Open Market Sourcing Begins and Ends with Quality

As companies work to keep production moving in the midst of shortages, more industries  are approaching the open market to source their electronic components. This  route has become a necessary part of any resilient supply chain strategy. The  global chip shortage, however, has led to increased counterfeiting activity  and an influx of fake chips in the market.

When the supply is not adequate to the demand, it is a golden opportunity  for bad actors to profit from customers' plight. While there is a degree of  risk in the open market, there are ways to confidently leverage this sourcing  channel to secure your supply chain and prevent line-down situations.

Reputable independent distributors make substantial investments in their  quality management programs to protect customers from counterfeit components.  Industries like aerospace and defense, medical, and automotive require elevated  levels of testing and inspection to ensure authentic parts, and reliable sources  offer these enhanced services. Through advanced testing equipment, inspector  expertise, and ongoing education, independent distributors are the first line  of defense against preventing substandard parts from entering the supply chain  despite the growing threat.

Increasingly sophisticated counterfeits are evading detection at a rapid  pace in the electronic components industry. According to ERAI, there was a  ten percent increase in counterfeit reports from 2020 to 2021. However, it  is also important to note that counterfeit reporting is voluntary, so these  numbers may not paint the full picture of the challenge. Despite being optional,  it is critical to report counterfeits to put an end to this ongoing dilemma.  While counterfeits are a genuine threat in the open market, legitimate independent  distributors are committed to their quality control processes to eliminate  risk and promote a positive outcome for all involved.

When approaching the open market or assessing independent distributors,  remember the importance of quality to your supply chain. Without a certified  provider, you’re at risk of significant consequences including decreased product  reliability, malfunction, premature failure, injury, product recall, reputation  damage, and monetary loss. Because of this, evaluating independent distributors  requires thoughtful consideration of your business’s needs. Gain confidence  in the source of the parts by preparing a list of requirements to evaluate  independent distributors, guaranteeing they satisfy your needs. When looking  to enter the open market, the following considerations are vital. As a connected  distributor, DRAGON prioritizes each of the pillars below.

Supplier management: Ensure your distributor sources from approved, verified  suppliers. At DRAGON, we conduct thorough research and pre-qualify suppliers  to confirm all products are procured from reputable sources.

Inspection and testing: The components you need should meet your requirements  in a timely manner. We maintain industry quality certifications and our team  members hold top credentials in their field and participate in ongoing training  and development. DRAGON thoroughly inspects each product and its packaging to  confirm authenticity. Thorough testing is well worth the investment and time  it takes to prevent a costly mistake.

Certified component quality engineers: Highly trained and experienced quality  inspectors should perform testing services. DRAGON is one of the few independent  distributors to employ component quality engineers specialized in counterfeit  awareness, detection, inspection, and customer-specific processes.

Value-added services: Look for a reputable independent distributor who can  provide customized services. Our testing services span from custom counterfeit  detection to solderability testing, DC/AC functionality, and more.

As the only public open market distributor, DRAGON is equipped with an advanced  quality management program. Our quality program establishes checks and measures  to protect customers against substandard and suspect parts, ensuring reliable  procurement and authentic components that our customers can trust to meet their  production schedule.

Open market sources can create greater visibility in the supply chain, resulting  in a more resilient supply chain. By prioritizing quality in each step of the  sourcing process, partnering with independent distributors can help you mitigate  risks and achieve your unique business goals. Additionally, remaining vigilant  and taking the necessary precautions helps reduce the prevalence of counterfeits  and improve the security of the market. Work with a trusted partner, like DRAGON,  to solve the future.