SMT Perspectives and Prospects: Warren Buffett’s Perpetual Wisdom, Part 1
Standard of Excellence: Training Your Team to Excel in Customer Service
Smart Automation: What Industry 4.0 Means for Mid-sized Electronics Manufacturing
Are Firms Holding Too Much Inventory?
October 30, 2024 | Shawn DuBravac, IPCEstimated reading time: 1 minute
In the aftermath of the 2008 financial crisis, manufacturers made significant adjustments to inventory management strategies as they faced sharp declines in demand and economic uncertainty. Manufacturers moved to scale back production and attempted to quickly reduce inventory levels. Post-crisis, many manufacturers adopted lean inventory practices, such as just-in-time (JIT) production, to minimize holding costs and illiquidity risks.
The crisis highlighted the risks of large inventories during periods of volatile demand and price fluctuations, prompting a greater focus on supply chain efficiency. While some sectors recovered quickly, others—particularly those reliant on consumer spending and credit markets, such as automotive and durable goods—experienced a slower rebound. Manufacturers remained cautious about overstocking, and inventory restocking was gradual and deliberate, aligning more closely with demand to create a responsive and flexible supply chain.
The lean inventory strategies adopted post-2008 had significant consequences during the COVID-19 pandemic. The JIT model, which minimizes on-hand inventory, left many manufacturers vulnerable to the widespread disruptions caused by lockdowns, factory shutdowns, and transportation delays. As a result, industries like medical supplies, electronics, and automotive components faced severe shortages. Long global supply chains, especially for critical components, exacerbated the situation. With no buffer stock, many manufacturers were forced to halt production.
In the initial aftermath of the pandemic, demand surged for certain products, such as home electronics and medical devices, while demand plummeted for others, such as automobiles and fashion. This rapid shift created both overstocking and understocking across sectors. Uncertainty amplified demand forecasting errors, leading manufacturers to over-order to avoid shortages and exacerbating manufacturing bottlenecks.
To read the rest of this article in the Fall 2024 issue of IPC Community, click here.
Share on:
Testimonial
"Advertising in PCB007 Magazine has been a great way to showcase our bare board testers to the right audience. The I-Connect007 team makes the process smooth and professional. We’re proud to be featured in such a trusted publication."
Klaus Koziol - atgSuggested Items
Direct Metallization: A Sustainable Shift in PCB Fabrication
07/31/2025 | Jim Watkowski, Harry Yang, and Mark Edwards, MacDermid Alpha Electronic SolutionsThe global electronics industry is undergoing a significant transformation, driven by the need for more resilient supply chains and environmentally sustainable manufacturing practices. Printed circuit boards (PCBs), the backbone of interconnection for electronic devices, are at the center of this shift. Traditionally, PCB fabrication has relied heavily on electroless copper, a process that, while effective, is resource-intensive and environmentally hazardous. In response, many manufacturers are turning to direct metallization technologies as a cleaner, more efficient alternative.
KOKI to Showcase Analytical Services and New HF1200 Solder Paste at SMTA Guadalajara 2025
07/31/2025 | KOKIKOKI, a global leader in advanced soldering materials and process optimization services, will exhibit at the SMTA Guadalajara Expo & Tech Forum, taking place September 17 & 18, 2025 at Expo Guadalajara, Salón Jalisco Halls D & E in Guadalajara, Mexico.
Smart Automation: What Industry 4.0 Means for Mid-sized Electronics Manufacturing
07/24/2025 | Josh Casper -- Column: Smart AutomationIndustry 4.0 has become a go-to phrase in manufacturing circles, though it’s often used as a slogan rather than a clearly defined concept. At electronics manufacturing trade shows or conferences, marketing banners and vendor literature display the term prominently; many technical sessions also focus on it. Industry 4.0 is the push for smart factories, with a focus on autonomous machines, cloud-connected systems, and AI-powered decisions.
Reshoring Expert to Speak at WHMA Global Leadership Summit
07/16/2025 | Nolan Johnson, I-Connect007The 2026 WHMA Annual Global Leadership Summit offers the tools you need to help your business succeed in this industry that constantly evolves with new technology and practices. WHMA's Annual Global Leadership Summit (formerly the WHMA Annual Conference) is a networking event for executives representing wire harness manufacturers, OEMs, and suppliers to companies that build wiring harnesses and cable assemblies.
Confronting the Challenges of an Aging Workforce
07/15/2025 | Becky Calwell and Myriam Sullivan, Jobs for the FutureElectronics manufacturers have faced persistent workforce challenges as they struggle to find skilled workers to meet rising production demands, while rapid advancements in technology raise the bar for technical expertise. These ongoing issues highlight the need for innovative workforce strategies to address talent shortages and adapt to the industry’s evolving demands.