While there are dangers from untrained staff, substandard and counterfeit parts, and supply chain disruptions, arguably the most dangerous land mine is an untrustworthy supplier. An organization depends on its suppliers to deliver products on time, at the right price, and in compliance with its quality standards. Choosing the wrong supplier can lead to shipping delays, product returns and poor quality, all of which result in lost time and profit. An organization’s supplier selection impacts an organization as a whole.
In the movie Indiana Jones and the Last Crusade, Harrison Ford’s character is forced by a Nazi cooperator to find the Holy Grail to save his father from certain death. From a table replete with various different chalices, the evil Nazi incorrectly chooses the most ornate one and subsequently dies. The Crusader knight that has been guarding the Grail admonishes, “he chose poorly”. Indiana Jones picks the simple wooden chalice by intuitively guessing it would be the cup of a carpenter (Jesus) and saves the day. The Crusader knight confirms his choice with, “you have chosen wisely”. Unfortunately, selecting a supplier for your organization is not as cut and dry as in the movies. Recent examples reported by ERAI highlight extra steps that you should take prior to adding a company to your AVL.
How old is your ERP?
This is an important question, because a lot of people are using painfully obsolete systems. And I don’t just mean “Windows 2000” obsolete; I mean “Ronald Reagan was president the last time this system was updated” obsolete. Yes, it’s an often-painful irony that the companies that source and distribute electronic components are frequently using outdated technology to do business. And while you may feel like you’re trucking along just fine, the fact is that, if you’re using a system that was new when it was still “Morning in America,” then you’re crippling your ability to effectively source components, track shipping, and manage inventory. And that doesn’t just make you less competitive; it exposes you to the risk of unknowingly handling subpar or even counterfeit parts. That severely reduces your credibility as a parts distributor – and without credibility, what do you have?
What are the dangers lurking behind a well-designed website or a friendly email? Unfortunately we don't always know until a problem causing irreversible damage occurs. In an effort to limit your exposure to potential problems in this ever-changing and somewhat volatile global electronics supply chain, it is imperative that any and all steps possible are taken to verify the legitimacy of the organization you are considering doing business with.