8 MAY / JUNE 2022 Wiring Harness News INDUSTRIAL INFO-TAINMENT
By Loren Smith ___________________________
Now into our third year of the pandemic , we would think the harness component supply chain challenge would have been resolved . Not so . Severe parts shortages continue to cause constant schedule disruptions for harness makers , resulting in daily expediting and non-stop shuffling of customer schedules to avoid putting customer production lines down .
Exacerbating the nightmare , component suppliers are raising prices –– with no notice or justification .
Supply Chain Nightmare
So , we could lick our wounds and console ourselves with the knowledge that supply chain issues have been creating chaos in countless industries , but our industry often confronts an additional hurdle : When harness customers dictate component sources for harness makers , the leverage that normally exists in customer / supplier relationships dissolves because many component suppliers do not treat harness makers with the respect normally found in customer / supplier relationships .
I learned this years ago as a new entrant into the wire harness community . When a salesperson from
We Get It Done
Packard Electric ( now Delphi Packard Electric Systems ) first called on me , he read me his company ’ s rulebook . In detail . I was flabbergasted at the “ power imbalance .” And here I thought I was the customer .
Over the years that I owned and ran a harness company , my depth of experience did not make much of a dent in this lack of leverage . I still bear a scar from the disaster when my customer , a sizable construction equipment manufacturer , specified a major connector supplier that then failed to deliver product . But this deeply flawed business model might be about to change .
Like many changes the pandemic has accelerated , wire harness manufacturers are now often provided sourcing authority for the components that go into the wire harnesses they produce . As this stride grows , it will gradually eliminate the frustration of having to tolerate a supplier with chronic delivery issues and unsupported price increases .
Loren Smith CEO Blue Valley Capital
This shift is not widespread yet , and the supply chain nightmare is still suffering the consequences of the pandemic , but brighter days appear to be on the horizon . Meanwhile , know that you have many peers who feel your pain .
Loren Smith can be reached at lms @ blvcapital . com or www . bluevalleycapital . com .
Recent transactions arranged by Blue Valley Capital ______________________________________
BHC Cable Assemblies , Inc . Hamilton , Ontario , Canada
Sold to Electronic Components International St . Louis , Missouri ______________________________________
Shine Wire Products , Inc . Adams , Massachusetts Sold to ComSonics , Inc . Harrisonburg , Virginia ______________________________________
www . bluevalleycapital . com
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