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Global Purchasing Index

By Victoria Fraza Kickham, Distribution Editor

A monthly benchmark that gauges purchasing professionals’ views on procurement activity in the electronic components marketplace. A reading below 100 indicates pessimism; a reading above 100 indicates optimism.

Buyers Maintain Optimism in February

Economic outlook among electronics purchasing professionals remains virtually unchanged in February, as buyers cite an increase in new orders from customers and a rise in purchasing activity.

February ResultsDespite rising prices for certain electronic components, members of the Global Purchasing Index panel reported continued economic optimism in February. The GPI remained largely unchanged during the month—slowing just .003 percentage points compared to January—as buyers cited increasing orders from customers and an uptick in their own purchasing activity.

The GPI registered 117.25 in February, staying well above the 100-point mark indicating economic optimism.

“The winter/holiday slump is cycling down, finally, and new orders are increasing in the pipeline,” one panel member commented. “2015 looks to be showing more promise than 2014.”

Compared to January, the new orders index rose 8% during the month and the inventories index declined 9%, panel members said. They also reported a 4% increase in their purchasing activity, and noted that they are paying higher prices for many components; the GPI pricing index rose 3% during the month. Lead times shrunk, according to the panel, as the lead times index fell 7% during the month.

“We are seeing an increase in the cost of materials and components, where last year was more stable during the year,” one panelist said.

The GPI has dipped below 100 just once since its launch in January 2014. It fell to 99.05 in December, when panel members reported slower seasonal conditions. Otherwise, it has remained in positive territory, and soared this January to 117.6 after the December decline.

Global Purchasing’s GPI measures purchasing professionals’ business confidence in five areas: new orders from customers; electronic component inventory levels; purchasing activity; pricing; and lead times. Global Purchasing compiles the GPI data monthly from a survey of more than 100 panel members who buy a wide range of electronic components. Prequalified for their industry experience, panel members are purchasing executives, managers, or buyers at original equipment manufacturing (OEM) or contract manufacturing firms around the world.

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