KN51015 KEY NOTE ELECTRONIC COMPONENT DISTRIBUTION SEPTEMBER 1995

ISBN 1-85765-474-9

GO TO LATEST EDITION

Table of Contents

Executive Summary

Back to Electronics and Consumer Electronics Index

Back to Logistics and Distribution Index

TABLE OF CONTENTS

Executive Summary

Market Definition

DEFINITION

MARKET POSITION

MARKET SECTORS

MARKET TRENDS

Table 1: Output Index Numbers (1985=100), 1988-1992

Market Size

THE TOTAL MARKET

FOREIGN TRADE

Figure 1: The UK Components Market (£bn), 1988-1994

Table 2: The UK Components Market and Distributor Share (£bn), 1988-1994

Table 3: Major Constituents: Forecast Component Supply (£m), 1995

Table 4: The Total Available Market at OEM Prices (£bn), 1992 and 1995

Table 5: Imports and Exports of Electronic Integrated Circuits and Microassemblies: Non-EU Countries (£m), 1993

Table 6: Reported Arrivals/Departures of Electronic Integrated Circuits and Microassemblies Including Digital Monolithic Integrated Circuits: EU Countries(£m), 1993

Industry Background

HISTORICAL BACKGROUND

ORIGINAL EQUIPMENT MANUFACTURERS (OEMs)

STOCK

INTEGRATED CIRCUITS

DISTRIBUTOR CATEGORIES

FRANCHISING

INDEPENDENT DISTRIBUTION

TRADE ASSOCIATIONS

Table 7: Number of Franchised and Non-Franchised Distributors Offering Products to Selected Manufacturers, 1995

Competitor Analysis

THE MARKETPLACE

LEADING DISTRIBUTORS

LEADING CATALOGUE DISTRIBUTORS

OTHER LEADING DISTRIBUTORS

FOREIGN PRESENCE IN THE UK

Table 8: Comparison of Prices from Catalogues: Prices of Low Power Bipolar Transistors (pence), 1995

Strengths, Weaknesses, Opportunities and Threats (SWOT)

STRENGTHS

WEAKNESSES

OPPORTUNITIES

THREATS

Buying Behaviour

CUSTOMER BUYING BEHAVIOUR

Outside Suppliers to the Industry

RAW MATERIALS SUPPLIERS

MANUFACTURERS

Current Issues

RESTRUCTURING

THE 'HONEYPOT' ISSUE

SEMICONDUCTOR PRICES

'CASH MOUNTAINS'

Table 9: Recent Returns on Capital for Selected Leading Distributors ( percent), 1993/1994

Forecasts

FUTURE PROSPECTS

NEW APPLICATIONS

THE GROWING MARKET FOR ELECTRONIC COMPONENTS

FORECASTS

Table 10: Market Segments and Growth: Franchised Components ( percent), 1994

Table 11: The Forecast UK Component Market and Distributor Share (£bn), 1995 and 1996

Company Profiles

INTRODUCTION

DEFINITIONS

FURTHER INFORMATION

Further Sources

ASSOCIATIONS

PERIODICALS

DIRECTORIES

GENERAL SOURCES

ICC INFORMATION SOURCES

GOVERNMENT PUBLICATIONS

OTHER SOURCES

Back to Top

EXECUTIVE SUMMARY

Electronic component distributors bridge many manufacturing sectors, including the component manufacturing sector. Electronic technology has become pervasive, ranging far beyond traditional players such as manufacturers of television sets. There is a great proliferation of products, principally, but not solely, silicon chips, and a host of applications. Generally, the distributor working in the marketplace acts within the formal rules of franchise awarded by the component manufacturer. Examples can be found of distributors which hold many franchises. A large component manufacturer usually awards a number of franchises, some of which may be specialised, e.g. covering only part of a product range. A current trend is for some manufacturers to seek to shorten franchise lists. The distinction is often drawn between catalogue and franchised distributors, although one large catalogue distributor, Farnell Components Ltd, is also franchised.

The biggest catalogue distributor, RS Components Ltd, which is part of Electrocomponents PLC, lists many thousands of products in stock, all for

next-day delivery. Farnell Components Ltd provides the same service, although the list of products is shorter. RS now has products ranging far beyond the electronic, and has business interests beyond the UK. Much of the service is aimed at users such as people involved in repairwork, whose requirements are often urgent, yet incapable of being prescheduled. Equipment manufacturers can preschedule their main requirements, although, the largest of these users are retained as direct account customers of component manufacturers, by-passing the distributors. In a sense, therefore, distributor share of total component supply, is around 30 percent, but nearly 100 percent of the total user population buy from distributors.

Equipment manufacturers buying advanced microchips often face technical problems in the initial applications. Franchised distributors set out to help them to deal with these problems, in some cases also offering help in a variety of other ways, such as warehouse management.

The two major catalogue distributors, and many of the franchised distributors, are extremely profitable. The prospects for strong growth up to 1997 are good. There has been structural change, with two major US distributor companies making acquisitions in the early 1990s in the UK. Farnell has made important acquisitions and relinquished its manufacturing interests. In July 1995, Electron House entered into a wider European venture, and changed its name to Eurodis Electron.

In 1995, Key Note estimates that the UK distributor market is worth around £1.8bn and the growth trend over the next decade should be at least 12 percent per annum. Ripples of structural change will recur, but the key players at the top of the distributor industry are unlikely to show much change.

Text © 1995 Key Note

Back to Top

Back To REPORTFINDER HOME PAGE

Ariadne - working together with our customers to enhance productivity and increase knowledge

© 1999 www.the-list.co.uk Ariadne

Last updated by Duncan Nottage 5th March 1999