Global Market Trends #4: Component Sense's Advice to Customers

As we approach the halfway point of 2022, this year is proving to be full of unpredictability, market turbulence, and industry uncertainty. From extended Covid-19 lockdowns in China to the conflict in Ukraine, the global market has faced a range of issues. Over the course of our Global Market Trends editorial series, Component Sense has examined the root causes of these supply chain difficulties, outlined the international industry response, and in our penultimate blog post, we discussed predictions for the future of the electronics industry. In this fourth and final instalment, Component Sense is getting more personal and offering our exclusive, expert-driven advice to customers and industry partners. All authorities agree that the market must inevitably crash: after all, the current high inflation rates, seemingly endless demand, and ever-increasing prices cannot last forever. So, how can Component Sense help you to navigate the choppy waters of the inevitable market downturn?

We at Component Sense are certain that a focus on awareness and interaction is key to any company’s resilience. Our CEO, Kenny McGee, stands firm in his opinion that both suppliers and manufacturers need to “start reassessing and reducing their inventories right now, regardless of whether or not they can make a profit.” Kenny also urges customers to focus on interdepartmental communication, stating that “speed is of the essence in reacting positively, and accounting departments cannot quickly jump to action if they are not up-to-date with all relevant information.” Kenny warns that change will happen very suddenly, as it did in 2001. This abrupt market turnaround saw companies being hit with huge bills to cover forecasts, and Kenny predicts this will happen again. This is a major danger of overbuying and over-forecasting, but by carefully reassessing and reducing inventory, companies can navigate the shifting demands of a volatile supply chain and international market. Component Sense is excellently positioned to stay ahead of the curve, as our business model means that we see changes in the market before the media or news outlets. Therefore, we can identify risks and help in your approach to risk management!

We are a company dedicated to integrity and maintaining customer satisfaction. Grant Rutherford, our CTO, emphasises this, saying that “we’re not trying to take advantage and make a quick buck from customer difficulties” in these turbulent times. As a company that has witnessed market crashes and recessions since its creation in 2001, we know how important it is to have empathy for our customers and industry partners. Unlike most companies, we have no desire to keep our market insights to ourselves to maximise profits. Grant repeats that Component Sense’s priority is “always the relationship with the customer rather than profit.” It is with this sentiment in mind that we decided to write these Market Trends editorial pieces and share our insights with you.

Component Sense’s Sales Director, Rose Hartzell-McGee, sees market fluctuations first-hand. Rose outlines that she is always monitoring quote/sale rates and knows what signs to look out for when it comes to the global supply chain. Rose outlines the difficulty in predicting the future of the market, as only certain products are strongly affected by low supply and high demand. However, Rose also tells us that “even parts which are not in demand are being raised in price because manufacturers can … they have the upper hand over the buyer.” This is another reason why it is so important to maintain close industry relationships: through communication and collaboration, we can work together to minimise the risks associated with inflated prices and a volatile market. Component Sense’s vested interest in protecting our assets means that you can be sure we will work our hardest to protect yours as well.

In summary, here are Component Sense’s main pieces of advice for customers:

  • Reassess and reduce inventory.
  • Identify risks.
  • Educate all departments.
  • Communicate, communicate, communicate!

We hope you have found our Global Market Trends series insightful and helpful. If you missed them, here are Parts One, Two, and Three. We are living through history in the making, and if we continuously emphasise knowledge and analysis, we can continue to stay on top of market fluctuations and supply chain difficulties. We look forward to working with you.

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