How to Protect Your Supply Chain During Times of Economic Uncertainty

supply chain

Even at the best of times, the electronics manufacturing sector is highly competitive. Bottlenecks in the supply chain that prevent shipments of components such as Nexperia bipolar transistors and diodes can affect on-time delivery and can quickly snowball into significant financial loss and customer discontent. When uncertainty levels are high, businesses need to do all they can to shield their supplier networks from the worst.


As a manufacturer of complex products, you already know that many raw materials producers, vendors and third-party entities are involved in bringing the final product to the consumer. In an age where a weakness in even a distant link in the chain can threaten the integrity of the whole, it is more important than ever to thoroughly identify every player involved, including the parties with whom each has relationships. Once you have the full picture, your team will be well-positioned to take on the task of identifying and prioritizing the risks that each presents so that vulnerabilities can be eliminated or reduced.


Scouring the supplier landscape for alternative vendors may have seemed needless at one time, particularly for organizations who have long-standing, positive relationships with their current partners. However, the 2020 pandemic has showcased the shortsightedness of this approach, demonstrating in stark terms that manufacturers who relied on single-source companies experienced significant and costly interruptions almost immediately.

While working with disparate vendors may be a practical goal for some organizations, however, the electronics sector has proven to be an exception since numerous components and raw materials only come from one or two sources in Asia. As governmental and commercial entities work to change this situation, businesses like yours can minimize the risk by establishing relationships with backups who may have inventory that you can purchase in an emergency.


As mentioned above, technology manufacturers are not as able to diversify in the current climate as other companies may be. An alternative is to change the way inventory is ordered. Whereas it may have made sense to only order what you needed to reduce warehousing costs when times were stable, a difficult economy or a crisis means that it might be better to invest in additional space and stockpile critical components. By doing so, you may be able to go on with your operations long after competitors who continue to favor the just-in-time model of ordering have closed down.


Just as emergency preparedness needs to be accomplished in advance, so does gathering a team of knowledgeable people who are ready and well-equipped to help during difficult times. Do your research now to find a logistics and supply expert that you can retain to be available when the need arises. This person or group will know how to help you locate other suppliers, understand laws and surcharges and manage customer expectations.

Planning and forethought are vital components for any large-scale electronics manufacturer. The companies who possess these qualities will be nimbler than their competitors and will therefore be able to ride out rocky patches in the economy or natural or human-made disasters. There are many obstacles that businesses cannot control, but implementing preemptive strategies and supply chain procedures can minimize their negative effects.