Cytech Systems participated in Electronica China 2023, explaining the two major rules for distributors to go through the current cycle of the semiconductor industry
July 14, 2023 Shenzhen, China- Cytech Systems participated in Electronica China 2023 in booth 6.2F221 at National Exhibition and Convention Center（Shanghai）from July 11-13.
As an industry-leading independent distributor of electronic components, Cytech Systems, together with 1,650 exhibitors, exchanged a view on the industry cycle and market conjuncture on this stage of more than 100,000 square meters, and jointly contributed to the recovery of the industry.
Cytech Systems unveiled at the exhibition
Since 2022, the semiconductor industry has entered a downward cycle, and the local component distribution industry has also entered a downturn after experiencing the grand occasion in 2021. The previous hot scene no longer exists. Ted Wang, sales director of Cytech Systems, believes that "the current round of market downturn is mainly related to the weakening demand of end customers. There is a large divergence in the prosperity of the component distribution market in terms of the market of end customers, and the entire industry has returned to rational development. The ways to handle this complex and ever-changing situation reveal the ability of a distributor."
How to go through the cycle in the era of great changes? Find the right direction and cultivate internal strength.
As an independent distributor, Cytech Systems has a very clear positioning of itself. By providing one-stop services from procurement, and inventory management to logistics, it plays a role in regulating redundancy and even lubricating the entire supply chain, helping customers and suppliers improve efficiency, save costs, and achieve a win-win situation in the process, thereby creating greater value.
The continuous global shortage of chips in the past two years has led to problems such as inventory shortages and supply imbalances. Many end customers have begun to realize that the model of the long-term futures has strong uncertainties, and the agility of independent distributors in the industry's cyclical fluctuations and special scenarios makes them stand out. Cytech Systems has grown rapidly at this stage and has accumulated a lot of experience and hard power in cooperation with global top EMS and OEM customers.
Although the current continuous shortage situation has alleviated, many EMS and OEM customers have increased the proportion of independent distributors in their supplier system. With long-term accumulation, and always taking quality as its core, Cytech Systems has gradually penetrated the supply chain of many top customers through flexible, customized supply chain solutions and personalized services for both stock and lead time, and has been rated as an "A-supplier" by several global industrial-grade or high-precision manufacturing OEM customers over the past two years.
Ted Wang（Liangxing Wang）, sales director of Cytech Systems
Faced with the current market downturn and the general fall in the sales performance of local distributors, Cytech Systems also has its coping strategies. First, Ted Wang believes that in response to weak demand, it should be treated differently. For example, the improvement of the distribution market in consumer electronics, communications, and other markets depends on the recovery of the economy and terminal consumer market. However, the market demand for electric vehicles, industrial control, and AI servers is strong, this will be a new opportunity for the electronic components distribution industry and become the focus of current distributors' business efforts.
Second, distributors must firmly improve their strength amidst uncertainty. Take Cytech Systems as an example, “PPV+shortage” is a better solution to adapt to current complex markets and cyclical fluctuations compared to the previous single PPV service mode. Furthermore, we will continue to consolidate our own "new infrastructure construction" and continuously accelerate digital transformation, such as building a LIMS+WMS system, upgrading intelligent warehousing and IT platform systems, and making further progress in its own advantages-certification and quality management systems. Just like the recent successful acquisition of ISO 9001:2015 & AS9120B quality system certification and ESD S20.20 certification, it provides a solid guarantee for Cytech Systems to further serve customers in high-end and sophisticated fields.
Cytech Systems has also adjusted its strategy to global expansion, focusing on both domestic and overseas markets. On the one hand, Cytech Systems plans to set up offices in many countries or regions around the world to provide comprehensive services and support closer to local customers, which further enhances the connection between us and overseas markets. On the other hand, Cytech Systems will actively seek agents of domestic semiconductor manufacturers, and regard it as a breakthrough to vigorously expand domestic brand channels and distribution channels.
On-site staff of the exhibition communicate with customers and discuss cooperation
Independent distributors are the middle bridges between supply and demand, it’s their forever mission to further simplify the procurement process, save costs, improve transaction efficiency, and achieve the maximum interests of their customers by sufficiently matching the upstream supply sources with the downstream demand.
Electronica China 2023 has successfully concluded, but Cytech Systems’excellence never stops there. We look forward to meeting you again next time.