AFDEC forecasts 2007 business will be good
01 March 2007
The Association of Franchised Distributors of Electronic Components (AFDEC) (www.afdec.org.uk) is optimistic about the business future of total available market for distribution in this sector will grow by two per cent in the UK this year, to £1.37billion. The TAM (total available market) is, however, expected to decline by 0.2 per cent, to £3.786billion.
According to Adam Fletcher, chairman, AFDEC (pictured), business is transferring from component manufacturers to their franchised distributors.
The influence of large, worldwide distributors, such as DigiKey have effectively sold out of their region, using the internet well to reach a wider audience, backed up with efficient delivery systems. However, Fletcher does not believe that these companies, while having ‘some penetration in design wins’ have not impacted the UK franchised model.
The so-called ‘grey market’ is fraught with disincentives, according to Fletcher. Major CEMs (contract equipment manufacturers) will not buy through these channels because there is a quality risk, even with standard products, like resistors and capacitors, he says.
A new trend, is the selling of reference designs, especially in large companies where multiple lines on a card can be integrated into a design unit. Fletcher believes this is ‘bound to become more commonplace.’
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