Relying on single-source components is one of the riskiest moves an engineer can make to ensure design success. Single source parts, which have only one manufacturing location, constrict your supply chain options and pin your product&rsquo;s future to a sole option. But what happens if that option disappears, has limited availability, or becomes so expensive you&rsquo;re unwilling&ndash;or unable&ndash;to buy at the offered price?It&rsquo;s important to understand when and why single-sourcing occurs. While specific components may differentiate your product or deliver other rewards not available from substitutes, a redesign may identify a workaround that saves time, money, and frustration that inevitably happens when your only choice becomes under-sourced or unavailable.In rare instances, a single component may be the only choice you have. But this strategy irrevocably ties your production to another company&rsquo;s dependability. Risk mitigation demands having a strategy to untie the connection if a worst-case scenario occurs. Here are our tips for protecting your production from single-sourcing uncertainty<h3>Tip #1: Have a Plan in Place</h3>While it&rsquo;s impossible to plan for every possible outcome, a general plan for probable disruptions is not only wise, it&rsquo;s a necessary step in protecting your business from lost time, lost revenue, and production stops.&nbsp;This plan should include regular updates organizing and tracking single-source component availability. Use online information from electronic part search engines and datasheet databases to keep you up-to-date on pricing, availability, and compliance status, as well as any changes in the manufacturer&rsquo;s business structure that could put your sourcing in jeopardy.If you want to go further, consider performing a monthly or quarterly review of any additional factors likely to impact proper supplier operation. This may include trade, tariffs, weather impacts, political changes, or even holidays like Chinese New Year. The sooner you recognize possible roadblocks, the better you can plan around them. This sort of deep audit analysis can save your company dozens if not hundreds of hours of back-and-forth searching for that one all-important component keeping your production at a standstill.Additionally, you must understand which parts have only one source. If a part can be located and purchased through multiple distribution channels businesses may consider it to be a multisource component. However, if these distributors are sourcing from a single manufacturer, the part has a single brittle derivation point carrying risk to your final production. Check down to the manufacturing level to ensure components are built in several locations.<h3>Tip #2: Track Critical Component Lifecycle</h3>Cut the risk of single-source components with visibility into the product lifecycle. Components evolve, reach maturity, enter end-of-life final purchase status, and then reach obsolescence. Each stage offers different availability and cost. Once a component reaches end-of-life, you may see a significant final-buy price uptick, especially if the component remains in demand.By maintaining visibility into the component lifecycle, you can prepare a proactive approach. This offers opportunities to find and inventory components while they remain available so you have no delay in the manufacture of your product.This also gives you a chance to minimize costs through a design refresh based upon forecasted obsolescence dates. It&rsquo;s better to create an adjusted design before items become too expensive or hard to find, letting you maintain focus on product design rather than on existing sourcing problems. The last thing you want is to be surprised by an EOL announcement.<h3>Tip #3 (with a caveat): Shift from Just-in-Time to Just-in-Case</h3>In good times when everything is functioning smoothly, lean supply chain management is ideal. A JIT approach minimizes warehousing costs by purchasing components only as you need them, prioritizing efficiency over risk.But when risk is already baked into the supply chain due to external factors, it may be time to consider a just-in-case approach instead. This strategy purchases stock ahead of need, maintaining weeks or even months of on-hand critical components to ensure business continuity regardless of external pressures.JIC buying must factor in warehousing and other costs, but it can be an effective high-risk mitigation strategy. Additionally, companies like <a href="https://help.macrofab.com/knowledge/how-do-i-consign-materials-and-how-do-i-select-my-inventory-when-using-the-macrofab-bom-tool?utm_source=hs_email&utm_medium=email&utm_content=recent_teams_release&utm_campaign=Q4" target="_blank">MacroFab can provide consignment services</a> to warehouse and inventory components for your future manufacturing needs.But there&rsquo;s a caveat: this strategy can backfire. It is possible for JIC buying to lead to an oversupply situation. This happens when lowered demand or shifting design needs leaves purchased inventory unused. If you choose to employ JIC buying, make sure to carefully consider your needs for the coming months and make sure to only buy for predetermined needs.Additionally, if too many companies employ JIC buying at the same time, phantom demand can push up component prices. However, once the rush to buy is over and demand stagnates, prices drop. If a company caught early in the buying cycle has leftover inventory, they may be left with a lose/lose decision: hold on to components they may never need, or sell them at a significant loss.<h3>How to Lower Single-Source Component Risks</h3><img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjUxMDczMjM0NjE3LTE2NTEwNzMyMzQ2MTcucG5nIiwiZWRpdHMiOnsicmVzaXplIjp7IndpZHRoIjo5NTAsImZpdCI6ImNvdmVyIn19fQ==" alt="How to Lower Single-Source Component Risks" class="fr-fic fr-dii" style="width: 390px;">The best strategy for single-source componentry is removing the risk altogether. Consider building an alternative parts strategy offering comparable alternatives to expand your sourcing. Designating reliable swaps helps build out your inventory plan so production time is never held up. It also provides you with a predetermined and pre-tested alternative if it&rsquo;s needed, rather than putting you in a situation where an alternative has to be found at any cost. If you&rsquo;re unable to do this in-house, your CM can help.Additionally, reach out to your CM to review how they can help with your strategic sourcing. Contract manufacturers often have deeper and wider sourcing options to pull from and have spent years building a secure and vetted supplier list. They may have resources you don&rsquo;t know about or don&rsquo;t have access to.MacroFab tailors sourcing strategies to your needs. Expand your sourcing using our experienced in-house team and our expansive, vetted vendor options. Build a plan that will maintain your necessary parts while reducing lead times and improving forecasting, keeping your production on track. MacroFab can even help manage and ship after-build inventory.<a href="https://macrofab.com/rfq?utm_source=hs_email&utm_medium=email&utm_content=recent_teams_release&utm_campaign=Q4" target="_blank">Reach Out To Learn More</a>

An unavailable single-sourced component can stop production

Relying on single-sourced components is a risky move that constricts your supply chain options and pins your product's future to one option.  

What happens if that option disappears?  We have tips that can protect you from single-sourcing uncertainty. 

Tips for Reducing Single Source Component Risk

Electronic product development is a highly iterative process that involves going back and forth between the design and manufacturing stages. Cloud Manufacturing Services make it possible for engineers to focus on innovation.


Cloud Manufacturing Services Deliver New PCB Possibilities

The first stage of a successful proof of concept for a new electrical project is a working prototype. In complex projects, PCBA prototyping establishes design feasibility and future manufacturability. This process takes ideas from paper through the design stage to a functional demonstration.However, prototyping can become inefficient if basic rules are ignored. Prototyping unique, untested processes typically happen as small-volume runs. But too many one-off builds create inefficiencies, leading to increased costs and lost time. Luckily there are several tried and true strategies that can help you lower costs and effort while saving time on your next PCBA prototype.<h3>Choose a CM Partner for Your Entire Order</h3>When searching for a CM with the capability to build your prototypes, the inclination is often to find a small-batch supplier specializing in prototypes. However, this can cause future delays when you need to roll prototype development into final manufacturing; your new manufacturing partner has no history with your job and begins the manufacturing process with zero knowledge. Building knowledge must begin all over again. This takes time and effort.A faster and often lower-cost strategy is to identify a CM manufacturing factory network with both prototyping and volume manufacturing capabilities. A digital manufacturing company can communicate information between customers, suppliers, and manufacturing partners, maintaining order information within a digital thread through a central platform. This enables a seamless transition from prototyping to production by leveraging shared learnings from the prototype stage forward.<h3>Communicate with your CM</h3>Your chosen CM should be your partner in the prototyping and development process. Communicating with them throughout the project not only enables your CM to build your project better, it also saves you time and effort and minimizes re-work.Involve your partner early in your project and discuss design changes to avoid fabrication issues down the road. This includes clearance issues, material choices, stack-ups, or other special requirements.Your CM can also help you determine when and where simpler or less expensive processes or materials will suffice without compromising design integrity. They can suggest alternative parts with better price or availability. This is an important step to cut costs, especially as prototypes move into larger production runs. Additionally, good communication now can identify any possible design omissions or challenges. For example, a small, congested board creates assembly challenges (and associated costs) that can be reduced with some simplification.<h3>Component Selection Matters</h3>Additionally, it is a good idea to add alternative parts to your BOM. This allows a CM to order backup components when the primary is either unavailable or has a prohibitively long lead time that could delay a prototype build. While component cost may be critical, the availability of the entire BOM is critical to preventing unwanted prototyping delays.<h3>Discuss and Use a DFM with your CM</h3>A design for manufacturing (DFM) plan is the guide for bringing a new product to production. This process starts during the design phase, but it is first tested during prototyping. It details the BOM, processes, capabilities, and technologies needed for new product production.A good DFM will verify layout, board complexity, via placement, surface finish, and other board specifications to ensure every process, procedure, and component works as it should. This manufacturing framework ensures smooth prototype execution and is designed to cut down on rework and unneeded iterations. Work with your CM during the design and prototype stage to implement your DFM to save time and costs.<h3>Consider All Costs</h3>While the prototyping stage is not a long-term recurring event, it may be easy to neglect all the hidden and potential costs associated with decisions at this stage. While prototyping costs end at assembly and components, timely prototyping success will gate your design progress. Potential delays can impact the overall project&rsquo;s value.Always consider delay and idle time impacts. Additionally, future production costs should always factor in. Using unique or hard-to-find components as part of your design when more common items will suffice will have far-reaching impacts on production costs and timelines. It could even result in a redesign sooner rather than later.Additionally, a single board prototyping run may prove less cost-effective than building multiple boards. Extra boards offer a chance to further test and tweak a design before running another iteration. Work with your CM to ensure you&rsquo;re choosing the most cost-effective option. Digital platforms like MacroFab can easily toggle production size to let you compare different pricing options.Building your PCBA prototype is an essential milestone to showcase the capability of a new project. But it&rsquo;s only the first step in a larger process. Make sure to keep the focus on the real goal: creating a quality product that can be manufactured successfully at scale.Using the tips mentioned above will help you save time, money, and effort and minimize waste as you work through the prototyping process and move to manufacturing at scale.

It takes focus to create a quality product. 

PCBA prototyping establishes design feasibility and future manufacturability.  Here are tried and true strategies to lower costs and effort to save time on your next PCBA prototype. 

Five Ways to Prevent Waste on PCBA Prototyping

The PCB supply chain has come under unprecedented strain, with surging material and energy costs, bottlenecks caused by resurgent post-Covid demand, disruption in China, and geopolitical uncertainty all creating a perfect storm.&nbsp;PCB manufacture takes the challenges associated with supply chains to another level due to the sheer diversity of components and raw materials needed. The greater the number and types of materials, the more vendors, manufacturers, and transport methods become part of the equation. &nbsp;In this article, we will look at the central issues impacting PCB supply chains, how and why they have had such an impact, and examine the measures which can be taken to deal with those challenges.<h2 dir="ltr">Disruption in China&nbsp;</h2>Over the last two decades, China has moved to dominate the PCB market and this has been reflected in the sector&rsquo;s decline elsewhere. From 2000 to 2015, the number of PCB manufacturers in the USA shrunk from 2,500 to just 145.&nbsp;The former administration hit back with tariffs on trade which impacted on the import from China of some components used by PCB manufacturers.&nbsp;In addition to trade issues, the Chinese manufacturing sector has struggled with power&nbsp;and labor shortages, while the hard-line approach taken by the government in controlling Covid outbreaks has also led to disruption. Last August the Port of Ningbo&mdash;the world&rsquo;s third busiest&mdash;was closed because of a single COVID-19 case. Earlier in the year the Port of Yantian&mdash;the world&rsquo;s fourth busiest&mdash;shut down due to 150 cases.Skittish about these issues, a report by Gartner&nbsp;found this had led businesses to pull back on integration and try to find ways to keep supply chains more local.<h2 dir="ltr">ESG</h2>Something which is becoming increasingly prominent is Environmental Social Governance (ESG). Companies and consumers increasingly want to do business with firms that can prove they are mitigating the impact on the environment.&nbsp;It will become increasingly important to source PCB materials in a way that keeps a company&rsquo;s carbon footprint to a minimum. In a practical sense, this could mean dealing with a supplier that is closer to their manufacturing base and could supply them by rail or road, even if cost and reliability is less attractive than sourcing them from a supplier further afield which has to fly them in or transport them across oceans.&nbsp;<h2 dir="ltr">The global impact of Covid</h2>The pandemic had a dual impact on PCB manufacture, increasing demand while at the same time constricting supplies. In the early days of the pandemic, Covid&rsquo;s impact on China caused significant disruption to global supply chains in the electronics industry with around 30 PCB makers centred around Wuhan alone.&nbsp;In early 2020, IPC, an electronics equipment trade organization, surveyed 150 electronics suppliers&nbsp;and manufacturers which found 65% reported delays from suppliers. As economies went into lockdowns, the need for many goods, supplies, and energy also fell off a cliff. But as those lockdowns lifted that appetite rebounded sharply. But this caused bottlenecks, with supply chains unable to match resurgent demand.&nbsp;This was compounded by an increased requirement for electrical devices prompted by industries which underwent a boom as a result of Covid, notably the medical industry and anything related to remote working. &nbsp;But another impact which Covid had, was a shift in philosophy. Firms had to operate under new restrictions, they had to find new and smarter ways of doing business and keeping things flowing, and that has left a lasting impression.&nbsp;A survey of business leaders by Mckinsey&nbsp;found 93 percent intended to make their supply chains far more flexible, agile, and resilient in the coming years. A study by KPMG&nbsp;found this had brought about a fundamental shift in priority from cost to resilience. This is a fundamental shift which can not be overstated.&nbsp;<h2 dir="ltr">Conflict in Ukraine&nbsp;</h2>With the world already witnessing pressures on supply chains due to bottlenecks caused by a rapid global bounce-back in post-Covid demand, the Russia-Ukraine crisis has caused even greater uncertainty.&nbsp;A report by Dun &amp; Bradstreet&nbsp;found more than 600,000 businesses around the world rely on Russian and Ukrainian suppliers, while the conflict is also increasing pressure on energy prices, with research revealing that European gas storage levels are &lsquo;critically low&rsquo; at 33% of capacity.Some raw materials such as neon, C4F6, palladium, nickel, platinum, rhodium, and titanium, are exported from Russia and Ukraine and the conflict could lead to a spike in prices, according to research company Counterpoint. With neon and palladium especially central to PCB production, the shocks could be felt by manufacturers the world over.&nbsp;Despite this, some chip companies&nbsp;in the USA said they expected limited supply chain disruption due to the conflict due to the stockpiling of raw materials and diversified procurement, but some industry experts said there could be an impact in the longer term.<h2 dir="ltr">Supply chain resilience&nbsp;</h2>But what do we mean when we talk about resilience in the context of supply chains? In essence, it refers to a company&rsquo;s ability to maintain the flow of the materials and resources it needs in the face of both long-term strategic challenges &ndash; such as geopolitical instability &ndash; or shorter term, unpredictable problems such as adverse weather or the collapse of transport companies such as shipping firms or airlines.How able and ready is a particular company to shift from one method of transporting what it needs to another if a route or means of bringing in what it needs is blocked? How quickly can it move to a different supplier if, for example, sanctions are placed on its current one or a border is closed?&nbsp;The reason it matters is that without a reliable supply chain, companies can neither maintain operations for very long, nor can they make long term plans. Unless supply chain contingencies are in place which are robust and reliable, companies can find themselves &lsquo;firefighting&rsquo;, where they are constantly looking for new suppliers and new transport methods, this can lead to even higher costs and an unpredictable flow of the supply chain.&nbsp;<h2 dir="ltr">Building resilience&nbsp;</h2>Building a resilient supply chain is all about having alternatives that can be switched to at short notice to mitigate disruptions and keep things moving. As mentioned earlier, cost is now less of a factor for business leaders than whether these measures will work.&nbsp;The main methods of building this resilience are:<h3 dir="ltr">Diversify supply chains:</h3>One of the most effective ways to ensure supply chain resilience is to diversify suppliers, with a combination of offshore and near-shore suppliers for each component. Another strategy is to have a regional supply chain as well as a global one, providing a built-in redundancy so that if one is impacted then another can be relied upon.<h3 dir="ltr">Be agile:</h3>Companies must change their mindset about how rapidly they can pivot to secure supplies from different manufacturers. This is a legacy from how companies that survived and even thrived during the pandemic, were able to make quick decisions and bring forward changes in a matter of weeks and months which would have otherwise taken years.A survey of executives by McKinsey&nbsp;found that their companies had accelerated the digitization of their customer and supply-chain interactions during the first six months of 2020 at a rate that would normally have taken them three or four years to achieve.Changing how big companies operate used to be likened to turning around an oil tanker, but with management and leadership that now have this new mindset, adapting in the face of supply chain issues can be done quickly.Part of this mindset also involves scanning the horizon for possible problems. We should now be trained to expect disruption. So what issues are likely to arise next month or even next year that may have an impact? With that in mind, what are the people at your company doing about it now?<h2 dir="ltr">Conclusion</h2>Supply chains are under unprecedented strain. China&rsquo;s systemic problems have been exposed in recent years, while Covid has created a bottleneck of demand. The Russia-Ukraine crisis and wider geopolitical uncertainty is also creating uncertainty.One of the deeper impacts of Covid was to make companies reassess both their ability and willingness to quickly pivot to new ways of working, and that has left a legacy. They are looking for resilience now as the main factor in their supply chains rather than keeping costs low.&nbsp;They want and need to be able to maintain integrity in the event of short-term shocks and longer-term challenges.To do this, supply chains must be diversified with regional and global suppliers both part of the solution, while a willingness and readiness to be flexible and adapt quickly to challenges is also a central pillar of maintaining that resilience. Building reserves of vital components is also an important part of the solution.By undertaking these measures, companies can maintain supply chains in the face of headwinds both now, and further down the line. &nbsp;<h2 id="isPasted">About the sponsor: MacroFab</h2><a href="https://macrofab.com/" rel="noopener noreferrer" target="_blank">MacroFab </a>is an electronics manufacturing digital platform that provides production options throughout North America. MacroFab aims to make it faster and easier to bring new electronic products to market through their software-driven approach to electronics manufacturing.&nbsp;<img src="https://images.wevolver.com/eyJidWNrZXQiOiJ3ZXZvbHZlci1wcm9qZWN0LWltYWdlcyIsImtleSI6ImZyb2FsYS8xNjQ3NDE4MTAwMjA0LW1hY3JvZmFiIGJhbm5lciBib3R0b20uanBnIiwiZWRpdHMiOnsicmVzaXplIjp7IndpZHRoIjo5NTAsImZpdCI6ImNvdmVyIn19fQ==" style="width: 788px;" class="fr-fic fr-dib"> <h2 dir="ltr">References</h2>1. &nbsp;<a href="https://www.forbes.com/sites/erictegler/2021/06/30/americas-defense-electronics-supply-chain-is-dangerously-thin-and-falling-behind/?sh=44fe27cd2c3b" rel="noopener noreferrer" target="_blank">https://www.forbes.com/sites/erictegler/2021/06/30/americas-defense-electronics-supply-chain-is-dangerously-thin-and-falling-behind/?sh=44fe27cd2c3b</a>2. https://www.nytimes.com/2021/10/13/business/china-electricity-shortage.html3. https://www.wsj.com/articles/chinese-factories-are-having-labor-painswe-can-hardly-find-any-workers-116298838014. https://www.gartner.com/smarterwithgartner/diversifying-global-supply-chains-for-resilience5. https://www.tti.com/content/ttiinc/en/resources/marketeye/categories/industry/me-custer-20200219.html6. <a href="https://www.businessinsider.com/coronavirus-causing-delays-in-the-electronics-industry-2020-3?r=US&IR=T" rel="noopener noreferrer noopener noreferrer" target="_blank">https://www.businessinsider.com/coronavirus-causing-delays-in-the-electronics-industry-2020-3?r=US&amp;IR=T</a>7. https://www.mckinsey.com/business-functions/operations/our-insights/how-covid-19-is-reshaping-supply-chains8. https://home.kpmg/uk/en/home/insights/2020/09/uk-ceo-outlook/the-no-1-risk-to-your-business-your-supply-chain.html9. https://www.dnb.com/perspectives/russia-ukraine-impacts-global-supply-chain.html10. https://www.counterpointresearch.com/ukraine-crisis-brings-fresh-wave-uncertainty-semiconductor-industry/11. <a href="https://www.cnbc.com/2022/02/24/chipmakers-see-limited-impact-russia-invasion-ukraine.html" rel="noopener noreferrer noopener noreferrer noopener noreferrer" target="_blank">https://www.cnbc.com/2022/02/24/chipmakers-see-limited-impact-russia-invasion-ukraine.html</a>12. https://www.mckinsey.com/business-functions/strategy-and-corporate-finance/our-insights/how-covid-19-has-pushed-companies-over-the-technology-tipping-point-and-transformed-business-forever

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Tips for Reducing Single Source Component Risk

Cloud Manufacturing Services Deliver New PCB Possibilities

Five Ways to Prevent Waste on PCBA Prototyping

Supply Chain Resilience For PCB