Companies do not compete against other companies. In reality, supply chains compete against other supply chains. Efficient supply chain management minimizes liability and reduces overall cost. Firstronic utilizes a global supply chain that includes both distribution and custom part manufacturers.
In addition to selecting suppliers who represent the best in quality, competitive cost and dependability, Firstronic leverages its supply base expertise as part of design for manufacturability/testability (DFM/DFT) recommendation development. PCB fabricators may provide input on optimum layouts for boards and test fixture suppliers may recommendation on the best layout for test coverage. Suppliers also proactively provide updates on component lifecycle trends. This information is added to the overall recommendations Firstronic’s team makes in its new product introduction (NPI) process and during the ECN process if applicable.
To minimize liability yet support variable demand, both raw materials and finished goods inventory kanbans are established. Suppliers agree to a bonded inventory based on each customer’s forecast and likely variations in demand. A finished goods kanban is also in place and is normally sized to cover two weeks of demand. Firstronic builds to forecast and pulls on demand. In the event demand changes radically, forecasts and bonds are revised. Its Plex Online ERP system further reduces transaction costs within the supply chain by supporting a two-bin kanban system with suppliers.