Are Supply Chain Issues Hurting the Fiber Optics Market?
Vitex Has Reassuring Answers for Customers
When Covid-19 came to the US surreptitiously in 2020, it hobbled the country. Within weeks, cities like NY went dark.
The way we work changed: much of the workforce moved to home-based offices and online meetings. As these disruptions in our lives drag on, working remotely continues, creating many IT challenges.
Fiber optics plays an integral role in supplying global Internet connections, so demand has grown. However, the global supply chain disruption is a huge challenge. Dwindling supplies of products from toilet paper to building supplies are now the norm. Fiber optics is no exception.
Supply Chain Issues in the Fiber Optics World
China is strategically important to the fiber optics industry. Most manufacturing is done in Asia, particularly China, and as Covid continues to loom over China, government-imposed factory shutdowns are a very real concern.
Simultaneously, fiber optic transceivers and components are in greater demand than ever because they’re faster and more reliable. Vitex, for one, has experienced higher customer demand for our quality fiber optic products due to network upgrades and data center demand for higher bandwidth. These upgrades are required to meet the technical needs of a remote work force.
Vitex is not alone. In a December 2021 article for Broadband Breakfast, Benjamin Kahn brings in experts to discuss these issues. “At the end of the day, it is fiber, fiber, fiber… because whatever we are doing has to survive for the next 20, 30… (or even) 70 years.” But “getting the equipment – has been torturous,” says Shirley Bloomfield, CEO of NTCAs Rural Broadband Association”.
Many are worried price increases will be just as torturous, projecting as much as 35% increases.*
Communication and planning are key
It’s not all doom and gloom. Michael Ko, Director of Business Development had this to say on availability and pricing of Vitex fiber optic solutions, “Good communication, strategic planning and astute inventory management have allowed us to achieve minimal disruptions in lead-times and product delivery. At this time, we are not passing on price increases to customers. As technology advances, prices typically go down. We’ve been able to pass on our savings to customers.”
Based on news headlines, customers are asking about what we know and see in the fiber optic market; we are being 100% transparent and continue to:
- Increase our stock of popular products;
- Update customers regularly (sometimes daily) and communicate with manufacturers to stay on top of materials, labor, and logistical challenges;
- Identify alternative manufacturers in Taiwan and Korea that we can call on;
- Monitor costs. Technology traditionally has found ways to lower costs while enhancing quality. Experts agree.** We’ve actually reduced our prices for certain popular products.
Going Forward: Predictions and Recommendations
From our perspective, we can’t control or foresee what the US or Chinese governments will do or the possible geopolitical issues that may arise.
But to minimize business disruptions, we recommend customers
- Stock up now so you have a cushion in case it takes more time to get a product you need;
- Increase communication with vendors so they can stay on top of supply or shipping challenges;
- Be flexible. Certain low or high-end products may require additional development and shipping time; 4-5 weeks lead time may extend to 8-10.
- Plan ahead as much as possible: forecast your product needs and share this information with your vendors.
That being said, we are confident going into 2022 we can respond to challenges and meet customer needs.
For more information or to discuss your product needs, email email@example.com
***For more information, see Optics & Photonics News – Supply Chains and Pricing in Optics and Photonics (optica-opn.org)