A Well-Designed Laminate Supply Chain has to Own It!

Designing a supply chain for the provision of laminates and pre-pregs to the PCB fabricator shouldn't be that complicated, should it? The laminate is simply manufactured and then shipped... what could possibly go wrong? It turns out it is more complicated, partly because the supply chain is not fully owned by one supplier, and hence cannot be fully customized to the needs of each customer.

There are a number of things that make that supply chain complex beyond the fact that there are multiple parties involved, from the laminator to the distributor or sales agent to the logistics provider. Forecasting, as we all know, is not an exact science, especially in Western Europe and North America, where lower volumes, high mix and quick-turn are the demand drivers. 

The PCB industry is so unpredictable in its demand that most fabricators won't offer their laminate supplier a forecast at all. This may not be a problem for the regularly used, standard materials that are most likely available locally and at short notice, or are perhaps even part of a consignment stock agreement. But what about those unusual requests, which seem to always be accompanied by a request for fast turnaround? These might not be available in your geography, and that delay in receiving material can be the difference between winning or losing an order, or even retaining or losing a customer.

Increasingly, the supply chain seems to want to shift any commercial risk involved in stocking goods onto the customer who isn't refusing to forecast because they don't want to, but simply because they can't. So demand is unpredictable, but there's more to it than that. What about customization of materials, such as unbalanced copper or an unusual build structure? This is out of the question for typical laminate supply chains with third-party distribution, where the local vendor has to share your needs with his supplier or suppliers and find a solution that then has to be produced and shipped. All of that takes time - too much time.

On top of these challenges one must consider compliance and traceability. A fragmented supply chain will probably lack the traceability and security you want, and even the traceability you need for the various bodies you are audited by. You are responsible for your supply chain, so any lack of traceability or even visibility leaves you open to non-compliance, and worse. Not all laminates are created equal, and if you don't know where they are coming from you may open yourself and your customers up to reliability issues in the future, which can be at best expensive and at worst fatal. This can be further exasperated when vendors provide laminate from multiple sources.

What starts as a simple request to one part of the supply chain, can end up quite confused at the far end of the supply chain when relayed through a number of parties. Like the example given by a general in the trenches, who said, "Send reinforcements, we're going to advance," and the message that reached his command back at base was "Send three and four pence, we're going to a dance."

There Must be a Better Way!

Of course there is, but it's not as simple as auditing lots of vendors and seeing what they have to offer and what solutions they can provide to unpredictable demand, risk mitigation, customization and traceability. The only real solution is to work with a vendor that owns the supply chain, providing you with the ability to customize that supply chain to meet all of your commercial, technology and service needs. Many regional agents understand their market well enough to develop a one-size-fits-all solution to cover most of the aspects of local demand, but very few can answer all of these questions. 

What's more, very few distributors, possibly none, have their own laboratory in region, something that we think is critical. I don't buy off-the-peg suits, so why would I use an off-the-peg supply chain and put up with the compromises that go with that? Not having the right laminate at the right time is much worse than a jacket that won't button up properly after a big lunch!

What it Means to "Own" the Supply Chain

An exceptional supplier will "own" the supply chain - every part of it from the laminate

and pre-preg production to the final interface with the PCB fabricator. Because of that, they can design and customize that supply chain to suit any demand mix. This could mean supplying direct containers from China for constant price sensitive demand, all fully logistically supported. It might mean quick-turn from regional inventories to manage peak and variable loads, or even consigned stock to provide immediate availability. It might even mean regional panel format pressing, all cut and marked for complete traceability.

This approach, together with an extensive product range creates the optimum mix of quality, service, technology and cost, in a demanding market, whilst maximizing availability of the materials required, fulfils fabricators and the end customers' demands. Forecasting is often just an educated guess. But with some science to that art and by considering past consumption, it is possible to predict some key elements of future demand. It will not provide a complete picture, but with this, and a combination of regional stock, quick-turn manufacturing capability and market intelligence, an exceptional supplier should be able to achieve the required delivery more than 99% of the time (OTIF, on time in full).

Now, if that same company owns the material, wherever it is in the world, in a laminate press in Suzhou, on a boat in the Pacific Ocean, or in other local facility throughout the world it means that no matter where the vendor is in the world, the person that you are talking to has access to the full global inventory.

Suppliers must use industry knowledge, robust systems, clever software and total visibility to build a supply chain agile enough for any PCB fabricator. Consigned stock, local customization, regional hubs, short manufacturing cycles, controlled processes and highly evolved systems are just a few of the tools needed to develop custom fit solutions that flex and move with the needs of the fabricator and their customers. You can only design the supply chain when you own the supply chain.