Best practices that help mitigate the risk of counterfeit electronic components.
Counterfeit electronic components have always been a paramount concern in the electronics manufacturing industry. In recent years, the ease of their production has increased and created a significant impact. According to recent reports, consumer and industrial businesses have lost approximately $250 billion in the last few years due to the production of counterfeit electronic components. The consequences of counterfeit electronics pose a serious threat to consumers. So, it is essential to adopt electronic components counterfeit mitigation strategies.
What are counterfeit electronic components?
Do you know what is counterfeit? Well, this term is defined as a fraudulent part, meaning it’s a “copy, imitation, or substitute” labeled as genuine without possessing any legal rights. It intends to defraud or deceive. If you own a business having counterfeit parts, you may face some issues due to the following reasons-
- Flaws in the logistic plan.
- Insufficient inventory for product lifecycle
- Outdated electronic components or parts
- Procurement issues or cost savings over trusted sourcing
- Failure to use data for authentication
- Lack of quality assurance
- Throwing excess inventory
- Issues in distribution such as deliberate misrepresentation
- Lack of sufficient law enforcement resources that help track down counterfeiters
What are the significant impacts of a counterfeit electronic part on a business?
Some of the possible consequences of counterfeit electronic parts are described here-
Personal injury that occurs due to product defects
Everyone wants to buy a product from one of the best electronic component suppliers that can ensure the best quality along with the safety of people. No one wants their product to cause any injury or death. But the fact is, this happens in some cases. And it is important to protect the consumers from counterfeit parts.
Even a small injury can derail businesses. It can damage their brand image and company’s reputation. As a result, customers can lose trust in the company.
Increased chances of recall or product replacement
When your product does not function as desired, you may have to face the issue of correcting the problem. If there is a problem with a product recall, it can lead to a negative impression of your company. And it can have a long-term negative impact on your business.
Manufacturing downtime
Once the counterfeit part is discovered, companies often halt their manufacturing operations and consider investigating to determine its source. And the time invested in resolving this issue can have a significant impact on your company’s productivity.
Not only do you have to look at the cost of material in the replacement part, but you also need to spend some time investigating the issue. In addition, you will have to devote some time retrieving all the damaged products, repairing damaged units, and sending them back to your consumers. And all these things will cost you even more. Also, don’t ignore the unbearable cost of your poorly reputed company. You may lose your loyal customers.
Potential penalties
Depending on the type of product and its condition, companies utilizing counterfeit electronic parts may be subject to potential penalties from the government authorities or other regulatory industries. You may have to pay heavy fines and penalties due to counterfeit claims.
Best practices to reduce the risk of counterfeit electronic components
The risk of selling a product containing a counterfeit part can be reduced in some ways. Some of the most compelling ones are-
- Develop strict procurement policies- Businesses must ensure that their products or parts only come from trusted electronic components distributors or reputed suppliers. When researching distributors and dealers, make sure to enquire about their quality assurance processes. Ask them about their product handling, storage, and shipping processes.
- Inspection– Visual inspection is an important part of quality control processes. It’s a simple yet effective method to control the production of counterfeit parts. It is best for electronic manufacturers to keep a complete record of inventory. Doing so can make it easy to ascertain the validity of components. Also, do not forget to inquire about the best practices and standards of any electrical components manufacturer or supplier.
- Chain of custody- Some ways to reduce the risk of counterfeiting include strong shipping, handling, and storage processes. Before booking your order for any product, it is best to gather some information from the suppliers and distributors. Ask them how they handle components while they are in storage and sent for transportation. Remember, quality control is a must in every process.
- Awareness and detection- Consumers should buy products from companies that take an active approach to quality control measures and inspection. Staying up-to-date with government warnings/rules and regulations, and collaborating with others in the industry, is another great way to combat counterfeit parts and fraud.
Are you planning to buy any electronic components? If so, purchase it from a reputed and trusted electronic component supplier only! Contact our experts today to buy our electronic components at Resion LLC today! or Call us at (516) 742-6300