN for the invitation!

  2. khalil473
    July 28, 2011

    uuuuu

  3. Wale Bakare
    July 28, 2011

    We need to identify who are the OEM/Suppliers paticipating in the open market. How can they be identified?

  4. Nemos
    July 28, 2011

    Hello Wale, Welcome All , It is great topic. 

    (khalil473: uuuu ????? can you be more specific

  5. Wale Bakare
    July 28, 2011

    You welcome Khalil473.  I voted No to the poll anyway. who are dependent distributors?

  6. Dr. Edward F. Knab
    July 28, 2011

    Proper identification of the origins of distributor purchased product is essential, this should be a great topic for discussion.

     

    Ed

  7. Barbara Jorgensen
    July 28, 2011

    Hi Everyone

    We will be starting in about 10 minutes

  8. Ariella
    July 28, 2011

    Hello, Barbara, Ed, Wale, Nemos, and Dawn

  9. Taimoor Zubar
    July 28, 2011

    Hi everyone! 🙂

  10. mfbertozzi
    July 28, 2011

    Hello Barbara and all.

     

  11. Dawn Gluskin
    July 28, 2011

    Hello everyone!! I've just arrived.  Excited to get started. 🙂

     

  12. Jay_Bond
    July 28, 2011

    Hi everybody

     

  13. Barbara Jorgensen
    July 28, 2011

    Hi Dawn and everyone! I am so glad you could join us. We'll officially kick off in 5 more minutes.

  14. Houngbo_Hospice
    July 28, 2011

    Hi, everybody!

  15. mario8a
    July 28, 2011

    Hi

     

  16. jbond
    July 28, 2011

    Hello Everyone!

  17. prabhakar_deosthali
    July 28, 2011

    Hello everyone

     

  18. mario8a
    July 28, 2011

    Hello Everyone, Nice to meet all of you.

     

  19. Barbara Jorgensen
    July 28, 2011

    I'd like to welcome and introduce Dawn Gluskin, founder and CEO of SolTec Electronics. SolTec is a distributor that works in the open market. Our first question for Dawn: could you define the open market?

  20. elctrnx_lyf
    July 28, 2011

    Welcome Dawn .. looking forward for interesting discussion.

  21. Dawn Gluskin
    July 28, 2011

    Sure! Thank you Barbara & EBN for inviting me.  In the world of electronic components, the open market is where OEM/EMS companies are able to re-sell their excess materials to other manufacturers who need the product for current production. There are currently billions of dollars of surplus electronic materials available in the open marketplace. (As opposed to purchasing directly from the component manufacturer or franchised source).

     

  22. AnalyzeThis
    July 28, 2011

    Thanks in advance to Dawn for taking the time to chat with us!

     

  23. Barbara Jorgensen
    July 28, 2011

    Dawn, could you explain a little bit about your business model and how it differs from traditional, authorized channels?

  24. Houngbo_Hospice
    July 28, 2011

    @Dawn: Have your ever dealt with a crooked component suppler? if yes how did you handle that?

  25. Nemos
    July 28, 2011

    Hell again, Open or free market is it the same ?

  26. Nemos
    July 28, 2011

    *hello

  27. Taimoor Zubar
    July 28, 2011

    @Dawn: What are the legal implications of operating in an open market? What are somethings that are illegal and what are the ones that are not?

  28. DataCrunch
    July 28, 2011

    Hello Everyone!

  29. elctrnx_lyf
    July 28, 2011

    Is there any other distributors like solectron?

     

  30. Dawn Gluskin
    July 28, 2011

    Absolutely, Barbara – SolTec Electronics is an independent distributor of electronic components.  Our clients come to us when they can not find the parts needed for their production (obsolete parts or long lead-times, for example).  We are able to go into the open market & find the exact part they need, or some other alternative that might work in their application.  We also have a subsidiary, SolTec Labs, where we are able to detect and avoid the counterfeit problems.

     

  31. Barbara Jorgensen
    July 28, 2011

    Hospice–your question is a good one to set up our next question to Dawn: why do some companies see the open market as risky?

  32. Ariella
    July 28, 2011

    Hi, Dave, some questions were already posed to our presenter

  33. prabhakar_deosthali
    July 28, 2011

    @Dawn when somebody sells in the open market do they carry forward the original warranties to the purchaser?

  34. Houngbo_Hospice
    July 28, 2011

    Thanks Barb!

  35. bolaji ojo
    July 28, 2011

    Hi Everyone, In order to maximize the use of Dawn's time, some of the more general questions will be answered by EBN editors Bolaji Ojo and Barbara Jorgensen. (Any other specialists online welcome). We'll prefer for Dawn to focus on the more substantive and engaging questions.

     

  36. Barbara Jorgensen
    July 28, 2011

    @Nemos–yes, the open market and the free marekt are the same, it works somewhat like the stock market

  37. Anna Young
    July 28, 2011

    I believe the term Open Market might also tend to have a negative connotation to it. This shouldn't be the case but it is currently. Part of what needs to happen is the legitimization of the so-called Open Market. Is that possible considering (1) the negative image and (2) the tendency on the part of some other players in the industry to prefer to stick participants in the Open Market with the negative image because it works in their favor?

  38. Ariella
    July 28, 2011

    @Dawn do you have a data base of what companies have available, or do you have to approach each on individually to ask for what is needed?

  39. Dawn Gluskin
    July 28, 2011

    Hospice_Houngbo  – Unfortunately, yes, as I've been involved with this industry for over a decade.  However, at SolTec, we have very strict AVL (approved vendor) policies in place to keep the “crooked” ones off our list.  We also protect ourselves by testing and asking for net terms or escrow.

  40. mfbertozzi
    July 28, 2011

    @ Barbara/all: I was wondering how Internet services could help in better qualifying non-franchise distributors and allow them in reaching right outstanding.  Once community's discussion is gone, maybe Dawn could report to us her experiences.

  41. Wale Bakare
    July 28, 2011

    @Ariella good question!!!

     

  42. bolaji ojo
    July 28, 2011

    Ariella, I don't believe any one single company has information on everything that is available through the Open Market. In many cases, this is a competitive advantage information and companies may prefer that a potential buyer visit their websites or call them directly. That's part of the dynamics of the Open Market.

  43. Dawn Gluskin
    July 28, 2011

    @Barbara – Some view the open market as risky because there is not always traceability back to the original component manufacturer.  Since the electronics industry can be lucrative, counterfeiting is a huge concern.  However, these risks can be mitigted with proper proecedures and testing in place

     

  44. Ariella
    July 28, 2011

    @Wale, thanks. We'll see if it makes the cut as worthy of answer in prime time.

  45. Barbara Jorgensen
    July 28, 2011

    @electrynx

    Do you mean Soltec? If so, yes, other companies with the same meodel include America II, Smith and Associates, and Advanced MP

  46. Barbara Jorgensen
    July 28, 2011

    Dawn, I think this is an important distinction. Please share with us some of those measures.

  47. Ariella
    July 28, 2011

    @Bolaji, then it would not work, say, like Amazon, which is a portal to various suppliers or even MLS, which brings together listings from various realtors. 

  48. Anna Young
    July 28, 2011

    Dawn, If traceability is key to “legitimacy” why don't all independent distributors offer this or is this impossible?

  49. Dawn Gluskin
    July 28, 2011

    @Ariella – are you referring to a parts database or supplier database?  In either case – Yes!  We have a massive database full of supplier and part date.  Knowledge is power in doing our jobs over-the-top well.

     

  50. Barbara Jorgensen
    July 28, 2011

    @prabhakar: In general, the warranty does not carry through in the open market

  51. mario8a
    July 28, 2011

    Hi Dawn, thanks for the opportunity of learning more ab out this topic.

    My question is in regards to new leagislations coming up every year for environmental and certification compliance on components, let say RoHS compliance, if Soltec bough a component before 2006 if should not meet RoHS, so now in 2011 it will be a risk to use, how Soltec is preventing for future legisaltions in EU or North America?

  52. prabhakar_deosthali
    July 28, 2011

    @Dawn In the data base for the parts inventory do you kepp the traceability info?

  53. elctrnx_lyf
    July 28, 2011

    How is this business model different from the normal distribution business? Is open market more prone to counterfeiting compared to the normal distribution chanells?

  54. Taimoor Zubar
    July 28, 2011

    @Dawn: Since you have a database, do you also have a web portal where buyers can search for suppliers? I guess that would be an important feature to have.

  55. Ariella
    July 28, 2011

    @Dawn, thanks for answering. Absolutely, having that database allows you to find what your customers want right away, and timing is also key to business.

  56. mfbertozzi
    July 28, 2011

    Other question from side is about technologies for traceability.
    Do you think RFID and in the near future 6LowWPAN could enforce tasks in charge of distributors?

  57. Dawn Gluskin
    July 28, 2011

    @Anna young – oftentimes, when excess materials are sold, the CofCs do not go along with it.  So, typically, excess material does not have the traceability.  This dove tails nicely into Barbaras request to go into some of the risk mitigation.  The main ones: align with reputable vendors (with quality certs in place and good reputation — check references), and make sure the components are properly inspected and tested to identify potential QC failures.  There are different levels of testing available, depending on end-user.  For example, Military/Aerospace tend to require full-functional testing when traceability is not available, whereas consumer electroncis might have some lower level testing, such as curve trace.

  58. bolaji ojo
    July 28, 2011

    Ariella, There are outlets that offer extensive information on what is available in the market. However, for the Open Market this would be more difficult. I don't believe any one company would want to stand up and vouch for the information and parts being hawked by all participants in the sector. If this happens and you vouched for a counterfeit part you would then be liable. Of course, the industry organizations that Dawn discussed in her blogs have certified members and this may be a starting point. For other sources, I would suggest looking at third-party companies such as datasheets.com, a service that I blogged about today. It's one of the more credible sources out there although they primarily represent suppliers and franchise distributors.

  59. Barbara Jorgensen
    July 28, 2011

    @electrynx: I can answer that one. Suppliers franchise authroized distrbutors to resell their products which means that the manufacturer's warranty carries through. In order for suppliers to back their product, they want to be able to trace it back to the original source, that being the factory. Once something is sold in the open market, that traceability becomes difficult

  60. prabhakar_deosthali
    July 28, 2011

    @Dawn how do you ensure that the parts which have exhausted their shelf life ( e.g electrolytic capacitors) are automatically removed from your inventory data base?

     

  61. Dawn Gluskin
    July 28, 2011

    @Taimoorz – Absolutely!  You can search our database on http://www.soltecelectronics.com – which shows all the parts available in our warehouse & through our vast supply chain network. You can also submit an RFQ online, or contact us directly with special needs.

  62. Nemos
    July 28, 2011

    How the counterfeit parts affect the open market and what solution suggests your company ?

  63. Dawn Gluskin
    July 28, 2011

    @prabhaker – Yes, we keep very detailed receiving records including photographs of packaging & parts, lot & date code information, and CofC (traceability) when available

  64. Ariella
    July 28, 2011

    @Bolaji, of course it wouldn't be possible to cover every single part available unless everyone who has such parts registers it in some way that is accessible. But I should think for Dawn's business, it would make sense to keep an updated data base on the companies she deals with and their stock in order to be able to find what is needed quickly. 

  65. Barbara Jorgensen
    July 28, 2011

    It is true that counterfeit parts enter the open market becuase the buying and selling is often done online and there may not be longterm relationships established between suppliers and component buyers. However, counterfeits have also cropped up in the authorized channel through product returns. This is why the traceability aspect is so important to suppliers

  66. Anna Young
    July 28, 2011

    Dawn, I noticed the question asked by Ariella. Does the industry have an outlet that offers a general database of all available inventories through the Open Market? SolTec's database may be available and searchable but does it link to other sources or is this limited to data on SolTec's inventory?

  67. Taimoor Zubar
    July 28, 2011

    @Dawn: On average, how quickly are you able to get back to the buyer once he submit a requests for parts? Does it depend on the kind of parts the buyer has requested? In many cases, the time factor is very critical I guess especially if the buyer has pending orders.

  68. Barbara Jorgensen
    July 28, 2011

    Dawn, you pointed out in one of your blogs that a few bad brokers have hurt the reputation of independents in general. Do you think the independent channel is chaging for the better?

  69. mario8a
    July 28, 2011

    Hi Dawn

    Earlier you mentioned you have AVL, how many part numbers are approved in Soltec database (APL)?

  70. Dawn Gluskin
    July 28, 2011

    @nemos – Yes, counterfeits are a huge industry concern.  My company has invested heavily in test equipment, qualified personnel, and obtaining quality certifications as part of our due diligence to keep counterfeits out of the supply chain.  We also offer our testing services through SolTec Labs to our competition so that they also have tools available to them to keep sub-par materials out of the marketplace

  71. elctrnx_lyf
    July 28, 2011

    So the responsibility of anti counterfeiting lies with open market distributors like Soltec. Does it incur a lot of expense to achieve this?

  72. bolaji ojo
    July 28, 2011

    Ariella, Absolutely. I agree. Most companies, SolTec included, have information on their parts. As Dawn noted, this is available and searchable. I assumed you were asking about all available-to-sell inventories in the Open Market. That's what I referred to as being extremely difficult.

  73. DataCrunch
    July 28, 2011

    I recall several years ago when RFID was all the rage, there was talk about master product databases to combat counterfeiting.

  74. Houngbo_Hospice
    July 28, 2011

    @Dawn: on your website we can read “Zero Counterfeit Policy upheld with our in-house Test Lab “. Do you test every components before purchasing? I wonder how easy this could be.

  75. Dawn Gluskin
    July 28, 2011

    @anna young @mario8a – I dont have an exact count, but we have well over a million unique part numbers in our database.  This includes parts on our shelves as well as parts available to us through our approved supply chain network.  We work closely with hundreds of vendors from all over the world

  76. mfbertozzi
    July 28, 2011

    @Barbara/Bolaji: do you think cloud services (discussed recently here at EBN community) can improve distributors tasks for instance in the integration of proprietary DBs with shared info?

  77. Barbara Jorgensen
    July 28, 2011

    @Dave–there used to be a website where compaines could post notices about counterfiet parts. The last time I tired it is was subscription-only. I think an organization of independents, the IDEA, is trying similar measures

  78. DataCrunch
    July 28, 2011

    The pharma industry has been implementing ePedigree solutions on certain products, but compliance continues to be pushed out every year.

  79. prabhakar_deosthali
    July 28, 2011

    @Dawn When you offer testing services for the parts , do you carry out the same tests as per the original manufacturers test data?

  80. Anna Young
    July 28, 2011

    Dave Sasson, RFID may solve the problem of counterfeiting but it would only be a matter of time for someone to counterfeit the RFID tag itself! There are fake Apple stores in China right now as Barbara warned in one of her more recent blogs. Counterfeiting will always be a problem. Companies like SolTec just have to be one step ahead and stay on the alert all the time.

  81. Susan Fourtané
    July 28, 2011

    Hello, sorry I'm late -problems with a plug-in and this link. 

  82. Ariella
    July 28, 2011

    @Bolaji, yes I meant only for a large enough number of supplies and suppliers to find matches more quickly. Covering everything is virtually impossible. Not every retailer works with Amazon, though many do. 

  83. Ariella
    July 28, 2011

    Hi, Susan

  84. DataCrunch
    July 28, 2011

    @Barbara – Yes, I can't remember the name, but I believe IBM was getting into this field as well.

  85. Barbara Jorgensen
    July 28, 2011

    @mfrobertazzi–that is exactly the kind of use the cloud is intended for. Right now, most inventory information is shared through proprietary links. There is no one database that everyone can access. That said, the cloud seems risky to me

  86. Wale Bakare
    July 28, 2011

    @mfbertozzi private cloud may be diffcult but with public and hybrid i think very possible.

  87. Houngbo_Hospice
    July 28, 2011

    Welcome Susan

  88. Nemos
    July 28, 2011

    Why my company to choose a company from the open market as a part distributor ?  what are these characteristics what do a company like yours attractive ?

  89. Taimoor Zubar
    July 28, 2011

    @Anna: The technology to fake RFID tags is already there. But it's very expensive to use it and requires huge investment in equipment.

  90. Susan Fourtané
    July 28, 2011

    Hi, @Ariella, @Hospice:thanks

  91. Dawn Gluskin
    July 28, 2011

    @electrnx-lyf @hospice-houngbo – Yes, it is costly to open up a testing facility, which is likely why not all independent distributors are willing/able to do so.  However, the investment pays off in customer retention and loyalty when they know they have a partner that can get the hard-to-find parts they need, without the worry of counterfeits. 

  92. Nemos
    July 28, 2011

    HEllo Susan  (quick time plug in problems ?)

  93. Ariella
    July 28, 2011

    @Barbara interesting b/c I'm working on a blog about a knowlege base (more comprehensive than a data base) that is being put together by scientists with cloud technology. I hope to learn more about how they agreed to use a cloud for it.  

  94. Barbara Jorgensen
    July 28, 2011

    @Nemos–independent distbutros are also known as the “spot market” which means they often have inventory available to ship right away, whereas a franchised distributor may quopte a leadtime. Or an independent will find what you need. This is why they are attractive to buyers, especially when buyers are in a pinch

  95. Susan Fourtané
    July 28, 2011

    @Dawn: what would you say is the ROI of the investment? 

  96. mario8a
    July 28, 2011

    I wonder how Soltec manages their Field Returns department, is the original manufacturer accountable? and how fast will respond when the exact component is not longer available.

    is this a topic for Soltec related to customer sustaining issues?

  97. DataCrunch
    July 28, 2011

    Properly implemented tack and trace solutions can potentially decrease counterfeiting significantly. 

  98. AnalyzeThis
    July 28, 2011

    @Dawn, I have a question about obsolete parts… how obsolete do you get? Have you ever received a request which was just impossible to track down due to advanced age?

  99. Barbara Jorgensen
    July 28, 2011

    @Ariella–anything you can tell us would be helpful. I'm still a cloud-neophyte 🙂

  100. Houngbo_Hospice
    July 28, 2011

    @Dawn: You should be one in the huindreds to do so. It is good to hear that!

  101. Anna Young
    July 28, 2011

    Dawn, If Independent Distributors should have testing facilities to detect counterfeits, are franchise distributors obliged to do the same or do we all assume fake components cannot enter the supply chain through the big franchise distributors?

  102. Susan Fourtané
    July 28, 2011

    @Nemos: Yes, quick time plug-in 7.6.9 exactly. 🙁 

  103. AnalyzeThis
    July 28, 2011

    @mario8a, that's something I was wondering about too…

     

  104. mfbertozzi
    July 28, 2011

    @TaimoorZ: you are right, RFID achieved a limited success due to costs. What about new technologies for traceability?

  105. Dawn Gluskin
    July 28, 2011

    @nemos – It always comes down to quality & service.  We care about our clients & there problems are ours to solve.  Part one is finding the parts that they need to keep their production line up. Part two is to make sure the parts we find are authentic and without quality concerns.  That is where we provide the most value

  106. DataCrunch
    July 28, 2011

    True there will probably always be a way to find ways around this, but even a minor reduction in counterfeiting could add up to a lot of $$$ in for companies.

  107. Dawn Gluskin
    July 28, 2011

    Wow, so many quetions.  I love it!!  Please excuse any I missed or any typos.  Going back to try to answer all & typing as fast as I can over here!!! 🙂

  108. Barbara Jorgensen
    July 28, 2011

    @mfbertozzi and Taimoor: there are materials that can be embedded or can coat products with unique identifers. But these are also expensive. Another technology the indsutry is looking is is holograms

  109. Barbara Jorgensen
    July 28, 2011

    Dawn–dont worrry about the typos–i m the worst

  110. Ariella
    July 28, 2011

    @Barbara I am really far from being an expert on this. But the idea is to have vast amounts of data (particularly about plants) in the cloud to serve as a type of Google for scientists. 

  111. Ariella
    July 28, 2011

    Typos are always forgiven in chat — no way to edit here anyway

  112. mfbertozzi
    July 28, 2011

    @WaleBakare: right, I'm with you; opportunity trade off could bring considerable advantages. Going further, cloud potentially avoids to invest in common platform, leaving CAPEX and OPEX for proprietary plats and more focused on corporations' mission.

  113. bolaji ojo
    July 28, 2011

    Dawn, You mentioned in a previous blog how some parts of the industry have written off independent distributors. They refuse to do business with them no matter what. If this remains the case winning customers would be extremely difficult. I realize your company is finding a way around this but what else needs to be done on an industrywide basis, after all we can't just completely take indies out of the supply chain?

  114. Wale Bakare
    July 28, 2011

    RFID integrate with sensor and datalogger on every part or components in open market may be another option.

  115. Barbara Jorgensen
    July 28, 2011

    @Ariella–I think that is a great idea. So much info is stored away in labs or universities.

  116. Dawn Gluskin
    July 28, 2011

    @anna yougn – Great question!!  While I have never personally received a counterfeit part from a franchised source, there are many documented cases of this happening.  The way this takes place is when a “crooked” buyer buys from franchised and then requests a return.  Typically, franchise will just put them right back on the shelf without any incoming QC inspection.  Therefore, there have been cases of good parts switched out for bad & then put back on the shelf.  Absolutely, even franchise distributors need to put some measures in place to prevent this from happening.

  117. mario8a
    July 28, 2011

    Hi Dawn, I can't imagine how can you read questions and answer at the same time in this short period of time.

    if there's a room between the questions, could you please share a succesful or challenging story in your time at Soltec?

  118. Susan Fourtané
    July 28, 2011

    @Ariella: Interesting. I am working on one about software for plant and flower recognition. They may complement themselves. 🙂

  119. Dawn Gluskin
    July 28, 2011

    @Bolaji – Unfortunately, yes that has been the case with some major OEM companies. They are so frustrated with receiving bad components that they have completely banned purchasing from independents.  I believe that this will be a temporary ban as they really can't thrive without independents.  Parts are constanly going obsolete due to advancing technology and a board re-design takes a lot of time & money.  I think they are taking some time to evaluate thier current procurement processes.  Once they get a handle on it, they will be back to buying from the open market.  I think it is SO important to practice safe procurement.  When buyers take quotes at face value and dont do enough research on the company quoting and/or have parts tested — that's when the trouble happens.

  120. bolaji ojo
    July 28, 2011

    Just your luck for dealing with a very engaging subject and for having a group of ardent participants!

  121. Barbara Jorgensen
    July 28, 2011

    Dawn, your example is spot on. In one case, a franchised distrbutor took returns from a customer and discovered they were counterfeit. Now, this distrbutors does much of the same testing you cite on its returns. That kind of situation adds expenses throughout the channel

  122. Susan Fourtané
    July 28, 2011

    @Dawn: my question was about ROI, I can copy again for you if you missed it.

  123. Ariella
    July 28, 2011

    @Susan, perhaps that would develop to the point at which you could point your smart phone at a plant and it will tell you its name — both scientific and standard.

  124. elctrnx_lyf
    July 28, 2011

    Other than the crooked buyers switching the parts with the faked ones while returing, what are the otherways does the counterfiet components enter into the distributors shelf? More than this I'm quite curious to know about who makes these fake components and what sort of infrastructure does this crook companies?

  125. Susan Fourtané
    July 28, 2011

    @Ariella: Something like that. It's an iPhone app.

  126. mfbertozzi
    July 28, 2011

    @Barbara: (holograms) question is how long it takes for developing that path and allows at cheap prices the availability of services.

  127. Ariella
    July 28, 2011

    @Susan great on nature walks

  128. Dawn Gluskin
    July 28, 2011

    @Susan – do you mean the ROI on the testing capabilities?  I can't really put a dollar amount on it, but we have tons of clients that purhcase all of their obsolete and lead-time parts through us exclusively.  They have been burned so many times by competitors that they are ecstatic to find someone that is in their corner protecting them.  We provide very detailed lab reports of all incoming parts & notify the clients of any concerns.  This has helped us to keep our head above the water, even in a slow economy and with the (likely temporary) “independent ban” that is happening at some big corporations.  It's all about relationships & those are built on trust!!

  129. Barbara Jorgensen
    July 28, 2011

    @electrynx I can take that one. Many counterfeits are factory rejects that are stolen and repackaged. Then they are sold to an OEM, EMS or to the open market. In other cases, counterfeiters set up their own “storefront” online and advertise parts for sale. Some contact you directly–I even get those in my e-mail

  130. Taimoor Zubar
    July 28, 2011

    @mfbertozzi: Every measure to protect counterfeits will ultimately be cracked. The key to ensuring protection is to constantly update your technology after every few years.

  131. Nemos
    July 28, 2011

    Can I  buy parts from SoItec Electronics as and independent or you are selling parts only  to companies ?

  132. prabhakar_deosthali
    July 28, 2011

    @Dawn Do some of the authorised distributors pass on their enquiries to you when they have no inventory of those parts ( probably becaus ethe parts are out of circulation from the manufacturer)

  133. Anna Young
    July 28, 2011

    Dawn, One continuing puzzle for me has been the relationship between franchise and non-franchise distributors. It's almost like we delegitimize one in other for the other to stay dominant. Yet, don't franchise distributors use independents to sell products when cleaning out their inventories? In other words, there's a role for the two. Isn't this the case?

  134. Ms. Daisy
    July 28, 2011

    Dawn;

    Do you know of any form of self regulation or association that binds the independent distributors and how has this association helped to give legitimacy to the group which I am hoping your company belongs?

  135. Barbara Jorgensen
    July 28, 2011

    @mfbertozzi There is a German company that is currently doing this, but I belive the equipment is still in the multi-millions of dollars. The problem with compoennts is you really need to mark evey individual part like this, and it is not affordable. Then, users have to invest in equipment to read the holograms. The system quickly is priced out of reach for small business

  136. Dawn Gluskin
    July 28, 2011

    @electrnx-lyf – the origination of the counterfeits is due to unregulated e-waste disposal (old computers, TVs, etc). This electronic waste is shipped over to 3rd world nations, such as Shenzhen China, which is very impovershed.  They have elaborarte counterfeiting operations where they pull chips off of old boards, remove old marking, and basically paint new markings on top. It's crazy!  Regulating e-waste must happen to eliminate the issue. In the meantime proper part testing and verification are MUSTS!

  137. Barbara Jorgensen
    July 28, 2011

    @prabhakar and Anna: Franchised distributors do indeed buy and sell from independents. They do not advertise this, but it does happen.

  138. Susan Fourtané
    July 28, 2011

    @Dawn: Thanks. That's right. Clients certainly value the trust they can have in your, especially these days when corruption is a common coin in some many places. 

  139. Dawn Gluskin
    July 28, 2011

    @nemos – Yes, we sell to other indpendents as well as OEM/EMS clients.  We offer our lab services to indepndents as well

  140. Houngbo_Hospice
    July 28, 2011

    @Dawn: In his blog   “Pay No Attention to That Man Behind the Curtain…”, Michael Wood      concluded with the sentence “At the end of the day, a $20 “Rolex” is never the real thing. “. Can counterfeit components be sometime determined/known by its price? 

  141. mfbertozzi
    July 28, 2011

    @Barbara: (holograms) …then are you meaning “Internet of Things” and very cheap sensors based on 6LowWPAN could fit right solutions (potentially) for traceability 😉

  142. Anand
    July 28, 2011

    @Barbara Which german company?

  143. Barbara Jorgensen
    July 28, 2011

    @hospice: one of the reasons brokers are unpopular is becuase they often offer compoents below market price, or when parts are in short supply they raise prices astronomically. Buyers can justify the cost becuase it is cheaper than keeping a manufacturing line idle

  144. Dawn Gluskin
    July 28, 2011

    @prabhakar – Unfortunately, not so much.  Many authorized sources go on campaigns to discourage buying from independents, so they're not likely to pass on leads (although, it would be a great benefit to their client to know of a reputable independent source.  They are going to go into the open market anyway – might as well make sure they are protected)  At the end of the day, it really boils down to market share, although they will give a variety of other reasons.  I think there is plenty of market share to go around and we should all work together in the best interest of the industry and all involved

  145. mario8a
    July 28, 2011

    Testing components 100% I think will be a challenge if the components are protected or still in “reel” package, will more expensive tu un-package and re-package again? even more if vacuum is required

  146. prabhakar_deosthali
    July 28, 2011

    I beileve , with the miniaturization of parts marking individual parts with holograms will be difficult

  147. Barbara Jorgensen
    July 28, 2011

    @mfbertozzi–not sure. That's above my technology level.

  148. Houngbo_Hospice
    July 28, 2011

    @Barb: I see!

  149. SunitaT
    July 28, 2011

    @prabhakar I agree with you…it would be very difficult

  150. Susan Fourtané
    July 28, 2011

    @All: does anyone know what is the future of e-waste? 

  151. SunitaT
    July 28, 2011

    @Susan what do you mean by future of e-waste ?

  152. Nemos
    July 28, 2011

    the future of e waste will be the authorized companies to do the job

  153. Houngbo_Hospice
    July 28, 2011

    @mario8a: There is never a 100% certainty. But with testing you can mitigate the risks

  154. mario8a
    July 28, 2011

    Susan, do you mean WEEE ? (waste of electronic and electrical equipment)

  155. Barbara Jorgensen
    July 28, 2011

    Dawn: is the environment more difficult than it has been in terms of franchised distrbutors discouraging the open market?

  156. bolaji ojo
    July 28, 2011

    Dawn, It seems you are concluding that in order for the system to work and for companies to avoid counterfeits, the OEMs and contract manufacturers have an obligation to ensure proper credentials of their supply partners who should probably indicate they are 100 percent sure the parts are not fake. But wouldn't this mean 100 percent verification of all parts? Is this possible in the industry considering the milions of components shifted around everyday? I can only imagine the added costs to pricing.

  157. Nemos
    July 28, 2011

    @mari8a yes

  158. Dawn Gluskin
    July 28, 2011

    @anna young – great point!  I think franchise distributors see independents as a threat, but it's difficult for me to understand why?  In my client realtionships, we position ourselves as a supplemental supplier – to fill in the gaps when franchised cannot deliver — not to take place of that relationship.  However, one of my reps actually had somebody from a major component manfucturer tell her at a networking event “you are taking food off my kids plate” because she sells to his client when he can't deliver parts.  What does he expect his client to do?? Sit there with his line down while waiting an exorbitant lead-time??  He would go out of business, if so.

  159. SunitaT
    July 28, 2011

    @Susad, I guess most of the e-waste is exported to developing nations

  160. prabhakar_deosthali
    July 28, 2011

    e-waste should be destroyed the way the old cars are destroyed by the crunching machines.  In the attempt to recover some costs out of this e-waste , the counterfeit business has flourished.

     

  161. mario8a
    July 28, 2011

    I'm sure the reel is not tested 100% but according to Dawn they test 100% APL or every part number, still I think it will be cumbersome.

  162. SunitaT
    July 28, 2011

    And extraction of and recycling of elements is done in most of the developing nations.

  163. Dawn Gluskin
    July 28, 2011

    @mario8 – Not so much — we have a vaccuum sealer & reeling machine, which allow us to inspect parts on a reel and then re-seal them to be shipped.

  164. Barbara Jorgensen
    July 28, 2011

    Bolaji–that is a great point. Not only that, but all this testing creates redundnacies int he channel as everybody is testing. the same stuff This adds expense for everybody

  165. Susan Fourtané
    July 28, 2011

    @prabhakar: “with the miniaturization of parts marking individual parts with…” –you could use a 3D printer?

  166. Taimoor Zubar
    July 28, 2011

    @Bolaji, I was also wondering about it. How is it possible to ensure 100% quality checks on the entire shipment.

  167. SunitaT
    July 28, 2011

    Most of the Computer equipment manufacturers that offer “take back” programs export it to developing nations.

  168. prabhakar_deosthali
    July 28, 2011

    @Susan I am not sure !

  169. mfbertozzi
    July 28, 2011

    @Dawn: have you specific people for DB design, development and maintenance? How big is % of time for an outstanding distributor to dedicate at IT infrastructure?

  170. Dawn Gluskin
    July 28, 2011

    @Barbara – I know that this sort of fight for market share has been going on for many years now.  It does seem like some of the component manufacturers have been more agressive in recent times by forbidding their products to be sold to an independent distributor, for example.  Perhaps it is just a sign of the times and the economy?  I'm not sure.  But, again, independents will never be eliminated. Our services are too valuable and widely needed.  I wouldn't mind, however, if some of the “bad apples” were seeded out.  That's what really needs to happen

  171. Nemos
    July 28, 2011

    Dawn it is easy to detect a reused part ? do you use x-ray equipment ?

  172. Barbara Jorgensen
    July 28, 2011

    @TaimoorZ: The fact is, it can't. Most components are tested in lots–evry fifth part is tested–once it leaves the factory. I believe component makers test every single part, which is how they guarantee perfromance.

  173. bolaji ojo
    July 28, 2011

    Just crushing out-of-service electronics equipment is not an option, either. Proper disposal under appropriate regulatory supervision is key. The environment will suffer greatly if we just crush, dump and bury. It's not an option. The current system is not the greatest and should be improved but it cannot just be swapped for a worse system.

  174. SunitaT
    July 28, 2011

    @Barbara, I agree with they use random sampling technique

  175. Barbara Jorgensen
    July 28, 2011

    DAwn: This is how I see it: forecasts will never be perfect, so there will always be excess and shortages. Independents provide a service for the movement of these products. It is a fact of doing bsuiness, and has been for as long as I've covered the market

  176. Dawn Gluskin
    July 28, 2011

    @Bolaji – yes, it is true that OEMs need to ensure credentials of their supply chain vendors.  Most independents have access to the same materials (more or less).  So, for example, if an OEM has 5 reputable vendors that they work with & none of them can find the stock & then another vendor comes out of the wood work with parts — they should be very cautious.  Pretty much any part number can be “painted” in China.  OEMs should keep that in mind when procuring in the open market.  If something seems to good to be true, it probably is.  Aligning with reputable vendors and avoiding the temptation to go with some new/unknown vendor out of desparation of parts is more along the lines of what I am suggesting.

  177. bolaji ojo
    July 28, 2011

    I there are no hot questions, I would like us to give Dawn a pause to answer some of the outstanding questions.

  178. SunitaT
    July 28, 2011

    Most of the e-waste containts precious elements like Gold, I think gold above 1600$ makes people reuse e-waste

  179. mario8a
    July 28, 2011

    @Dawn

    it's very interestng your point of view about how independent suppliers should be considered in the bussiness model, however in order to “be there when you are needed” should be required to have a good inventory available, what would you say, a ballpark calculation of your inventory turns per year?

  180. prabhakar_deosthali
    July 28, 2011

    extracting gold or silver is alright but the semiconductors is where old parts can be used for counterfeits. They need to be destroyed before they fall into the wrong hands

  181. Anna Young
    July 28, 2011

    Dawn, You've been awesome. Thank you for not shying away from answering even the more probing questions.

  182. Barbara Jorgensen
    July 28, 2011

    To our awesome audience: thank you for your participation in this discussion–this has been a teriffic discussion, extremely educational and professional. I also want to thank Dawn for her time. We have to stop exactly at 1 today, but I invite you to contact me through the home page for follow up questions or comments. You can also reach Dawn by posting on her blogs.

     

  183. Nemos
    July 28, 2011

    thank you all for this amazing conversation and specially to Dawn for his patience to answer all the questions.

  184. SunitaT
    July 28, 2011

    @prabhakar How is counterfeit related to e-waste ?

  185. Barbara Jorgensen
    July 28, 2011

    Dawn, thanks so much for your time. This is extremely valuable for our audience. And thanks to our participants again!

  186. Taimoor Zubar
    July 28, 2011

    It was a very useful discussion. Thank you Dawn for your time and thank you EBN editors for conducting this live chat.

  187. Dawn Gluskin
    July 28, 2011

    @nemos – there are many techniques for identify a reused/remarked part.  The first step is visual (we follow the IDEA-1010B inspection standard) — with the use of a high powered microscope, you can see evidence of sanding.  A chemical part-marking permanecny test can identify when a part surface has been re-marked.  (For example, an acetone swipe will tell this on some components — the marking will wipe right off!)  It does not work on all surfaces, though.  We use other chemicals for advanced detection.  Also, our technicain is able to open up a chip via etching with acid & expose the die inside. Through metallurgical scope, he can view the die markings.  Yes, x-ray is a good way to inspect a large batch and make they all look identical inside.  Electrical testing is the final step.  We do fucntional testing on many parts and also pinprint analysis compated to a know good device.

  188. mfbertozzi
    July 28, 2011

    Thank you all and thanks to Dawn/Barbara/Bolaji for your time.

  189. Anand
    July 28, 2011

    Thanks Dawn…and thanks Bolaji/Barbara for arranging this chat…very informative

  190. prabhakar_deosthali
    July 28, 2011

    As they say, in China any old part can be printed with new part number and sold in the open market

  191. prabhakar_deosthali
    July 28, 2011

    Thank you all and Thank Dawn

  192. SunitaT
    July 28, 2011

    Thanks dawn. It was a great discussion.

  193. Susan Fourtané
    July 28, 2011

    @Dawn, @Bolaji, @Barbara: Thanks for this. Great discussion and lots of information. I am still reading some of the comments. 

  194. Dawn Gluskin
    July 28, 2011

    Thank you guys for having me!!  My head is spinning from all the questions flying out & my fingers hurt from typing so fast (LOL), but, as you can probably tell, I'm very passionate about the subject and have enjoyed every second of it! 🙂

  195. SunitaT
    July 28, 2011

    @prabhakar, I got your point. thanks for the clarification.

  196. Houngbo_Hospice
    July 28, 2011

    @Dawn: My last question: Which parts of the world are your customers located?

  197. mario8a
    July 28, 2011

    @Dawn, @Bolaji, @Barbara THANK YOU

  198. Nemos
    July 28, 2011

    thanks Dawn, Bye to all, see you soon

  199. SunitaT
    July 28, 2011

    @Hospice, thanks for that question…I too had similar doubt

  200. Dawn Gluskin
    July 28, 2011

    For anybody that has further questions, I invite you to connect with me in any way you like! 🙂

    email:

    Phone: 321-684-4419

    Web: http://www.soltecelectronics.com

    Twitter: http://www.twitter.com/soltecelec

    LinkedIn: http://www.linkedin.com/dawngluskin

    OR – Feel free to post any unanswered questions in one of my recent blos & I'll be happy to answer it. Thanks again. I enjoyed this!! 🙂

  201. Houngbo_Hospice
    July 28, 2011

    Thanks, Dawn!

  202. Susan Fourtané
    July 28, 2011

    Thanks, @Dawn!

  203. jbond
    July 28, 2011

    Thank you Dawn

     

  204. Jay_Bond
    July 28, 2011

    @dawn thanks

  205. mario8a
    July 28, 2011

    Great discussion about Open Market.

  206. Susan Fourtané
    July 28, 2011

    test

  207. Edmunds Sinevics
    July 28, 2011

    I think and hope, that you will agree, that the whole electronic industry would benefit, if franchise distributors work with independent distributors. How do we get?

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.