Chris McAneny, MD of Arrow UK, believes that a distributor's ability to deliver technical support on ever more complex products is increasing in importance, and that access to that support cannot depend on whether the client's engineers are “in Motherwell, Moscow or Minnesota”.
In the US, his company is already looking to increase its technical support activities by partnering with design houses (see box).
Distributors large and small are also looking for greater proximity to the production and design processes, as the tendency for a device to be designed in one country and made in another has an impact on the supply chain. Current solutions are seen answering only parts of the problems that arise.
One way in which distributors can get a return on their investment in field application engineers (FAEs) is to use design registration schemes – enabling the distributor which helps with the design-in process to be rewarded, regardless of where the equipment is eventually manufactured.
But McAneny says this system always creates a heated debate and is only useful for components that are not interchangeable with those from alternative suppliers.
Design registration systems exist because suppliers recognise that, despite the growing use of the Internet, they cannot effectively serve most of their customer base for increasingly complex products. Consequently, suppliers depend on their distributors to serve the mass market.
“To do this, the distributor must invest in FAEs to bring customers' designs to market with the best technical solution, taking into account price, performance and time-to-market,” said McAneny.
One downside, he says, is that some customers may not want to be 'directed' as to where to purchase their proprietary products: “In saying this, most customers recognise the value provided by distributor FAEs to their designs. They therefore see it as reasonable that the distributor which has made the investment should expect to service the order.”
Distributors have responsibility to ensure that they invest wisely by carefully selecting the technology and the supplier, says McAneny, and they must manage how the resource is deployed in the customer base.
Design registration is just one of the challenges facing the customer-supplier-distributor equilibrium: “If we add global production shifts, contract equipment manufacturers and indirect revenues then the challenge increases almost exponentially.”
Arrow by design
The US side of Arrow Electronics is continuing to develop a series of close relationships with north American design houses.In the past month alone, the distributor has added three more agreements for its recently launched Arrow Consulting Engineering Services (Aces) arm.
The latest is with LS Research, a specialist design house for wireless and RF-based products. The other two are with Amirix, which concentrates on embedded systems, and Stellcom, which also develops embedded products for markets such as PDA, telematics, wireless Bluetooth and 802.11 and medical devices.
Tom Swist, Aces regional manager in the US, said: “One of the main objectives of the programme is to provide our customers with access to experts when they have a design outside their core competency.”
The move is putting Arrow in competition with contract manufacturers.