Friday, November 21, 2003
14
Custom
vs Commodity Components
•EMS
procurement experts tell us that they prefer to order commodity
components vs custom components
–Reason
– EMS’s don’t want to be stuck with un-used inventory of custom
components that they can’t use for a other projects
•EMS’s get 6 month rolling customer production forecast,
with <1 month order commitments
•This
un-used “custom inventory” could put a big bite into the razor thin
margins of EMS’s