03 January 2008
Consolidation between suppliers within the manufacturing sector, and the tendency for buyers to source ever smaller orders offshore is threatening the supply chain of electrical components, an industry body has warned.
Adam Fletcher, chairman of the Association of Franchised Distributors of Electronic Components (Afdec), said: "Customers are ordering 1,000 boards and having them assembled offshore because of the lower unit prices, without thinking about total acquisition price."
New Afdec figures have shown that the UK components market will shrink by almost 8 per cent this year. If this trend in manufacturing continues then the numbers of suppliers are likely to fall as consolidation takes place, he says, threatening the entire supply chain.
Fletcher also spoke of overdependence in the sector on the Eurofighter/Typhoon project. "Everybody's fighting for a share of this business," he said.