May 11, 2011

The Value of Commodity Management

One of the things that sets Converge apart from other independent distributors is the fact that we employ a full team of commodity managers providing around-the-clock global coverage for our customers. Not just one or two…but thirteen! Most independent electronics distributors do not have even one.

In the electronic component market, a commodity is defined as a type of component whose price is subject to supply and demand. Each commodity is considered interchangeable; the market treats it as equivalent no matter who produces it. The commodities that Converge tracks, buys, and sells in the independent electronic components market typically include, but are not limited to, CPUs and chipsets, memory, LCDs, integrated circuits (ICs), and passives.

A commodity manager is responsible for closely tracking the performance of a specific set of commodities in the marketplace, similar to the role of a broker in the stock market. This ensures that, in the ever-changing world of electronic components, a commodity manager can help determine the best time to buy and sell that particular commodity. Our commodity managers monitor market prices, analyze market trends, and provide Converge traders with real-time access to the information they need to make informed decisions.

How does this help our customers? Well, our traders buy and sell to serve our customers’ needs. If you have excess memory that needs to be unloaded, our memory commodity managers will put their market intelligence to work for you to obtain the best value for that product. Not only do they know what that commodity is selling for, and whether it may be affected by an excess or shortage situation, but they also know what companies are using that particular product and might want to buy it.

Conversely, in a shortage market, when you cannot obtain the parts you need from a contracted electronics distributor, our commodity managers can not only source the electronic components but also have the negotiating power to get the best price.

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.
So what is the value of working with an independent distributor that has commodity managers? Competitive advantage. Our market intelligence will help you make better, more reliable, and profitable trading decisions as well as help minimize your risk in the supply chain more effectively around the globe.

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