Unpredictability has become the new norm in the electronic manufacturing sector in recent years, and 2025 is shaping up to be no different.
However, with over 23 years in the sector, Component Sense has experienced varied market conditions, and our subject matter experts have valuable insights into what may be coming in the next 12 months.
The World Semiconductor Trade Statistics (WSTS) organisation predicts that the global semiconductor market will grow by 11.2%, taking the global market valuation to about $697 billion. However, this is just one part of the picture. Our leadership team provided their predictions for the year ahead, including opportunities for electronic manufacturers and potential challenges.
Predictions from Chief Technology Officer, Grant Rutherford
“There is a growing demand for electronic manufacturers to operate more sustainably. I believe it will get to a point where companies cannot afford to minimise their waste and carbon footprint.
Procurement professionals in 2025 need to get ahead of the curve on sustainability. Start by determining what percentage of your Bill of Materials (BOM) can be considered 'green'. When sourcing parts, prioritise purchasing from existing stock in the market before buying new from manufacturers or their franchise distributors.
This year, I expect there to be good availability of most parts through franchised distribution. However, this will only be the case if there are no significant supply chain issues and disruptions — geopolitical, environmental, or otherwise.
Finally, I anticipate that, like years prior to the shortage market, procurement professionals will continue to look for ways to save on their BOM costs. I believe the biggest savings opportunities can be made by looking outside of franchised or direct sources to trusted suppliers on the secondary market.”
For more insights from Grant, read our explainer on the electronics secondary market.
Predictions from Sales Director, Rose McGee
“Even at the start of 2025, I am already seeing interesting developments and trends. Right now, we are experiencing many procurement professionals and component brokers buying up large quantities, and I believe this is because of question marks surrounding potential tariffs and other decisions from the US Administration. The upcoming Chinese New Year, with many businesses in Asia taking time off, may also be a factor.
I expect OEMs (original equipment manufacturers) to increase orders for major accounts, with many exciting developments on the horizon regarding IoT (Internet of Things), AI (artificial intelligence), and other technologies. For electronic manufacturers wanting to redistribute their E&O (excess and obsolete) component stock, this is good news, as there will be increased demand for stock and potentially higher sales margins.
This year, I believe that procurers will continue to explore diversifying suppliers to minimise supply chain risks, including geopolitical uncertainty and severe weather events that are only increasing due to climate change. At Component Sense, our sales team is developing a new API (application programming interface) to make it even easier and more efficient for buyers to source brand-new, fully traceable stock with us. This year more than ever, people will demand quicker lead times and competitive pricing.
With Donald Trump officially taking office on the 20th of January, it will be interesting to see how the delicate global electronics supply chain is impacted.”
For further insights from Rose, read our tips for sourcing from the secondary market.
Predictions from CEO and Founder, Kenny McGee
“I expect 2025 to be a positive year for the electronics sector. Last year saw a flat market, with many electronic manufacturers sitting on high levels of inventory. This year, I expect conditions to be more profitable for companies wanting to redistribute their E&O inventory.
I am watching with keen interest to see how trade tensions between China and the U.S. unfold. With companies potentially looking to shift operations back to U.S. soil, this may cause some chaos in the manufacturing landscape. Assuming there is no worsening of geopolitical tension in Taiwan, I also expect there will not be any major material shortages this year.
2025 will see more of a focus on sustainability than ever, and I am excited by this. Manufacturers will be looking at their supply chains with a keen eye to be more green, including ensuring that all raw materials going into products are ethically sourced. As part of sustainability efforts, reshoring will continue to be a hot topic, with companies not only looking to bolster supply chain resilience but also to minimise shipping.”
For more insights from Kenny, read his CEO highlights and top learnings from 2024.
Foster a more resilient supply chain this year
As we gear up for a big year ahead in the electronic manufacturing industry, the opportunities that the year may bring are exciting. As always, it is the companies that are most adaptive to change and have a robust strategy that are most likely to succeed.
It is also becoming more clear how important sustainable practices are—not only to do the right thing for the environment but also to send the right signals to business partners and customers.
There are many reasons why better inventory management can help to position you for success. Contact Component Sense today to discuss how simple and cost-effective it can be to redistribute your surplus component inventory.