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The Purchasing Process of EEE Parts – Key Factors for Success

  • Posted by Paloma Serrano
  • On June 1, 2020
  • 0

The correct assessment and quotation phases followed by the correct part choice and purchase order placement are crucial steps for the successful procurement of EEE parts. However, the next phase of the procurement, the follow-up phase, is just as important to meet the technical requirements and timely delivery that will result in a successful purchase of the wanted parts.

End-user statement preparation and license application.

  • Some EEE parts may be subjected to export controls depending on their nature and classification. In such cases, the corresponding End-user statement must be provided duly completed to the manufacturer to be submitted for approval with Export compliance. Even though many applications will not result in a license once evaluated (, which means parts can ship without a license), this process can be very time-consuming, and the corresponding lead time should be considered.

Thorough check of the Purchase Order Acknowledgement issued by the Manufacturer.

  • It is necessary to perform a detailed check of the PO acknowledgements since the first issues can arise as early as at this stage. The exact part type, C/N, quantities and technical features and specifications, as well as the lead time and price, must be verified and found in agreement with those on the purchase order. Despite the likelihood of finding disagreements at this point is not very high, the detection of simply a typo could prevent future incidences and non-compliance problems.

Close follow-up on the production and delivery date.

  • The duration of this phase ranges from a few weeks, in the case of stock deliveries, to over a year for components with a complex manufacturing process. A special emphasis must be placed on the accomplishment of the production plan to ensure that all the steps are successfully completed according to the chronogram and the delivery date is met accordingly. This follow-up phase may include the subsequent follow-up on the testing activities at the manufacturer, their successful completion and report delivery.

Fast resolution of incidences that might arise during production.

  • In some occasions, parts fail a certain test fails during the manufacturing process. In fact, this is the most common cause of delays in parts delivery. Despite the manufacturer is the responsible entity to fix the problem, proactive management, which includes searching for stocks and looking into alternative solutions, is key to a successful procurement process.

Scheduling and preparation of pre-cap and buy-off inspections.

  • These steps are part of the follow-up phase and have the singularity that they may be performed by external inspectors and even in the presence of the customer. This requires special coordination between the manufacturer and the agent performing the inspection, considering the (sometimes very limited) time slots available for inspection at the manufacturer and the availability of the inspectors.

Quality and documentation incidences once parts are delivered.

  • Even if the previous preventive steps have been carefully followed, it is possible that parts could arrive with non-conformances, either on the parts or in the related documentation.

For instance, considering the Operational Amplifiers purchased by ALTER over the last decade, we have found that most of the deliveries take place between 20 and 40 days after the PO placement, as shown in fig.1. Manufacturers (without focusing on any specific one) quote an average delivery time of 34 days, and the actual average delivery time is 35 days.

Delivery time

Fig.1 Delivery time (days) of operational amplifiers since the purchase order placement.

Additionally, when it comes to the achievement of the delivery dates (in other words, meeting the date promised on the quotation) of the operational amplifiers, a 74% of the orders have arrived on time (and even before the promised date) at ALTER, and only a small percentage has experienced some delay (see fig.2).

percentage of accomplished

Fig.2. Percentage of accomplished delivery dates of Operational Amplifiers procured by ALTER over the last decade.

This high success rate on the delivery is due to a great extent to ALTER’s broad expertise in the field of EEE-parts procurement.

If you have further questions on the optimized procurement system at ALTER, or interest in how our services can adapt to your company’s needs, please contact us.

Paloma Serrano
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