The Impact of Supply Chain Issues on Hardware Availability

The Impact of Supply Chain Issues on Hardware Availability

Hardware brokers provide invaluable assistance for companies seeking to replace or upgrade their technology. With extensive industry knowledge and vast supplier networks at their fingertips, hardware brokers are adept at finding rare components for customers.

Global supply chain issues have affected everyone from manufacturers of aluminum cans and car tires to those producing high-tech equipment. Keep reading to discover how these challenges are impacting hardware availability.

1. Under-production of Crucial Components

Chips have expanded beyond computers and phones in recent years to become essential components in automobiles, medical devices and smart gadgets – creating an overreliance on global supply chains for processing power resulting in shortages that threaten serious disruptions to daily life.

IT industry vendors are grappling with an unprecedented surge in server, storage and networking hardware purchases due to increased lead times and costs for many key components.

With this in mind, businesses must reevaluate their approach to hardware procurement and management. Instead of focusing on large efficiency improvements, businesses should prioritize building partnerships with manufacturers and suppliers early in the R&D process, so as to take advantage of contingencies should production or shipping delays arise – such as having backup suppliers ready when their primary supplier experiences difficulties or working with hardware brokers on hard-to-find components when needed.

2. Labor Shortages

Although many hardware and technology companies have moved away from “just-in-time” manufacturing processes that rely on forecasting demand to guarantee supplies arrive when necessary, it’s still not impossible to have too little or too much inventory due to labor shortages impacting supply chains worldwide.

Baby boomers are retiring and the pandemic exacerbated those trends, leaving not enough younger workers to take their places. Due to labor and transportation challenges, manufacturers have adjusted their purchasing strategies by keeping larger amounts of equipment available just in case it’s needed in an emergency.

Increased inventories have resulted in lead times that can extend for weeks or even months, impacting businesses looking to upgrade storage or networking hardware. Hardware brokers can assist in managing shortages by providing alternative options that minimize their impact on operations.

3. Trade War

The trade war may have lessened America’s reliance on Chinese manufacturing, yet has hastened global supply chains’ unraveling. Companies have begun moving some final assembly steps from China to Vietnam or South Korea so as to bypass Beijing’s ever-rising tariffs and save themselves the hassle.

These locations also serve as manufacturing hubs for Chinese hardware-making firms like TSMC and Foxconn, leaving these firms exposed to bureaucratic retaliation from both sides.

Trade wars also cause transportation bottlenecks. Asian ports struggle to meet customer demand for shipping containers while logistics operators struggle with transporting the containers from port to warehouse, leading to shortages for hardware that customers require for their businesses – from servers and storage systems, all the way through to server virtualization software and beyond. It could take weeks or even months before all customers can receive what they require – potentially impacting customer businesses negatively and leading to lead time increases from weeks to months.

4. Weather

Geopolitical uncertainty and labor shortages may keep supply chain procurement teams awake at night, but extreme weather events also play a vital role. Heavy snowfall, floods in China disrupting production of peanuts, pigs and coal as well as tropical storms’ power outages can have major ramifications on electronics supply chains.

Extreme temperatures can damage computer hardware by overheating it or cause electrical connections to arc and lead to surges and outages, worsened by weather events rather than human error or structural failures.

Companies seeking to mitigate weather-related disruptions should take steps to identify high-risk sites and create mitigation plans, including taking an in-depth look at where their suppliers operate – for instance, near coastal regions susceptible to flooding? Or in areas vulnerable to tropical storms or earthquakes?

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