Partstat FAQ for Contract Manufacturers
Original equipment manufacturers (OEMs) are not the only entities who benefit from the many solutions offered by Partstat. When leveraging Partstat solutions, contract manufacturers are poised to see significant improvement in their own processes and in relationships with OEMs. To help illustrate this, we have compiled a brief list of frequently asked questions we’ve received from contract manufacturers on how we could benefit their businesses:
1. What Is the Role of a Contract Manufacturer in an EOL Last Time Buy Solution?
The moment the contract manufacturer becomes aware that a component is transitioning toward obsolescence, they can notify their OEM customer that a last time buy is necessary. However, instead of leaving the OEM to take care of the last time buy on their own without any aid, the contract manufacturer can refer the OEM to Partstat, who will manage the last time buy process from there by purchasing inventory direct from the component manufacturer before the LTB date.
2. Does the Contract Manufacturer Receive Benefits from Recommending a Last Time Buy Solution?
Yes! By allowing Partstat to take control of the last time buy process, neither the contract manufacturer nor the OEM need be concerned about tying up working capital, as Partstat uses its own working capital to make the purchase direct from the component manufacturer. Additionally, this alleviates friction between the contract manufacturer and the OEM, because it shows that the contract manufacturer is making every effort to provide additional services that no other contract manufacturer would. In other words, it allows contract manufacturers to stand out in a competitive marketplace.
3. How Can I Convince an OEM that an EOL Last Time Buy Solution Is the Best Step Forward?
It is always difficult to recommend a change outside of the long-established process. The best thing a contract manufacturer can do is be informed of the various benefits an OEM receives through our solution — and then communicate those benefits to their OEM customer. Such benefits include improved margins, a reduction in on-hand inventory, the avoidance of component price inflation, and guaranteed support of long-term platforms. Remember, an EOL Last Time Buy Solution secures all LTB inventory direct from the manufacturer before the LTB date, so OEMs and Contract Manufacturers don’t have to! For more information, review Contract Electronics Manufacturers and Original Equipment Manufacturers.
4. Suppose the Contract Manufacturer or OEM Has Already Purchased the Inventory. Can Partstat Still Be Used as a Long-Term Storage Partner to Save on Limited Warehousing Space?
Yes! Partstat offers a full suite of long-term storage options for sensitive electronic inventory, up to and including a full custom storage vault that has been rated “Best in Class” for component and raw material storage. We work with our customers to create a fully personalized long-term storage option that takes into account the needs of their unique situation, whether that includes climate-controlled storage or the need for desiccant dry cabinets typically reserved for die and wafer banking. All of our storage solutions also include custom global fulfillment, whereby we will ship anywhere in the world in accordance to all ESD and MSL Protocols.
5. Can Partstat purchase inventory directly from the CM and move the commitment to their OEM?
Yes, we can! This improves working capital for the CM with immediate payment and also reduces the amount of inventory carried on their books.