December 7, 2011
Why Working with an IDEA Member is a Great Idea
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Dwight Gerardi
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Labels: 76-point inspection, Advanced component testing, Counterfeit detection, Electronic components distribution, IDEA, Quality assurance process, Shortages
November 23, 2011
Download Free Shortage Market White Paper
Sooner or later, every technology-driven company will face an electronic components shortage. After all, the only predictable thing about the electronics supply chain is that it’s unpredictable. So how can manufacturers keep production lines moving when needed parts are not flowing through the typical distribution channels? That is one of the topics explored in the Converge white paper “Finding Components in a Shortage Market.”
- What are the risks associated with shortages?
- What capabilities should you look for in a shortage inventory partner?
- Is there a way to plan ahead for shortage electronic situations?
Supply chain disruptions in the electronic components industry may be a reality, but that doesn’t mean they have to derail your business. Partnering with a trusted independent distributor can give your company a significant edge when it comes to procuring shortage electronic parts and protecting your supply chain from unwelcome interruptions.
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Converge
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9:30 AM
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Labels: Allocated parts, Electronic component shortages, Electronic components distribution, Hard-to-find components, Shortages
November 9, 2011
Seeing Is Believing in the Electronic Components Industry
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Converge
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10:00 AM
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Labels: 76-point inspection, Advanced component testing, Counterfeit detection, Electronic components distribution, Quality assurance process
October 12, 2011
Three Ways to Recover Value from Surplus Inventory III
Converge offers three valuable ways for manufacturers to recover value from surplus inventory of excess electronic components. In this blog series, we have already learned about the outright buy and consignment options. Now we will take a closer look at the third option, which is taking advantage of our leverage program, also known as “demand” opportunity.
However, there are a few drawbacks to the demand opportunity option that companies should be aware of. Since Converge does not actually have electronics component inventory in our possession, we rely on the accurate descriptions that the sellers provide. Products received by Converge must be in the exact condition expected; otherwise, the status of a pending sale could be compromised. The seller may also be required to provide additional company resources to facilitate the flow of information and approvals during the negotiation phase.
In addition, valuable time (and potentially, money) can be lost in a leveraged transaction, because it takes longer for the product to get from the seller to the buyer. The consignment and electronic parts procurement program does not face these challenges, since Converge has the chance to inspect, sanitize, and prepare inventory for shipping before it is ever remarketed. When consignment products are sold, they can be shipped out the same day, which maximizes value for the seller.
If you missed Part One: The Outright Buy or Part Two: Consignment of this series, you can read them now.
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Converge
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1:44 PM
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Labels: Demand opportunity, Electronic components distribution, Excess inventory management, Global footprint, Leverage program, Market intelligence, Surplus remarketing
September 28, 2011
Three Ways to Recover Value from Surplus Inventory II
Part Two of Series: Consignment
In our last post, we discussed the benefits of using an outright buy option to recover value from your surplus inventory, which includes finding someone to buy obsolete parts. Now let’s take a look at the consignment option. To simplify, we will start with a comparison.
In the last decade, consignment shops have become a popular way for families to resell expensive and unused child-rearing gear that they no longer need. The family leaves the unneeded items in the consignment shop. If the store is able to sell the items, the family receives a percentage of the sale. Buyers are delighted to find valuable items for less than retail cost, and the family is pleased to recover value from the unneeded items with almost no effort.
Consignment of surplus electronic components works very much the same way. If you find yourself with excess electronic parts, but you don’t think that you can maximize its value through an outright sale, you can consign the products to Converge. We receive, reconcile, inspect, and stage the products, while your company retains ownership, complete visibility, and control of each line item – down to the resale price if you choose. Then our commodity experts put their market intelligence to work for you, scanning the globe for buyers who may need the parts you have in surplus. When we find a buyer, we take care of the details. Then your company gets the majority of the proceeds, which enables you to recover a significant amount of value from items that otherwise may have been scrapped.
The consignment option is very similar to Converge’s third option for recovering value from surplus: taking advantage of our leverage program, also known as “demand” opportunity. What is the major difference between the two, and which option would work best for your company? We hope to answer those questions in Part Three of this Series: Consignment.
If you missed Part One: The Outright Buy you can read it now.
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Converge
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9:16 AM
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Labels: Consignment, Electronic components distribution, Excess inventory management, Market intelligence, Surplus remarketing
September 14, 2011
Three Ways to Recover Value from Surplus Inventory I
You can try to return surplus inventory and obsolete electronics to the manufacturer or franchise distributor, and you will likely end up paying a restocking fee if you are able to return it at all. If that doesn’t work, you can check to see if the materials can be used by another internal project. If those two options don’t pan out, some companies will resign themselves to taking a loss on the inventory and go into scrap mode.
OR…you could partner with an independent distributor like Converge to consider other possibilities. Converge offers three different ways for companies to recover value from surplus inventory: outright buy, consignment, and our leverage model, also known as “demand” opportunity. In this blog series, we will explain and differentiate these options, starting with the outright buy.
In an outright buy, a manufacturer sends Converge its surplus inventory list. Converge’s commodity managers review the list, determine what the products are worth on the current market, and then may make an offer to buy the inventory outright. This is the perfect option for a company that wants to unload the surplus immediately. Keep in mind that if you are an OEM that owns surplus sitting in a contract manufacturer’s warehouse, you are probably paying storage costs for that inventory.
In addition, there is the potential for depreciating technology due to price erosion and product freshness factors. So the longer the inventory sits, the more money you stand to lose. With the outright buy option, Converge takes the excess electronics component inventory out of your hands and off your books, and you are free to focus on other matters.
One drawback of the outright buy is that your product mix may be moderately liquid, which could negatively affect your buyout amount. If your independent distribution partner is unsure about the return on investment due to market conditions, product condition, date code, or other risk factors, the buyout offer will be lower than if the risk were being shared by both parties. If this is the case, risk-sharing options such as consignment or demand opportunity might be a better choice for recovering value from your surplus. We will explore the topics of consignment in part two and demand opportunity in part three of this series.
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Converge
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2:42 PM
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Labels: Commodity management, Electronic components distribution, Excess inventory management, Market intelligence, Outright buy, Shortages, Surplus remarketing
August 31, 2011
What to Look for in a Surplus Remarketing Partner
When looking for an independent distributor to help you remarket surplus inventory on the open market, there are several key qualities that you should check for:
Size. Independent distributors come in many shapes and sizes. The bigger the company, the more “tribal knowledge” you will have working to your advantage. Size does matter when it comes to recovering the most value for your inventory.
Commodity managers. Generally speaking, commodity managers go hand in hand with size. A small, independent distributor will probably not have experts who are solely dedicated to studying one particular commodity’s global activities; larger ones probably will. Commodity managers devote their time to assembling complete market intelligence around one or two specific commodities and can provide a wealth of in-depth market knowledge to the traders working on your behalf.
Around-the-clock workforce. We operate in a global economy, not one that ends at 5 p.m. in the time zone that we happen to live in. When it is 5 p.m. here, the workday is just beginning somewhere else in the world. A global independent distributor will have commodity managers working around the clock in different regions of the world, which enables that distributor to find a solution for your surplus parts in as little time as possible. In addition, because an independent distributor with an around-the-clock workforce never stops working, it never misses a beat when it comes to knowing about world events that may affect the market.
The need to remarket surplus inventory will always exist, whether there is a surplus market or a stable market. Despite their own best-laid plans, manufacturers will end up with more parts than they need for the current demand of their products. It is simply the cost of doing business in an unpredictable world. The good news is that solutions do exist to help mitigate surplus inventory costs, no matter which market currently prevails. By partnering with an independent electronics distributor you trust, your company will be better prepared to handle any surplus market challenges that come along.
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Converge
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2:07 PM
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Labels: Commodity management, Electronic components distribution, Excess inventory management, Global footprint, Market intelligence, Surplus remarketing
August 16, 2011
Mitigating Risk in a Surplus Market
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Converge
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9:04 AM
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Labels: Electronic components distribution, Excess inventory management, Obsolete parts, Surplus remarketing
July 13, 2011
Vendor Screening and Management Is a Must
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Eric Checkoway
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9:00 AM
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Labels: 76-point inspection, Advanced component testing, Commodity management, Counterfeit detection, Electronic components distribution, Quality assurance process, Vendor screening
June 29, 2011
Why a Global Footprint?
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Eric Checkoway
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8:00 AM
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Labels: Allocated parts, Commodity management, Electronic components distribution, Global footprint, Hard-to-find components, Market intelligence, Shortages, Surplus remarketing
June 15, 2011
Expert Engineers: Another Piece in the Quality Puzzle
At Converge, we are committed to ensuring the quality of every single electronic component lot that passes through our facility.
That is why Converge only hires certified engineers with a bachelor’s degree and three years of field experience, or an associate’s degree with five years of field experience. Upon joining Converge, they undergo an extensive training process that includes learning the detailed steps in the Converge electronic component inspection process from one of our tenured component engineers.
Among other credential and training requirements, Converge engineers are required to:
-Be certified to ANSI ESD 20.20 – 2007 standards
-Attend ongoing Counterfeit Electronic Component Avoidance Workshops (CCAW), which highlight the latest counterfeiting trends in the marketplace
-Attend ongoing Measurement System Analysis training
Posted by
Dwight Gerardi
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9:05 AM
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Labels: 76-point inspection, Counterfeit detection, Electronic components distribution, IDEA, Quality assurance process, Vendor screening
May 11, 2011
The Value of Commodity Management
Converge has the broadest, deepest, and most dependable network of technology manufacturers and suppliers in the world. Those relationships do not come easily; they are the result of providing quality service for more than thirty years in the industry.
Posted by
Eric Checkoway
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11:34 AM
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Labels: Commodity management, Electronic components distribution, Global footprint, Hard-to-find components, Market intelligence, Shortages
April 27, 2011
When It Comes to Excess Inventory, Help Me Help You
Even though it has been 15 years since “Jerry Maguire” was released in the theaters, I still hear lines being quoted from the movie all the time. You know the ones I’m talking about: “You had me at hello,” “Show me the money,” and of course, “Did you know that the human head weighs eight pounds?”
One memorable line from that movie has always jumped out at me, because it so succinctly says what I frequently wish I could tell my customers in my role as a trader of electronic components. It’s when sports agent Jerry Maguire begs his star client, Rod Tidwell, “Help me help you.”
As a trader at Converge, who deals primarily with excess electronics components inventory, my job is to help companies find buyers for inventory they no longer need. The longer these parts sit idly, the more investment companies stand to lose on them. When a company comes to me with an excess problem and I begin to evaluate their inventory resale possibilities, I can’t tell you how often I think, “Wow. If I had only known about this three months ago, when this part was in shortage, I could have found them a great price.” I can almost guarantee that the company has been sitting on the excess for longer than three months. They just took a long time to get around to telling me about it.
So here’s my insider tip. If you want to make the most out of your relationship with an independent electronics distributor, the key word is “relationship.” Build one. If you think back to “Jerry Maguire,” Jerry and Rod Tidwell end up forming a relationship through having constant contact. And ultimately, it is that relationship and an understanding of one another’s needs that enables them to help each other.
Getting to know your inventory as early in the game as possible will allow us to help you get the most return on your excess products. Talk to us regularly. Tell us about your excess inventory as soon as you know you have it. Not when you must get rid of it…but when you could get rid of it, if the price is right. Then we can put our market intelligence to work for you on an ongoing basis, instead of just when there’s urgency. And we can help you make educated decisions about when market conditions will be most favorable for you to sell.
Whether you’re looking for an outright buy solution, a consignment program a demand opportunity, or something in between, I can find the resale solution that is most beneficial for your bottom line.
I’m always happy to help you find a solution for your excess inventory. It’s what I do. But if you tell me sooner rather than later, I might be able to get you top dollar for those parts, instead of pennies on the dollar. Help me help you.
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Converge
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11:25 AM
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Labels: Consignment, Electronic components distribution, Excess inventory management, Market intelligence, Outright buy, Surplus remarketing
April 13, 2011
X-ray Vision: Leading the Way in Electronic Component Supply Chain Quality Initiatives
To ensure that every part we sell is 100 percent authentic, Converge has invested in the most advanced technologies available for electronic component inspection and testing services. Not only do our highly trained, in-house component engineers microscopically inspect a sampling of every part number purchased by date/lot code, we also use X-ray and decapsulation machines to view inside components to eliminate potential non-conformance. Much like an X-ray exam you might have at the hospital, our X-ray machine allows us to verify that everything that should be inside a component is there and intact.
If we need an even closer look, we can remove the top of a component with our “decap” machine. This gives us a magnified view of the interior of the circuit and enables us to confirm that the die matches the component, when needed. Not having to outsource these inspection services also helps us provide customers with faster delivery TATs.
I believe that our willingness to continually invest in technology and detection methods demonstrates Converge’s commitment to preventing counterfeit parts from making it into our supply chain. And after 30 years as an independent component distributor, we have the quality record to back that claim.
Posted by
Dwight Gerardi
at
11:57 AM
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Labels: Advanced component testing, Counterfeit detection, Electronic components distribution, Quality assurance process
March 30, 2011
Broker vs. Independent Distributor: What’s the Difference?
In the beginning, most brokers of electronic parts fit the classic definition of the word and didn’t offer much beyond that: They arranged transactions between buyers and sellers and earned commissions from the sales. A broker could be a large firm or a guy in a basement with only a handful of inexpensive parts stocked as inventory. A broker simply knew how to get the parts that you needed, and that’s what made his services valuable.
The founders identified the need to differentiate the new services that Converge provided from those of the “average” parts broker. The “independent distributor” distinction caught on immediately and is now widely used throughout the industry.
- Global footprint. Independent distributors have infrastructure (in addition to sales offices) sprinkled around the globe. This enables them to provide full end-to-end service — from warehousing to packing to shipping — for customers almost anywhere in the world.
- Robust quality programs. This is an important differentiator. Counterfeiters grow more sophisticated every day. The average broker does not have the capability to inspect and test the parts that it sells. Conversely, an independent distributor invests in capital test equipment, staff education, and internal engineers, who conduct rigorous electronic component inspections to ensure the authenticity of every component.
- High industry standards. I’m not trying to say that the “average” broker doesn’t have standards. However, independent distributors (at least the ones that want to be taken seriously) are required to have them. Most aim to join industry trade organizations, such as the Independent Distributors of Electronics Association (IDEA), which has stringent membership requirements. These IDEA standards set the bar high on everything from the certifications that independent distributors must obtain to the amount of product liability insurance they must carry. When you work with an IDEA member, you are assured that you are working with an electronic components distributor that has dotted every “i” and crossed every “t.”
- Market Intelligence. Due to its global footprint and vast network of industry connections, an independent distributor can provide valuable insight into what is transpiring in the market. Instead of simply finding or selling the parts that a client needs, an independent distributor can help the client make educated, long-term decisions based on market dynamics prior to each transaction.
- Reliability. Since independent distributors offer more resources than do brokers, they are able to offer higher levels of service, quality, and liability protection to their customers. If there is a problem with a shipment that you purchase, you can trust that an independent distributor will be there to remedy the issue. Small brokers cannot make that same guarantee.
For more information on the differences between an independent distributor and a broker, please visit our website.
Posted by
Converge
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2:39 PM
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Labels: 76-point inspection, Broker, Counterfeit detection, Electronic components distribution, Global footprint, IDEA, Market intelligence, Quality assurance process
March 16, 2011
Japan's Earthquake Impacts Supply Chain
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Converge
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5:01 PM
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February 22, 2011
Converge: A Recipe for Success in the Global Electronics Industry
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Converge
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10:32 AM
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Labels: Broker, Counterfeit detection, Electronic components distribution, Hard-to-find components, Market intelligence, Quality assurance process, Shortages
January 31, 2011
Converge China offices closed for Chinese New Year.
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Converge
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11:35 AM
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