pain of MOQs & distributors

Whats up with all the IC manufactures, and their ever increasing packaging quantities? In the days DIPs the MOQ were only 20 or 25, then came SOP and MOQs jumped to 100 pieces (quite acceptable for small production runs) , but now with all the micro sized SMD, such as SOT23-8/ MSOP/uSOP, the MOQs are like 1000 or 3000 pieces. Whats the deal with the massive jump between the sample quantities, and package quantities ? What is supposed to happen to all the manufactures who do small production runs and are stuck in this middle gap ? Is it just normally accepted a part suddenly becomes 10 times the listed price simply because 90% of the component reel will just go to landfill ?

Understandably, none of the OZ distributors hold stock on parts unless they have multiple customers buying them. Also, with so many ICs around, the probability of any two customers buying the same part becomes increasingly lower. I would like to know how other people cope with purchasing, or am I just in the wrong country with the wrong profession ?

Adam

Reply to
Adam S
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It's the old supply and demand.

All Silicon MFGs target high dollars with their MOQ requirements,

so

High dollar cost per part... Eg FPGAs etc = LOW MOQ

Low Dollar cost per part... EG small pin SOT23 part = HIGH MOQ

Both typically come to the same dollars

Some times there are exceptions to the rule...

Speak to "some in the know" from the Distributor - they may be able advise a "promote" part.. that might fit your requirement.

Otherwise companies like Farnells have a valued service ... in stock.... but you pay for it.

JG

Reply to
Joe G (Home)

Well, being in Australia certainly doesn't help! :->

But this is what Farnell, RS, Digikey, Mouser etc are for. It's not at all difficult to design most if not all of your new product around parts available off-the-shelf in one-off QTY from these suppliers. If you are in a low volume market then you try to factor the higher component cost into the product price. People complain about the high price of Farnell etc, but really they (semis in partiular) often aren't much more than what the distributor will charge you for low volume. If you are in the unfortunate situation where you need low volume, short lead times, *and* a rock bottom sell price then you've got to be extra careful on your parts choice at design time.

Dave :)

Reply to
David L. Jones

Adam S wrote in news:44e4551a$0$29983$afc38c87 @news.optusnet.com.au:

I work in the middle gap too and share the pain bought on by distributor policy. We have a branch in Asia and this brings opportunities for lower component prices. The common myth is that you can only buy huge quantities there, but many distributors want low volume customers too. Prices are 30-

70% of local suppliers but you have to watch freight and shipping overheead costs closely. I find in low/medium volumes in Aus you cannot afford to be unreasonably loyal to the distributors. Have you noticed how the number of distributors is reducing all the time?

With the governments policies, manufacturing will die (the government thinks this is good). But who is gonna make the stuff here for exports to offset the balance of payments?

Reply to
Geoff C

Every time I've checked the factoryMOQ pricing vs one-off from Farnell, I've found a ratio of very nearly FIVE. That's the premium you pay for the privelege of being able to buy one.

We had a particular board a while back which used a slightly hexy SMD tant. These were ~$16 each ex Far(ke)nell. My local parts man said "geez, I can do them for $3.20 each" but when I asked MOQ he said either 1500 or 2500. We weren't about to shelve $5K-odd of one component just to get a better price for a couple of dozen, so Farnell got the business and we stayed in business.

Reply to
budgie

Chicken-and-egg. It's as much because of THEIR policy of not warehousing anything but sticking to factoryMOQ to cover their own arses as it is to any lack of "loyalty" by the buyers. If we could buy 50's instead of 2500's ex the distributor, he'd have a flourishing business.

Iron ore, gas, uranium, Mitsubishi 380's (hang on a minute .....)

Reply to
budgie

The MOQ problem is precisely why I started the

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site. There are now about 450 different types of components listed on there. The more we have listed the more you are liable to find what you need. So if you have some excess inventory put it up there!

I think the biggest problem now is that a lot of the so called distributors are non-stocking (except for parts which are on schedules for a manufacturer). So every time you want something it's MOQ, MOQ, MOQ!

Alternatively, for very small runs, you have to go the Farnell or RS or similar and pay the prices. I must admit I tend not to buy from them as I try as much as possible to stick with my stock parts in new designs. Even so I still end up having to buy some processors in the hundreds and had to resort to buying a 1000 DTMF decoders in SMD because I couldn't get them otherwise.

Another problem is with manufacture in Australia. The big boys tend to get it done overseas while us smaller guys have to have it done locally and try to get parts at the right price.

I think there are places around that sell 'mini' reels of components. They basically just take a full size reel and split and rewind onto smaller reels. You pay a premium of course so you may get say one sixth of a normal reel for one half the price. I'm sure I've seen at least one such supplier.

Alan

-- Sell your surplus electronic components at

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Reply to
Alan

The Government doesn't seem to think we have a problem with $2 to $3 billion (negative) balance of payments each month. What is the National Debt (not Government debt) now? Over $500billion and rising all the time.

Time to break out the bananas? Oops - sorry - they're too expensive now!

-- Sell your surplus electronic components at

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Reply to
Alan

I don't blame them really. They can't possibly stock every component, or even just a fairly basic range, otherwise they'd become another Farnell/RS with all the associated overhead.

What one person thinks might be a "standard" part is not a standard part for some other guy. The distributor knows this and don't want to get stuck with the excess that they can't move.

If they started to stock a lot of stuff then they'd have to increase their prices to compensate, and everyone would start complaining. So they stick with not stocking much at all.

I think the market is served excellently for small/med run stuff by Farnell and the like, and fairly well by the dealers when you want a lower price and higher volume. Can't have the best of both worlds.

I've found most of the time the problem is the lead time from the factory, not the MOQ.

Farnell sell lots of mini-reels, and prices usually aren't too bad.

Dave :)

Reply to
David L. Jones

I was led to believe the debt is primarily private debt ? if thats the case what would you have the Government do ? Waste the surplus paying for someone's plasma ?

Reply to
atec77

Cost of storage of the components, cost of keeping slow moving items, etc. No one wants to break a reel or tube, 'cos the disty's can't sell a broken reel. It's also why Farnell and the others can charge what they want because their business is keeping and selling slow and fast moving items, and everything in between. They can absorb the costs in their charges.

I've never seen or heard of 90% of a reel of components going to landfill. That's just sheer economic nonsense. If someone is stuck with unwanted components they can sell them off to someone else who'd want them. There's plenty of people around who purchase components simply to sell them off at a future time worldwide. The manufacturer can also notify some websites that they've got stock of components and anyone can bid for them. Ebay is another option.

Quite often multiple customers purchase the same part because it has the same set of requirements and performance. Also possibly because the disty has ONLY that part, and some compromises may have to be made in the design.

Check on google for your required components. There's a number of sites that have lists of who's got what, and you can bid for them.

Also, check with your board loaders. They MAY have some excess part reels of components from other jobs. Duet in Melbourne also had a range of passives, but could have some other semis, particularly common ones like BAV70's, 78L05's (SO8), etc. I don't know if they're still in business though.

What specific components are you looking for, and how many?

Reply to
dmm

There is a wonderful little distributor here in NZ, Surface Mount Devices:

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they have very good pricing, and make up little reels, of as many (or few) parts as you like. Their semiconductor range isnt huge, but they have a *LOT* of 1206, 0805 and 0603 discretes. Every time I need a resistor, I buy 1000 for about NZ$15.

they have also been very helpful in terms of bringing in parts - basically they buy the reel, sell you as many as you want and add it to their catalogue.

they also have an SMD handbook, which has all the footprints, and even better, a big list magic part number x-ref.

Cheers Terry

Reply to
Terry Given

Welcome to the global economy. Aus cant manufacture, and anyone who says we can needs to check out the operations in places like Taiwan or China. Any who says we need to get it back should put up or shut up, cause you will need to work for nicks. In taiwian, the plants have apartments above for the workers. The workers over dont pull sickies, they dont have IR reforms and they dont have unions. And even better, they dont whinge and are happy to have a job.

As for MOQ. Well try feeding 100 smd parts into a pick and place. PArts like resistors have an initial waste of 100+ if you dont have a leader on your reel. Sot23 ect is the same. It is really not worth getting prod runs manufactured in AUS, when you can get runs as small as 100 done overseas.

Reply to
The Real Andy

Australia can and does manufacture goods and exports them to the world. GMH Ford Toyota Mitsubishi (well, at least for a while yet) Radio Frequency Systems Vision Systems Daronmont Technologies Bosch, Delphi, and all the other companies that support them by providing products and services for the final products.

These are just a few. There are others, but I couldn't be bothered.

GMH and other large manuf's can export their product because they have alliances with other companies, and the governments in some other countries would have lowered or eliminated some tariffs. The Monaro here is called the Vauxhall something or other in England.

Don't you work for a engineering consultancy, or something similar Andy? Your company would have to organise manufacturing of your products, whether it's metalwork, plastics or electronics.

Electronics manufacturing is relative anyway. Modules (boards) get designed here, but made overseas. The boards can be returned here to be tested/programmed and included into final product, or it can be done overseas. It doesn't mean that ownership of the design goes overseas. If it costs less to manufacture, and you can sell your product for the same price, then you've got more money to invest on improving, or increasing the range of your product, or increasing the size of your company. The Feds have incentives for spending on r&d.

Well, if you've got a reel of 5K resistors, and they're about 1/10 cent each then it's not really worth trying to recover the first wasted 100. Tants and low esr electrolytics are another matter.

BTW, Taiwan does have unions. Its just that they aren't as powerful as unions here, since martial law was lifted in the mid-nineties.

Reply to
dmm

It's not very successful. In fact, it looks like a partial inventory of someone's garage junkbox, full of 2nd hand devices. I probably have a wider range of parts, and I've never worked in the electronics industry.

Not that it's a bad idea, but tell me, just how many individuals have listed parts there? It's not just *your* junkbox is it?

Reply to
Clifford Heath

Does it have to be "very" successful. It's just a free service if people want to use it. And, yes, there are some "pulls" listed on there by someone but maybe some of those things are just what someone else needs. And what is successful? You could say e-bay is not successful if you look at the number of items which are put up for auction repeatedly without selling. Yet the items that do sell make it "successful" - at least for those sellers! The same applies to any classified ads sections on both the web and in print.

Good for you having a wider range of parts. Perhaps not everybody else has, or can't afford to have, whether working in the industry or not.

If you don't want to use the service then don't. I certainly wont be upset about it. And no, it's not just my "junk box". In fact the few items I do have listed on there are new (apart from some eproms).

Thanks for your words of support.

Alan

-- Sell your surplus electronic components at

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Reply to
Alan

Hi Allen - let's hope it continues to grow - good job! Those who frequent this NG regularly would no doubt recall the proposal / consultation process when you first set it up. I think Clifford has had a charisma bypass - no offence intended Cliffy : )

Reply to
Rob

Onyer Alan, If I didn't have so much stuff I'd be inclined to list some of it with you.

Reply to
Mark Harriss

Thanks Rob and Mark for the encouragement!

Mark, you can list things on the site if you want, although it was primarily set up for the guys down here. I guess the UK is still pretty well served with distributors. I think there were a couple of hundred companies in the UK in the late 80's (including my own) whereas I doubt there are more than say 50 down here.

Regards Alan

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Reply to
Alan

Hi Alan, I am in Australia, that's my spam address

Reply to
Mark Harriss

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