Catalog distributors have found success focusing on new product introductions and small production runs.
By James Carbone -- Purchasing, 5/8/2008
Many electronics distributors are concerned what impact the economic slowdown will have on their businesses in 2008. However, while catalog distributors may not be completely recession-proof, they are less affected by the cyclical ups and downs of the economy.
“When you cater to design engineers, that business doesn't stop even though manufacturing slows down,” says Kevin Hess, marketing director for Mouser Electronics in Mansfield, Texas. “People are still designing new products with the latest technology. We provide them with the latest products that our component manufacturers have to offer.”
Catalog distributors such as Digi-Key, Allied, Newark and Mouser, sell small volumes of parts for design, prototype builds and small production runs. Margins of the parts are higher than components sold by distributors that supply parts for production. In some cases, OEMs will turn to catalog distributors for items that may be in short supply.
Catalog distributors often have double-digit growth even when the rest of the distribution industry is limited to single-digit revenue increases.
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