Supply constraints approaching

Prices are rising by 5-15%, and lead-times from manufacturers for standard products such as MCUs has already reached 23 weeks in certain circumstances. And this was already the status prior to the recent events in the Middle East, which are likely to compound and exacerbate the situation.

“We are hoping that it won’t return to the disruption experienced in 2020-2022 when customers without forward orders found themselves paying extreme premiums on the grey market simply to keep production running “, says John Bowman, Anglia’s marketing director. “But already, some memory manufacturers have closed their books for new orders this year, and across the board, our manufacturing partners are quoting progressively longer lead-times. You have to learn from history, and I am highly certain we are heading towards a period of restricted supply in the very near future.”

With more than 50 years of experience navigating market cycles, Anglia is advising customers to place orders early to secure their required production volumes. Bowman continues: “Customers need to take measured action now and lay down their component requirements for at least the next 12 months. Now is most certainly not the time to sit back and wait – as Theodore Roosevelt once said: ‘…the worst thing you can do is nothing’ “.

As manufacturer and distribution inventories tighten and die banks are drawn down, goods ordered today are likely to have a lead time of six months, and extending. But that is much better than being told that there is no availability and no chance of getting the parts you need other than falling back on the grey market. 

Bowman concludes: “We have a reputation as the eyes and ears for SMEs. We are trusted to work with them through challenging times and help mitigate risks to their production. But it’s vital that our message is taken seriously — recent years should not create a false sense of security. Purchasing strategies need to adapt, and the time for action is now.”

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