For component distributors in South Africa, it has been somewhat of a rollercoaster ride over the past two to three years. Most South African companies have come to terms with the strong rand and have fine-tuned their efficiencies to compete with the rest of the world. In general the South African economy is doing well and we need to continually improve our value add proposition to be part of this positive trend.
We are seeing lead-times pushing out and prices hardening. This is normally an indication of an increase in electronic manufacturing globally. For Avnet this has certainly been the case with increased turnover in all global regions.
For Avnet it has also been a very exciting period, having completed its largest global acquisition, namely Memec. This has been a successful acquisition followed by a quick integration of the Memec business into the various Avnet business units globally. This acquisition effectively makes Avnet the biggest component distribution company in the world. For Avnet Kopp, the success of the Memec integration has meant adding a number of key lines to its line card namely Linear Technology, Pulse, Kemet, Nordic, SMSC and Cirrus Logic.
For distributors, it is no longer good enough to have the major suppliers on your line card. Differentiated service and improved service levels is what customers are looking for. Distributors need to add value to the supply chain. Avnet Kopp has focused on a number of areas to assist customers.
It provides technical support to its customers in the form of trained field application engineers. These engineers are armed with knowledge of the latest technologies and products available. With its broad line card Avnet Kopp can offer a complete solution from board level components to enclosures and complete modules such as GPS, GSM and printers. It has the full technical backing from its suppliers - some of these product specialists are real experts in their field.
Apart from its local stock holding, Avnet Kopp has access to world class logistics through Avnet in Europe and in the USA. It is able to tap into over $1 bn worth of inventory from warehouses in these two regions. In this way it enjoys a price advantage that helps its customers to be more competitive and it also shortens lead-times.
POURS (Point Of Use Replenishment Software) is a tool that Avnet Kopp offers to customers to help them better manage their inventory. This system offers customers a consistent flow of components without the need to build up unnecessary inventory. In this way lead-time 'ups and downs' are smoothed out and managed more effectively.
In my opinion, we have world-class contract manufacturers in South Africa, and we, as distributors, need to advertise the capabilities of these companies to all customers to keep manufacturing from moving offshore.
We have seen a strong upturn in business since the beginning of this year. Customers are more positive and South African customers are successfully competing for local as well as export business - even with the strong rand.
We are optimistic about the opportunities that lie ahead in our industry. With the Memec integration, Avnet Kopp has strengthened its salesforce and now has a bigger line card than ever to offer to customers. We, as well as our customers, just need to be aware of the upward growth trends and the lengthening lead times that accompany this.
For more information contact Hannes Taute, Avnet Kopp, +27 (0)11 809 6100, [email protected], www.avnet.co.za
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