Aerospace products tend to fall into three broad categories – general aviation, commercial aviation and military. In recent years, all have seen challenges for manufacturers, suppliers and distributors as they try to match production and inventories with orders and pipelines in an economy lurching toward recovery from the Great Recession and impacted by the U.S. government sequestration. These events showcased the need for buyers and engineers to tightly embrace the fundamentals of sourcing aerospace components.
The first rule of sourcing is to build a secure and long-term relationship with your distribution partners. This sounds obvious, and perhaps self-serving, but it can be difficult in a world of quarterly production goals and ever tightening budgets. When a distributor comes with a short-term strategy to lower prices and “buy” your business, the temptation to show those savings on the balance sheet can be strong. But when turbulence comes to the market, as it always does, the impact of those short-term decisions may weigh heavily.
Inventory overhead is expensive for a distributor and one of the easiest means to reduce price is to keep a thin inventory profile. That’s a strategy that reduces costs for a few part numbers for a short time, but moves the burden of keeping the supply chain filled to the component supplier. If the supplier isn’t producing that particular part at the time it is needed, the lower price doesn’t help much. Having the components necessary to fill orders impacted by changing market conditions can be the difference between your production lines running efficiently and having them idle, waiting for shorted components. Your downtime costs pile up while your customers move their orders to manufacturers who can meet their needs. Those short-term savings can crush a reputation your brand has invested years to build and protect.
Working closely with an established distributor allows the creation of production planning that gets the right components at the right place, at the right time and at a price that offers a lower total cost of ownership when viewed through the entire life of a program. Snapshot economic savings can be a concern, but when you are looking at a production line for multi-million dollar aircraft, on time delivery and lead time planning can be even more critical than having paid a bargain basement price.
Counterfeit components are another concern that can be mitigated by working with an authorized distributor. By ensuring that your distributor deals only with OEM manufacturers you limit the exposure to the grey and black markets that can be a resource for the independent distributor. These components may come from old stock or be remanufactured, remarked or even fabricated from recycled components. Without an ironclad chain of custody, there’s no way to know who may be ultimately responsible if a component fails or is proven to be a counterfeit. That can leave you as the potentially responsible party. The financial penalties can be dire if counterfeits are found in an assembly, or worse, if the faked component finds its way through production, into service and fails in flight.
A 100 percent authorized distributor can help prevent this scenario. You know your components are coming directly from the original manufacturer with rigorous quality control and testing methodologies. Again, a cheaper price at the moment of ordering can provide a warm feeling at the time, but can cause serious heartburn down the line.
In these days of online ordering and 24/7 connectivity, how do you build the necessary relationships to protect your supply chain? Part of it is simple conversation. A face-to-face meeting or a phone conversation can add necessary color to the bill of materials. An experienced distribution partner can offer insights into performance alternatives and cross match components that can offer the types of advantages that are most critical to your project. Need a less expensive part and you are able to sacrifice a little room on the circuit board? Or do you a have power requirement that isn’t addressed by a standard catalog part number? Picking up the phone or setting a meeting with a distributor representative up front can pay dividends in the long run, as they’ll understand your goals and requirements for the component’s performance. The fully authorized distributor also maintains relationships with a variety of component manufacturers and will know the most recent technology advances, or the expertise and abilities of one supplier that another may lack. These types of insights can’t be shown on a web page or an online ordering portal. Sitting down with representatives from a large specialty distributor such as TTI can provide insight into inventory positions that can make long-term production runs possible and future-proof component purchase programs to make sure that spares can be in stock when you’ll need them. This can be a particular issue in military and commercial aviation programs where aircraft lifespans are measured in decades rather than a few years of product sales.
In some cases, especially with aerospace or mil-spec connectors, a value-added distributor like TTI can create custom connectors with unique pinouts for specific applications, as well as designated marking, labeling or packaging to meet your program and application requirements. Program and aircraft specific components are best created by working closely with the connector source to make certain that all parameters for performance, delivery and pricing are understood prior to the design stage.
The best distributor resources are those that are on-board with your program from the beginning of your initial designs through delivery of the last parts installed prior to decommissioning. It’s a relationship that starts with a simple phone call.
An F-35C Lightning II carrier variant Joint Strike Fighter makes its first arrested landing aboard the aircraft carrier USS Nimitz (CVN68) off the coast of San Diego. Photo courtesy Lockheed Martin.
2014 was the 40th anniversary of the F-16 Fighting Falcon. A reminder that sourcing aerospace components requires a consideration of legacy requirements for decades to come. Photo courtesy Lockheed Martin.
Now into its M Series of upgrades, the C5 Super Galaxy is a testament to the need for upgrade path considerations in aerospace component sourcing. Photo courtesy Lockheed Martin
Reprinted with permission from Electronics Sourcing North America.