EMSNOW Up Close: WinSource Electronics
WINSOURCE is increasing their visibility in the global marketplace. We recently contacted Nico LV, Vice President of Operations and Customer Success for more details about the strategy and services offered by this global distributor.
EMSNOW: Please describe your role in the company.
I am pleased to be interviewed by EMSNOW magazine. I would like to emphasize that our company is dedicated to innovation and pursuing excellence. We specialize in providing high-quality solutions to our global customers, meeting their ever-expanding needs. Our foremost objective revolves around ensuring an exceptional customer experience. We are wholeheartedly dedicated to elevating customer satisfaction.
EMSNOW: WIN SOURCE was recently ranked on the“2023 Top 50 Electronics Distributors List” by Supply Chain Connect. Tell us about WIN SOURCE and the scope of your operations and customer base.
First and foremost, we are deeply honored to be featured in Supply Chain Connect 2023 as one of the Top 50 Electronic Distributors. This recognition not only acknowledges the unwavering dedication of our team but also stands as a testament to our continuous growth and development in the field of electronic distribution. Our team has always been driven by the mission to provide exceptional service and deliver high-quality electronic components to our customers while expanding our operations to meet their ever-evolving needs. Our partners and customers have been the cornerstone of our journey, playing a pivotal role in our success.
Established in 1999, WIN SOURCE has been dedicated to optimizing the procurement chain in the electronics industry, drawing upon over 23 years of supply chain expertise. With an extensive inventory featuring over 3000 manufacturing brands and over 1 million SKUs, we offer a comprehensive online service enabling global B2B customers to source electronic components through our expansive supply chain. Furthermore, we are committed to providing 24-hour delivery and a 3-year warranty guarantee. Leveraging our intelligent supply chain system, WIN SOURCE is steadfast in meeting customer demands, facilitating one-stop BOM procurement, swiftly accessing obsolete inventory, and consistently reducing procurement and production costs.
Our business scope encompasses several key areas, all aimed at providing comprehensive electronic component solutions to our customers. Firstly, we offer convenient online purchasing services for electronic components, allowing customers to order the components they need easily. Secondly, we specialize in sourcing obsolete and scarce components, helping customers find those challenging components to ensure uninterrupted production processes. Additionally, we provide surplus inventory purchase services, assisting businesses in managing stockpile issues and optimizing their assets. Lastly, we offer alternative solutions tailored to meet specific customer requirements.
Our EMS (Electronic Manufacturing Services) customers, whether large, medium, or small factories, sincerely appreciate WIN SOURCE for our significant contribution to optimizing their supply chains. Rather than solely addressing their local procurement challenges and high purchasing costs, we take pride in being recognized as their preferred choice for overseas procurement. We’ve observed that manufacturers, especially small and medium-sized enterprises (SMEs), face the challenge of high production costs, which can weaken their competitiveness and innovation capabilities. Unlike large corporations that can make bulk purchases, SMEs often engage in the demanding price comparison task to stay competitive. When they spend more time and resources on procurement, they have less available for technological advancements and product upgrades. This is where the WIN SOURCE platform excels, simplifying procurement and enhancing efficiency.
EMSNOW:What are the major challenges you see in the global electronics material supply chain?
T he unstable external environment and shifting international competitive landscape are the norms our industry must confront. While the COVID-19 pandemic is nearing its end this year, it continues to have a significant impact on supply chain security and stability. This, combined with trade tensions, supply bottlenecks, and mutual sanctions among nations, has exacerbated concerns regarding supply chain stability, even escalating into a full-fledged supply chain crisis at the peak of the pandemic.
These factors have placed the electronic component supply chain amid multiple challenges. Firstly, the instability in the supply of raw materials has raised alarm bells, as geopolitical conflicts and natural disasters can result in supply chain disruptions, impacting production and leading to price fluctuations. Secondly, the intricate nature of the supply chain has heightened the complexities of coordination and monitoring, rendering it susceptible to disruptions stemming from international trade policies and geopolitical factors. Furthermore, the rapid pace of technological advancements necessitates continuous adaptation to new materials and manufacturing processes, requiring substantial investments in research and development. Confronted with these challenges, as supply chain managers, we must remain agile and implement comprehensive measures to ensure the reliability and sustainability of the supply chain.
The rapid developments and changes in the international environment are driving supply chain transformation. This transformation brings not only challenges but also opportunities. In the short term, the growing emphasis on localized manufacturing and technological self-sufficiency serves as a significant driving force for industry professionals to expand their procurement channels and global reach. The electronic distribution industry can capitalize on these opportunities by embracing change and delivering distinctive services. In this regard, WIN SOURCE will continually optimize its supply chain system, expand global sourcing channels, and rigorously uphold quality standards during times of transformation. Regardless of how the electronic manufacturing industry realigns its focus, our company will remain closely aligned with actual demands and make corresponding strategic adjustments.
EMSNOW: Is the issue of shortages for active components improving?
In recent years, the rapid development of emerging technologies such as personal electronic devices, artificial intelligence, electric vehicles, the Internet of Things, cryptocurrency mining, and quantum computing has significantly increased demand for active components. Suppliers are increasingly concentrating on newer components with higher demand, necessitating time for expanding their production capacities. The production of active components requires substantial capital investment, and insufficient or inadequate investment to keep pace with demand growth can lead to shortages. This, in turn, creates a high-risk environment for mature, lower-profit product lines, as suppliers persist in manufacturing components for traditional products based on profitability.
Currently, economic downturns, geopolitical impediments, and supply-demand imbalances (bidirectional) are exacerbating overall uncertainty throughout the supply chain. While specific types of components have shown some signs of recovery, it is challenging to accurately predict when a widespread supply rebalancing will occur to meet demand. Mitigating active component shortages and achieving supply chain rebalancing will require some time.
As a globally committed company, WIN SOURCE remains vigilant in monitoring changes in supply and demand dynamics within the industry, conducting in-depth assessments of global market demands, and offering alternative solutions for both active and passive components as long as these products align with market needs and meet customer expectations.
EMSNOW: How much of your business is for the semiconductor supply chain? What are the current trends and challenges you see in this area?
When we assess our overall business structure, it’s evident that the semiconductor supply chain plays a significant role, accounting for 64% of our total business. Specifically, it constitutes an integral part of our company’s operations, highlighting the critical position of the semiconductor supply chain within our overall strategy and revenue structure. This proportion underscores our long-term commitment to the semiconductor industry and our exceptional performance in meeting customer demands, which is a pivotal factor in our business’s success.
In today’s era of globalization, the semiconductor supply chain is undergoing significant diversification in response to the increasing number of countries and companies contemplating, or already implementing, the establishment of manufacturing facilities in various regions. This strategic move aims to mitigate the potential risks associated with supply chain disruptions, stemming from geopolitical tensions and natural disasters. Notably, a pronounced trend within the semiconductor supply chain is the growing emphasis on self-reliant manufacturing.
Furthermore, with the fast-tracked deployment of 5G networks and the widespread application of AI technology, the semiconductor market is currently experiencing substantial demand and raising the technological bar in the semiconductor field. It is foreseeable that the future market will favor those who can provide comprehensive solutions. Moreover, environmental concerns and sustainability are gaining prominence, not only in the semiconductor supply chain but also in various industries. This is driving the development of more energy-efficient and environmentally friendly components and products while imposing higher environmental standards and sustainability requirements on the entire semiconductor supply chain, aligning with the industry trend of sustainable development.
The evolving industry trends bring many challenges to companies playing different roles in the semiconductor supply chain. As I mentioned earlier, semiconductor manufacturing requires significant investment and long-term research and development, which can lead to cyclical issues of oversupply and shortages. Introducing new technologies and limitations in production capacity can result in production lags, especially in the high-end chip sector. Lastly, heightened environmental requirements entail stricter environmental regulations and sustainability demands.
As one of the leading international electronic component distributors, WIN SOURCE adheres to a corporate culture characterized by “precision, efficiency, and inclusivity.” We approach every detail with meticulous and serious attention, whether it’s global procurement, chip analysis and monitoring, or ongoing risk management and strategic planning, all carried out efficiently. We tackle the various instabilities and challenges in the global semiconductor industry with an open-minded and inclusive approach.
EMSNOW: The issue of NCNR (non-cancellable, non-returnable) is being actively discussed in the industry due to its impact on EMS business. How do you view these terms, and do you think they will be lessened or removed?
“NCNR” (Non-Cancelable, Non-Returnable) terms are commonplace in various supply chain and procurement contracts, especially in electronic manufacturing services and other high-tech sectors. These terms are typically used to protect suppliers from potential risks associated with large, customized orders. When a customer places an order with a supplier for products or components customized to their specifications, the supplier may find it necessary to procure raw materials in advance or make significant investments. NCNR terms ensure that the supplier will not incur financial losses if the customer cancels the order or refuses to accept the delivered products.
These terms offer substantial benefits in supplier management, enabling suppliers to mitigate risks more effectively, particularly when dealing with large-scale production or product customization. By doing so, suppliers can extend more competitive pricing, which ultimately benefits the customers. However, these terms have been criticized because they shift most of the risk to the customer. If market demand fluctuates or customers request order modifications for various reasons, they may encounter considerable financial strain. The reduction or elimination of these terms largely hinges on market dynamics and evolving trends in supply chain management. In highly competitive markets, customers may demand more flexible terms. However, for cases involving extensive customization and high investment, NCNR terms may still be necessary. The continuous advancement of technology, the availability of superior forecasting tools, and advanced supply chain management systems have enabled suppliers and customers to enhance demand prediction, reducing their reliance on NCNR terms.
In summary, while NCNR terms provide suppliers with a degree of certainty, they also entail risks for customers. Whether to reduce or waive them depends on market conditions, technological advancements, and negotiation strategies on both sides. Nonetheless, considering the risk management principles underlying these terms, they are unlikely to disappear but will likely adapt and evolve to align with the ever-changing market demands.
As a prominent independent distributor in Asia, when communicating with our clientele, WIN SOURCE diligently emphasizes the advantages of NCNR terms, such as price stability and predictability. This approach helps build trust and enables customers to understand that we are willing to collaborate to address market uncertainties together. Above all, we tailor customized solutions that align with our customers’ specific requirements. While our orders may be non-cancelable and our products non-returnable, we exert every effort to meet our customers’ needs. This includes providing technical support, managing inventory, and offering consistent supply services to ensure their success.
EMSNOW: How does WIN SOURCE help customers find obsolete, end-of-life, and hard-to-find parts?
Procuring rare and hard-to-find components poses numerous challenges, including limited availability, long lead times, risks of counterfeit parts, quality and reliability concerns, compatibility and interchangeability issues, and efficient scrap management. At WIN SOURCE, we understand these challenges, which is why, to address the information disparity in electronic component procurement and transcend the conventional service model of the electronic component supply chain, we pioneered the establishment of Asia’s first overseas B2B e-commerce platform in 2012 (www.win-source.net). Our online platform grants you effortless access to inventory data for obsolete, discontinued, and hard-to-find components. Additionally, we furnish datasheets for your convenience when making online purchases.
Over 23 years of growth and evolution, WIN SOURCE has instituted an intelligent supply chain system that optimizes our business processes. This system enhances coordination and transparency, bolsters business efficiency, and elevates service quality from the very source. Customers can quickly locate the components they require through our system, whether they are scarce, obsolete, or commonly used, and procure cost-effective and quality-assured components.
With our innovative platform and continuous improvements, WIN SOURCE stands as the dependable partner for manufacturers seeking to surmount these challenges successfully. We offer a comprehensive range of components, an efficient procurement process, and an unwavering commitment to consistent quality. WIN SOURCE empowers manufacturers to concentrate on their core competencies, foster innovation, and generate added value for their clientele.
EMSNOW: How does WIN SOURCE help reduce excess inventory of components and be more sustainable?
We are not just a leading electronic component distributor but also experts in managing excess inventory, assisting in monetizing this often resource-consuming liability.
Whether you are a semiconductor manufacturer, a continental component distributor, or an OEM or CEM, over time, you may accumulate a significant quantity of electronic components that are no longer required or have become outdated. Whether your inventory comprises surplus parts left over from completed production runs or a mix of obsolete and scrapped components, we are here to assist you.
Once you submit an inventory list or stock on our website (win-source.net), our experts will assess the value and condition of your inventory. Typically, we can provide the most favorable quote for your entire batch or individual order items within 24 hours. You can then choose from four different options: “Bulk Buy,” “Off-site consignment,” “On-site consignment,” or “A mixture of the three programs” to efficiently clear surplus inventory.
By recycling surplus inventory in this manner, we help our manufacturing clients reduce waste, enhance sustainability to meet current environmental requirements and regulations, and provide an improved customer experience.
EMSNOW: What quality processes/standards do you employ to make sure the parts you acquire are authentic?
First of all, we have implemented a continuous maintenance quality management system to ensure effectiveness and drive process improvements. Our system complies with multiple industry standards, including AS9120B, ISO 9001:2008, ISO13485, ISO28000, ESD-S20.20, and IDEA-STD-1010-B.
Furthermore, we maintain a dedicated quality management team. This team conducts regular assessments to evaluate the ongoing suitability of WIN SOURCE’s quality system through internal audits and comprehensive quality reports. These assessments are based on audit findings, customer feedback, process performance, product compliance, and the status of preventive and corrective actions, as well as previous management reviews.
Integral to our commitment to quality assurance is our in-house inspection capability. Every component undergoes a meticulous inspection and is verified for its source by WIN SOURCE’s quality testing department. We employ advanced methods, such as 200x magnification, solderability testing, acetone verification testing, and more, before these components enter our inventory and are dispatched to end customers.
Additionally, we have developed WIN SOURCE’s unique quality control system, which includes packaging inspections, shipping label checks, visual product inspections, non-destructive testing, and strict adherence to precise environmental and humidity control. This compliance extends to our ANSI/ESD S20.20 handling processes, ensuring operational precision and efficiency.
Lastly, we place significant emphasis on supplier qualification control. Recognizing that the source of components directly impacts part quality, we consistently adhere to the ISO 9001:2008 management system. We maintain rigorous standards when selecting supplier partners, collaborating exclusively with high-standard distributors who meet our stringent supplier criteria. These partners include manufacturers, authorized distributor-resellers, OEMs, CMs, and reputable independent distributors. These partnerships reinforce the integrity of our robust supply chain.
We understand that product quality assurance is paramount because customer trust is our most valuable asset. We hope our customers can purchase WIN SOURCE products with 100% confidence. It’s not just about sourcing suppliers from Asia who can offer competitive prices and advantages; it’s about finding a partner that provides a comprehensive range of products, specializing in obsolete and hard-to-find component procurement, competitive pricing, and highly reliable quality to genuinely maintain the stability of our customers’ supply chains. This enables them to focus more on production research and development.
Our goal is to establish long-term partnerships, grow together with our customers, and provide enduring value to them. Therefore, choosing Win Source means selecting a trustworthy partner with diversified product offerings, competitive prices, and outstanding quality assurance, allowing you to concentrate on your core business with peace of mind.
EMSNOW: How do you think the rest of 2023 will be for component availability?
Since the beginning of 2023, a series of transformations have unfolded in the wake of the Chip Wars and the rise of Artificial Intelligence (AI). While the most severe chip shortage, spanning from 2020 to 2022, came to an end in late 2022 and early 2023, the electronic components market continues to experience significant turbulence.
As we enter the latter half of this year, the overall chip market demand remains subdued. Recent financial reports from several manufacturers reveal strong demand within the automotive sector. However, the consumer electronics market still contends with destocking challenges and a dearth of new orders. OEMs had previously increased their forecasts significantly due to the exponential surge in demand for mobile computing devices. Nonetheless, they now confront considerable overstock. Presently, with millions of unsold products, OEMs are canceling component orders and delaying the release of new products until they can clear a significant portion of their inventory. Hence, demand in other end-user markets, aside from the automotive sector, remains tepid.
Evidently, this year’s electronic component supply chain is progressively ameliorating, albeit at a gradual and uneven pace. Factors influencing capacity, costs, delivery timelines, and other considerations endure, and constraints and shortages have not entirely subsided. The multi-layered electronic product supply chain operates in a complex, ever-changing environment where constant shifting and unpredictable events occur. Access to available supply will hinge on multifarious factors, including supply chain conditions, inventory levels, production cycles, market demand, supplier relationships, alternatives, and compatibility. Companies must uphold vigilant market insights and demonstrate flexible adaptability to navigate these changes effectively, ensuring customers can secure the requisite electronic components.
Confronted with the evolving availability of electronic components in 2023, WIN SOURCE will implement various strategies to address these challenges. Primarily, we will emphasize diversification of our supply chain by forging partnerships with manufacturers and distributors across different global, mitigating dependence and ensuring supply stability. Secondly, vigilant market monitoring will prove pivotal, as proactive tracking of market trends and supply chain dynamics will empower us to detect potential issues early and take prompt action.
Moreover, inventory management will play a significant role as we maintain appropriate stock levels to alleviate supply chain pressures.
EMSNOW: Is there anything else you would like to say to the EMSNOW audience
Dear EMSNOW readers,
First and foremost, we sincerely appreciate the opportunity to collaborate with EMSNOW magazine. This partnership provides us a platform to introduce and showcase our capabilities to customers, fostering a deeper mutual understanding and paving the way for long-term, meaningful cooperation. As stakeholders in the semiconductor industry, we deeply understand the significance of this sector and the challenges it faces in supply chain management. This is a moment brimming with opportunities and transformations, and we take great pride in actively participating and offering innovative solutions to our customers.
Furthermore, WIN SOURCE has forged strong partnerships with numerous semiconductor manufacturers, suppliers, and collaborators to ensure that our customers consistently have access to the latest technologies and high-quality products. We firmly believe that, in the future, it is only through collective efforts that we can address the industry’s challenges and achieve shared success.
Lastly, we hope all businesses, not just our existing partners, will recognize WIN SOURCE. We want them to know that within WIN SOURCE, the largest electronic component marketplace in Asia, they can efficiently source products that are challenging to find elsewhere while also saving on production costs for commonly used components, ultimately enhancing their competitiveness in the market.
