Electrical goods stocks low for Christmas

1 December 2010
Parts shortage hampers electronics supply chain
Electronics firms fined for cartel activity
Recession gave LG Electronics buyers chance to shine, says CPO
Sony cutbacks help boost profits

Dell moves to sue five Asian suppliers

1 December 2010 | Angeline Albert   

Retailers’ failure to invest in their inventories this year could see a shortage of top electrical goods such as games consoles and flat screen TVs this Christmas.

This is the warning from procurement consultancy BravoSolution, which said shortages are looming. Ongoing economic uncertainty led companies to hold on to cash reserves, and suppliers reduced inventory levels rather than have redundant stock and risk significant losses if products were left unsold.

Despite there being less than a month to go until Christmas day, lead times for electrical components have increased dramatically, hitting dangerously high levels of more than 50 days instead of the 10-12 day average. 

“Lead times were becoming a problem as early as March 2010,” said Paul Martyn, vice-president of global marketing at BravoSolution, because fears of a double-dip recession were setting in.

The company said the supply of electrical components, such as computer chips and touch screens, has been affected by inventory decline.

Martyn added: “Buyers should nail down lead times and build flexibility into contracts with suppliers to suit changes in economic conditions. If inventories remain at low levels, supply may not be able to catch up with demand until the first quarter of next year. This means quarterly results could be affected, which will impact on the profitability of manufacturers and retailers.”

A focus on toy supply chains will appear in the 9 December issue of SM

 

LATEST
JOBS
Swindon, Wiltshire
upto £40K base (+ Paid overtime and corporate benefits)
Honda Manufacturing Ltd
Kew gardens, Richmond upon Thames, London (Greater)
£37,000 - £42,500 per annum pro rata, depending on skills and experience
Kew Royal Botanic Gardens
SEARCH JOBS
CIPS Knowledge
Find out more with CIPS Knowledge:
  • best practice insights
  • guidance
  • tools and templates
GO TO CIPS KNOWLEDGE