Market Intelligence
November 22, 2023

9 Steps to Find a Trustworthy Supplier

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When entering the open market, you will meet a lot of different characters along the way. But how can you avoid the negative consequences that could come with acquiring parts from an unvetted supplier?

The steps below will guide you when assessing a supplier so that you are less likely to find yourself in an unfortunate predicament that leads you back to square one in your parts search.

Steps to Find a Trustworthy Supplier

Step 1: Find Out if They’re Global

Having testing facilities around the world offers convenient and efficient support between the customer and distributor. For instance, if there’s a hiccup in the supply chain that affects one location, a supplier with multiple warehouse facilities can re-allocate product or testing to other locations within its network when the need arises. To have a successful global operations strategy, it’s vital that all locations and personnel are working from the same system and processes. This also improves the customer-supplier communication by meeting the customer where they are rather than making them dependent on a source that’s a whole continent away.

Step 2: Confirm They Have the Proper Certifications and Memberships

Quality systems certifications showcase a supplier’s dedication to industry best practices, standards and continuous improvement. Common certifications include:

ISO 9001

ISO 14001

ISO 17025

AS9120

AS6081

ANSI ESD S20.20

CCAP-101 

It is also important that the partner is a member of organizations dedicated to quality initiatives, including the Electronic Resellers Association, Inc. (ERAI) and the Independent Distributors of Electronics Association (IDEA), which display credibility and a well-rounded community of industry professionals.

Step 3: Check for Strong Procurement Controls

A detailed vendor qualification, management and rating process is extremely important. The partner should have a well-built procurement process based on risk. The lowest-risk, most traceable suppliers should be the first source consulted in a parts search because they are more likely to find you exactly the parts you need.

Step 4: Ask About Their Quality Inspection Process

To ensure the authenticity of the parts being purchased, it is vital the components go through a rigorous inspection and testing process. An example is Fusion Worldwide’s 5-phase, 100-point inspection process, which includes documented part verification, quality inspection and lab testing.

Step 5: Assess Their Facilities, Equipment and Capabilities

Investment into equipment, such as a chemical Decap, X-Ray, XRF and high-power scopes, is critical to a strong inspection process. While having the right equipment is important, a strong employee training program that includes thorough demonstrations on the use of equipment, up-to-date preventative maintenance orientation and safety measures should also be stressed.

Step 6: Confirm They Have Security Measures in Place

Data security measures, such as data compartmentalization, multiple layers of authentication protocols and frequent penetration testing should exist as part of a supplier’s security program. Physical security is also vital to protect customer data, like access control, 24-hour monitoring, active video monitoring and high-security vaults for high value components and customer inventory.

Step 7: Ensure the People Behind the Processes Know the Business

It is important that employees are trained on the latest techniques with continued education on industry best practices. Organizations like IDEA offer inspector certification programs, such as IDEA ICE 3000.

Step 8: Set Criteria for Communication and Transparency

There should be well-defined, transparent communication processes and methods to share inspection and test results, updates and other issues. Fusion Worldwide, for example, develops an inspection report to guide the customers through its process.

Step 9: See if They Provide Market Intelligence

It is vital that the partner monitor market events and keep the customer updated on status of their supply chains in relation to it. This will allow the customer to be equipped to take preemptive actions and immediately react. Fusion Worldwide, for instance, produces a monthly market intelligence report containing comprehensive insight into CPUs, ICs, storage, memory, and other finished products, called The Greensheet.

You’ve Found Your Supplier, Now What?

Now that you have selected a supplier, the best way to assess the necessary qualities is by touring the supplier’s facilities and conducting an audit to ensure you always get quality parts. Preparing for the audit by knowing all the tools the supplier should be using in its inspection process will help you avoid getting lost in a maze of unknowns.

Here are some questions to ask during an audit:

    • How do they qualify suppliers and how do they handle complications with suppliers?
    • Do they adapt to specific customer requirements regarding inspection, sampling, testing, labeling and communicating?
    • What equipment do they have and how is it used?
      • Do they have a Keyence Scope or other scope with high magnification, XRF and Decap?
      • How are employees trained on the equipment? How is training conducted and recorded?
      • How is the equipment maintained?
      • Is there a safety program?
    • What capabilities are in-house versus outsourced? If services are outsourced, how do they qualify those sources?
    • What are their inventory control procedures? How do they maintain traceability of items through their process and facility? How do they ensure parts are not mixed?
    • What are their reporting processes?
    • What sampling plans do they use? Is the process detailed?
    • How do inspectors stay up to date on what is happening in the market and what kinds of problems may be out there?
    • What is their certification roadmap? Are they ANSI ESD S20.20 certified?

As today’s climate shows, turning to the open market is an inevitable path you will either fall into or intentionally choose to go down. The choices you make once you go down that path, though, can lead to two vastly different outcomes — one that could leave you with the parts you need and the other leaving you caught in the depths of the rabbit hole scrambling to get out empty-handed. Take the time to properly vet an open market supplier and build a strong relationship that protects you from supply chain shocks.

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