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Chinese Component Distributors See Higher Sales

Published: 16 June 2009
 by Staff
HONG KONG -- Eighty-nine percent of mainland China's electronics component distributors expect revenue to grow in 2009, forecasting an average increase of 13%; while 55% of mainland China electronics manufacturers surveyed said the economic downturn has had little or no impact on their business.

The results were revealed in the ninth Annual Electronic Components Distributor Survey conducted by Global Sources.

This year, the firm asked 326 senior managers who are working for components distributors and 1,243 senior corporate, purchasing or procurement managers from electronics manufacturing companies operating in mainland China about their current challenges and plans for the future.

Mainland China manufacturers well equipped to cope with change

The survey revealed that 55% of manufacturers want to work with local distributors in the coming months, an increase of 18% compared to last year. However, 32% still prefer to work with Hong Kong, Taiwanese and international distributors. Other results include:

  • Manufacturers order 54% of their components directly from distributors.
  • Seventy-eight percent of manufacturers plan to either increase their purchases from distributors, or keep them the same, this year.
  • They are selecting distributors based on availability of onsite engineering support (48%), reference design (45%), test service (30%) and development tools (28%).

Mainland China distributors are also shifting their strategy to grow their business. An increasing number of them are now focusing on serving medium- and small-scale manufacturers rather than larger-scale outfits.

Distributors have also implemented a number of steps to ensure the quality of their components in reaction to the demands from both the mainland China and global consumer market. These include strict supplier approval; employee training; third-party testing; purchase testing equipment and ISO certification.

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