4 Different Options to Consider When Buying Electronic Components
There are four different types of suppliers to choose from when buying electronic components. These include:
- Independent Brokers
- Catalog Suppliers
- Authorized Dealers or Distributors
Each of these electronic component suppliers has its own upsides and downsides. No matter if you have in-house manufacturing or you have outsourced processes to a CEM (Contract Electronics Manufacturer), your supply chain needs to be reliable.
In most cases, companies have to use several types of suppliers throughout the product lifecycle. Luckily, today it’s easy to find the right components and compare them with services like Octopart.com. But when you find those components, you need to see who supplies them and choose the best option.
This post can help you understand the differences between providers and figure out the best one for your needs.
1. Independent Brokers
These independent suppliers usually have no ties to any franchise. Instead, they are experts at sourcing parts and finding rare components. However, buying parts from suppliers that aren’t tied to producing franchises means that there is a dose of risk involved.
When you can’t find a component you need because it’s very rare or it has been discounted, your best chance of finding it is through independent brokers. Additionally, they usually have a much shorter delivery time than authorized manufacturers or distributors.
But their service has a fair share of downsides as well. They don’t have the same level of after-sales or technical support. In most cases, there isn’t support whatsoever. Since brokers usually have parts that are hard to come to by, they often boost their prices.
Tracking parts can also be difficult because they often sell products that are counterfeits or come from sub-standard manufacturers.
2. Catalog Suppliers
A lot of buyers prefer catalog suppliers. These suppliers first started by engineering or purchasing products based on catalogs. They purchased original catalogs, licenses, and specifications to produce new components that they would use for their needs.
However, after some time, they switched their approach to selling electronic components. The internet has changed everything, and most catalogs are new public and available to everyone. These suppliers have expanded their range of products, and a lot of manufacturers rely on their services.
Catalog suppliers have a large stock of products that are also available in small batches, so you can purchase a small amount to prevent your production line from topping. In most cases, there is no minimum order quantity, which makes them an economical source.
Their strength is also their weakness. These suppliers have the same price per unit, no matter the quantity. If you are looking for premium prices, you will need to set up a long-term account, which can be limiting.
3. Authorized Dealers or Distributors
For larger companies that have a stable production line, authorized dealers are the preferred choice. They are official middlemen between electronic manufacturers and buyers. Authorized Dealers have exclusive deals with manufacturers concerning the market, targets, stock levels, and pricing.
In most cases, dealers don’t offer any additional benefits than buying directly from a manufacturer. Manufacturers have all the power, and they set the rules of their operations. The name says it all; they are there to distribute the products and follow the standards of the manufacturer.
However, distributors often work with several manufacturers, allowing buyers to find everything in a single place. They also reduce costs because manufacturers can often be really far away. The biggest drawback of authorized dealers is that they can change their business strategy and cancel agreements with manufacturers.
4. Buying From Manufacturers
Manufacturers produce, brand, and design their components. They are the ones that bring innovative solutions into the market and discount products once there is no demand. When purchasing products from them, you can get the most accurate information, traceability, and support.
This is the shortest route to buying components that have a high quality. There are no risks that go with supply chain delivery. All of the parts are genuine and handled with care, so you know with 100% what you’re getting. All the products are traceable and come with technical specifications.
You can rely on the latest technologies to drive business results. However, manufacturers only deal with buyers that have large needs and will purchase high volumes of parts. At the same time, they will often offer only the newest parts, which can be more expensive even though they don’t offer any major benefits.
All of these suppliers have their pitfalls and benefits. It’s up to you to assess your business needs, resources, and logistics to make the best decision possible. In the end, when looking at a supplier, make sure to check their reputation and what other customers say about them.