How would you describe current business conditions in your industry?
Most of the products that we sell are considered capital expenditures for most of our customers. Our business is split between government and commercial clients. Both of these segments are managing their budgets very tightly and are being extremely selective about their capital expenditures in 2014. As a result, deals are taking longer to mature and we’re being forced to adjust our manufacturing schedules accordingly.
What are your greatest concerns about the electronic components market?
The electronic components market is constantly changing. We source out several government projects opportunities each month and are always coming across obsolete and hard to find components. This greatly affects the way we bid and schedule our deliveries.
What are some of the supply chain issues that “keep you up at night?”
We attempt to deal with vendors that consistently deliver on time and provide a superior product to the marketplace. I get extremely concerned when materials and scheduled deliveries don’t arrive at the time promised. This forces our plant managers to shift priorities and often reduces the efficiency of our manufacturing schedule. It’s never an easy task to explain why material doesn’t arrive on time. Our purchasing team is always monitoring delivery schedules and keeping in constant contact with our suppliers to minimize these adverse situations.
Do you think the overall economy is improving? Why or why not?
The overall economy is slowly improving but our commercial and government clients are being reluctant to grow their capital expenditures and are being forced to cut their budgets where they feel there is an opportunity. Hopefully the economy can pick up some momentum in the second half of 2014 and our clients will start to become more confident in their ability to maintain earnings. When this happens, they can begin to invest in new equipment. However, this economic improvement will be slow as a result of our current Administration is putting “headwinds” in the market with more and more regulations. These regulations make it extremely difficult for our commercial clients to plan for their futures. When there is uncertainty in the market, our customers don’t aggressively purchase capital equipment.
How would you assess your business confidence over the next month?
We currently have several deals in our sales pipeline that have the ability to make 2014 a fantastic year. Our sales team in working hard to nurture those relationships and hopefully close the business. When those purchase orders get issued the purchasing and manufacturing teams are standing by to execute, manufacture, and deliver the best product possible to our client.
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