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Why electronic component suppliers need to think about the BOM

ecommerceI’ve been wondering lately if electronic distributors’ investments in e-commerce are paying off.

I’m just speculating here (I can’t say with 100% authority that distributors are not seeing a return on the investment) but there are definitely clues that the market at large is not adopting e-commerce for electronic part shopping.

Take the case of one of the leaders in component distribution. This company has clearly invested a lot in e-commerce, and has one of the best e-commerce sites in the industry. But when you visit the About Page for this particular distributor, you see that while it processes 3.4 million orders a year, it also logs 2 million calls and receives 320,000 faxes. So despite a significant investment in e-commerce and a great website, I feel it’s safe to assume that the majority of business is still done the old fashioned way.

And I’m not surprised. The idea of e-commerce is to simplify shopping and let buyers buy on their own time table. But with multiple competing distributors in the space and no way to mass purchase for a bill of materials (BOM) across distributors, manufacturers still have to buy their bill of materials (BOM) part by part. At that point, e-commerce isn’t even worth it—might as well send over your standard order via email or call it in.

For consumers, purchasing components for a BOM online is still a pain

Just one 100 “board in a box” PCBA can have 200 different parts—imagine if you had to shop for several of these boards to complete your product. The process would go something like this.

Run a search for a dual voltage regulator such as LM125, find your regulator, click into the details page, add part quantity, add to cart.

Search for resistors, find your resistor, view the details page, add quantity, add to cart.

(Repeat process 198 more times on a variety of distributors’ websites.)

And the problem gets worse if you are trying to optimize for cost and/or deliver the parts into a specific production/prototype window.

All that work, and at the end of the process, someone would still have to go back into the BOM and update the documentation manually.

There’s got to be a better way . . .  and please don’t say EDI.

Until there is a way around this fragmented approach to part shopping, using e-commerce methods just doesn’t seem practical. If you need to quickly buy 10 parts, e-commerce is a nice time saver (and you don’t have to talk to a person—which is sometimes appreciated when you’re in “design mode.”). But doing any more than that is a pain, and so the more archaic methods—email, fax, and phone—make a lot more sense.

How do we connect the BOM to electronic component shopping?

At the end of the day, parts roll up into BOMs. So when electronic distributor sites can’t talk to your BOM, or allow you to build, buy, and manage a BOM in the same place, e-commerce is a poor solution for buyers.

There is enormous complexity in the purchasing process because it’s not just about cost—availability, pricing deals, company policies about who to buy parts from, etc. all play a role. When all this information is fragmented and separate from the BOM, it becomes really difficult to manage. The day a buyer can go online and see the order status of their entire BOM in one place . . . now that would be a huge win.

Arena Supplier Item Lookup for Octopart and SiliconExpert makes it is to integrate your BOM to compliance and material availability information within Arena PLM and QMS.