Issue link: https://iconnect007.uberflip.com/i/1069358
JANUARY 2019 I PCB007 MAGAZINE 17 in parts once you have them pipelined than trying to start from scratch and pull in parts to wait for lead times. Somebody needs to put those on order. The reality is that unless there are non-cancelable, non-returnable parts, you can cancel or reschedule within 45 days typically without any problems. If they're some of the really hot parts, you have no liability. There are a lot of strategies that you can go with if you have a design coming, but you have to think ahead on planning the supply chain. Shaughnessy: It sounds like they just need to stay on the ball. Martin: There's no silver bullet. Las Marias: When it comes to supply chain, one of the issues is counterfeit components. Now that the industry is facing this severe shortage, do you expect an increasing number of counterfeit components in the market? Martin: Absolutely. That's one of the things that we talk to the customers about. The grey market is actually drying up. A number of manufacturers have shut the back door for the grey market suppliers—the independents. Further, some distributors have shut the front door, so they can't order from their sites. The amount of inventory that's still available through the grey market is getting tighter and tighter, which means your risk of counterfeit goes up. We have a small set of approved indepen- dents that we've audited. Each of them has You're going to pay the tariff on the dollar— not the 75 cents—so it's a real challenge right now. We are capturing the harmonized tariff and HTS codes on all of the parts. We ask for the country of origin when we place an order. And if we have an option to use a country of origin other than China, that's where we're going, even if the price is a little higher. We are hearing that the manufacturers who already have sites outside of China are looking at rescheduling their business for goods based in North America to sites outside of China. We haven't seen a lot yet, but we're hearing it's happening. For our U.S. facility, we'll be very carefully looking at who the manufacturers are and where it's coming from. If we have options to avoid this 25% tariff, that's where we're going. Andy Shaughnessy: My readers are primarily designers. Let's say you have a product coming out next Christmas in 2019. Other than stockpiling, how do you plan for the future? What should they do to try to get ahead of this? Martin: When I meet with engineers, I tell them if it's a brand-new product, design it in the smallest case size possible; 0201s and 0105s are your best bet. In those cases, if you can approve automotive grade, you have a better shot of getting parts. They tend to be a little higher priced, but you can still get parts in the automotive grade. If you can't design it, you need to offer as many alternatives as possible. The worst thing you can do is come out with one sole-source part because you will ultimately have supply chain problems at some point, whether it's today or later. What we ask our customers to do before they stabilize and while they're in the process of design is to let us analyze their BOM. We use IHS Connect software as a predictive modeler. What we like to do is work with them while they're still in the beta stage. If you have a partner that you're going to work with to outsource your product, you need to give them the authority to place parts on order as soon as you qualify them, so that you can at least get in the pipeline. It's more successful to pull The amount of inventory that's still available through the grey market is getting tighter and tighter, which means your risk of counterfeit goes up.