Thanks to being one of the fastest-evolving industries, the electronics industry presents a unique set of challenges to companies of all sizes, particularly to those who specialize in manufacturing electronic devices and components. However, it’s not all bad news because fast-paced changes also mean plenty of opportunities to capitalize on. Knowing these challenges and opportunities are important to make sure the company doesn’t just survive but also thrive in the industry.
Challenge: Increased Demand
The information age caused a surge in demand for various devices and components. One of the best ways to keep up with demand is by taking full advantage of the benefits of automating the production process. It’s now common to have top-of-the-line motion solutions with linear stages and other precision components. These solutions perform production tasks that require a high degree of accuracy and speed, with the ability to perform tasks much longer than human workers can. This allows companies to produce more of their products without sacrificing quality.
Opportunity: Increased Product Diversity
The ability to integrate internet connectivity to common household appliances and to add features normally found in larger devices to smartphones have given the electronics industry a lot of potential to develop newer, more innovative electronic products. On the other hand, components once meant for only one or two types of devices are also being used in other, completely different kinds of devices. This leaves companies with two options: branch out by developing more products or reach out to more clients that now have a need for what they are currently producing.
Challenge: Shorter Product Lifespan
An increase in demand doesn’t always guarantee long-term profits. In such a fast-paced industry, even the most popular smartphone or computer for the month may no longer be in demand within less than a year. This can force companies to make several changes to their products. Training employees to make new products can take a lot of time; by the time training is complete, the demand for the new product may have already declined. This is why many manufacturers resort to automation, which allows machinery to be easily reprogrammed to help create different products as demand changes over time.
Opportunity: Expansion of Target Market
Speaking of expansion, increased consumer accessibility to new devices creates plenty of opportunities for companies to grow, especially on a global scale. Developing countries provide plenty of opportunities to expand their target market overseas. For some electronics manufacturers, increased emphasis on universal compatibility features such as mini USB ports for multiple devices may mean forming partnerships with other companies.
Challenge: Lower Product Prices
A new phone today only costs a fraction of the price of a new phone just a decade ago. With electronic devices becoming more affordable, this presents a big problem for companies: keeping up with demand while still making a sizeable profit. To remain successful, a company may need a combination of staff training, better equipment, streamlining the production process, more cost-effective marketing strategies, and other options that help maximize profit while minimizing production costs. Stagnation can quickly lead to dwindling profits in a matter of months. The most successful manufacturers can maintain or even increase profits, giving them a better chance of expanding later on.
Opportunity: Better Age Demographic
As electronic devices become more versatile and easy to use, more people are now more inclined to buy electronic products. While the main focus these days seem to be consumers within the 18-34 year old demographic—since they are more inclined to use electronic devices for accessing social media than other demographics—newer products with better interfaces has also increased the demand within older and younger generations.
The electronics industry has seen more changes than any other industry since the start of the 21st century. This may also mean that the biggest challenges and opportunities for electronic manufacturers today may be completely different from what companies have to deal with in the future. Innovation, efficiency and expansion are the biggest factors that will separate the most successful companies from those that fail to adapt.