Counterfeiting is a high-profile problem in many industries, from retail fashion to luxury goods and even the pharmaceutical sector.
But few people realize just how big a problem counterfeiting is for manufacturers that rely on parts suppliers to deliver components and integrated circuits. The global electronics components supply industry does not have powerful checks or balances in place for preventing counterfeit components from reaching manufacturers.
In fact, a 2007 study suggests that 50 percent of original equipment manufacturers and 55 percent of distributors have encountered counterfeit electronic components. There is also evidence to suggest that the counterfeit components market has hugely increased since that time.
Without a standardized approach to identifying and avoiding counterfeit parts, it is up to individual organizations defend themselves against this threat.
According to a report by the Organization for Economic Cooperation and Development, the vast majority of counterfeit products originate in China. The problem is so prominent that even top Chinese innovators regularly find themselves victimized by counterfeiters.
But in the electronics components industry, it’s almost impossible not to buy products from China. The country’s industrial output is simply too large. Manufacturers need to be able to identify the factors that separate counterfeiters from authentic electronic goods manufacturers and distributors.
Tuan Tran, VP of Sales and Marketing at Green Circuits, recalls when one of his customers was duped buying counterfeit integrated circuits from Asia:
“My client was so excited that they found a $15 integrated circuit for only $5 online. The money had to be sent via wire transfer, and when the part arrived, it looked and felt just like the real thing. Despite having the proper markings, like the part number and date code, every single board using the part failed our quality tests. We cross-sectioned the part and found out there was nothing inside – the ‘circuits’ might as well have been painted on.”
Since there is no feasible way to cross-section and examine each individual component in a PCB assembly project, manufacturers need to identify trustworthy distributors and be deeply suspicious of any deal that seems too good to be true.
The only way to adequately protect yourself against counterfeit goods is by establishing relationships with vendors and service providers on mutual trust. When possible, deal directly with the manufacturer, or with an authorized distributor. If that isn’t possible, you will then be forced to contact a broker.
Reputable brokers can connect you with authorized distributors and manufacturers, but others can lead you astray. Approved brokers that are based in the United States and who hold themselves accountable for the products they market can be trusted.
Green Circuits has a strict purchasing policy identifying who we buy parts from. We leverage ongoing relationships with distributors and manufacturers that we trust. This is an important step towards being able to offer top-quality PCB assembly services consistently.