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Optimism grows over mainland China's electronics industry

Posted on: Tuesday, 16 June 2009, 02:15 CDT

HONG KONG, June 16 /PRNewswire-Asia-FirstCall/ -- Eighty-nine percent of mainland China's electronic component distributors expect revenue to grow in 2009, forecasting an average increase of 13 percent; while 55 percent of mainland China electronics manufacturers surveyed said the economic downturn has had little or no impact on their business. The results were revealed in the ninth Annual Electronic Components Distributor Survey conducted by Global Sources' (Nasdaq: GSOL) electronics management title, Electronics Supply & Manufacturing-China (ESM-China, http://www.esmchina.com ).

(Logo: http://www.newscom.com/cgi-bin/prnh/20030303/LNM011LOGO-b )

This year, ESM-China asked 326 senior managers who are working for components distributors and 1,243 senior corporate, purchasing or procurement managers from electronics manufacturing companies operating in mainland China about their current challenges and plans for the future.

Mainland China manufacturers well equipped to cope with change

The Survey revealed that 55 percent of manufacturers want to work with local distributors in the coming months, an increase of 18 percent as compared to last year. However, 32 percent still prefer to work with Hong Kong, Taiwanese and international distributors. Other key results include:

-- Manufacturers order 54 percent of their components directly from distributors. -- Seventy-eight percent of manufacturers plan to either increase their purchases from distributors, or keep them the same, this year. -- They are selecting distributors based on availability of onsite engineering support (48 percent), reference design (45 percent), test service (30 percent) and development tools (28 percent).

Publisher of ESM-China, Mark A. Saunderson said: "As well as providing an insight into the distribution landscape for 2009, the Survey also points to a robust electronics industry where manufacturers are well-equipped to cope with the market challenges and feel positive about making a profit. Distributors can also take away some good pointers on what manufacturers are looking for, now and in the future."

Distributors are changing their tactics to grow business

Mainland China distributors are also shifting their strategy to grow their business. An increasing number of them are now focusing on serving medium- and small-scale manufacturers rather than larger-scale outfits.

They are also looking at delivering more solutions to emerging, high- profit application markets including:

-- control, security, test and medical equipment; -- computer and peripherals; and -- automotive, avionics and military electronics.

Distributors have also implemented a number of steps to ensure the quality of their components in reaction to the demands from both the mainland China and global consumer market. These include strict supplier approval; employee training; third-party testing; purchase testing equipment and ISO certification.

Mainland China manufacturers vote for their most preferred distributors

As part of the Survey, mainland China manufacturers were asked to vote for their most preferred distributors in five different categories. Winners of each category are (in alphabetical order):

-- Most Preferred Overseas Franchised Distributors: AECO Technology, Arrow Electronics, Avnet, Cytech Technology, Excelpoint Technology, Future Electronics, Nu Horizons Electronics, Richardson Electronics, WPG Holdings and Yosun Industrial Group. -- Most Preferred Local Franchised Distributors: Asiacom Technology, Baite Electronic, China Electronic Appliance Shenzhen, Comtech Communication Technology, Honestar Technologies, Linpo, LSD Science & Technology, Road-Well, Secom Telecom and Seed Electronic Technology. -- Most Preferred Independent Distributors: America II, Chitron Electronics, Compo Electronics, EVERY, Interine Electronics, Mission Electronics, Mogultech International, Pioneer Electronics, Smith & Associates and Times Brilliant Electronic. -- Most Preferred Small-to-Medium Sized Distributor: Ampro Microelectronics, Burnon International, E-Shine Digital Technology, Incel Components, Jcmicon Enterprises, KuanHeng Industrial, G&T Industrial, Mornsun Electronics, Pace Electronics and Shenzhen Cestar. -- Most Preferred Catalog Distributors: Mouser Electronics, P&S Information Technology, Premier Electronics and RS Components.

For more information on the ninth Annual Electronic Components Distributor Survey, please contact Major Lee, Chief Analyst of ESM-China, at majorlee@esmchina.com .

About Global Sources

Global Sources is a leading business-to-business media company and a primary facilitator of trade with Greater China. The core business uses English-language media to facilitate trade from Greater China to the world. The other business segment utilizes Chinese-language media to enable companies to sell to, and within Greater China.

The company provides sourcing information to volume buyers and integrated marketing services to suppliers. It helps a community of over 803,000 active buyers source more profitably from complex overseas supply markets. With the goal of providing the most effective ways possible to advertise, market and sell, Global Sources enables suppliers to sell to hard-to-reach buyers in over 240 countries.

The company offers the most extensive range of media and export marketing services in the industries it serves. It delivers information on 4.3 million products and more than 196,000 suppliers annually through 14 online marketplaces, 13 monthly magazines, over 100 sourcing research reports and 12 specialized trade shows which run 29 times a year across 10 cities.

Suppliers receive more than 67 million sales leads annually from buyers through Global Sources Online ( http://www.globalsources.com ) alone.

Global Sources has been facilitating global trade for 38 years. Global Sources' network covers more than 69 cities worldwide. In mainland China, Global Sources has over 2,500 team members in more than 44 locations, and a community of over 1 million registered online users and magazine readers for Chinese-language media.

About eMedia Asia Ltd

eMedia Asia Ltd. is a joint venture between Global Sources and TechInsights, a division of United Business Media, supplying media, professional and marketing services to decision makers in the electronics industry. The joint venture is a leading provider of new technology content, in print and online for thousands of technology specialists that drive the electronics industry in China and Asia. eMedia Asia Ltd. serves this community's ongoing need for the right information, at the right time through its integrated, local-language web networks, premier technical events and industry leading publications -- EE Times-Asia, Electronic Design-China and Electronics Supply & Manufacturing-China.

Global Sources Press Contact in Asia: Camellia So Tel: +852-2555-5021 Email: cso@globalsources.com Global Sources Press Contact in U.S.: James W.W. Strachan Tel: +1-480-664-8309 Email: strachan@globalsources.com Global Sources Investor Contact in Asia: Investor Relations Department Tel: +852-2555-4777 Email: investor@globalsources.com Global Sources Investor Contact in U.S.: Kirsten Chapman & Timothy Dien Lippert/Heilshorn & Associates, Inc. Tel: +1-415-433-3777 Email: tdien@lhai.com

SOURCE Global Sources

Source: PR Newswire

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