A new year may bring fresh opportunities, technological advancements, and room for innovation — along with its share of unforeseen challenges.
Your supply chain must be resilient and agile to prepare for what is to come. Optimising your component inventory management is a key step to positioning your company for success. Here are five reasons this year is the best time to redistribute your excess and obsolete (E&O) inventory.
1. Preparing for positive market predictions
During and directly after the COVID-19 pandemic, redistributing E&O stock was particularly lucrative for companies. These conditions were mainly because of the component shortages at the time.
The purple patch eventually led many procurement professionals to overorder parts to offset past shortages. The over-forecasting caused a flood in the market with component stock, which, although still profitable, made it less lucrative for companies to sell obsolete electronic components as there was less demand.
The good news is that this flat market is anticipated to end in 2025. After years of volatility, the market for buying and selling components is expected to stabilise, with overall excess inventory electronic component levels lowering and predicted growth across manufacturing sectors, including IoT (internet of things) and EV (electric vehicles). In fact, S&P Global Mobility predicts that EVs will account for 16.7% of global vehicle sales this year, up from 13.2% in 2024.
An upswinging market in 2025 means more opportunities for OEMs (original equipment manufacturers) and EMSs (electronics manufacturing services) to yield a positive PPV (purchase price variance) through the redistribution of E&O parts.
2. Supply chain resilience
The pandemic was just one of many disruptions affecting the global electronics supply chain in recent years. Despite strong projections for the secondary market for components in 2025, supply chain risks remain ever-present, if not increasing.
A key example is the ongoing trade tensions between China and the U.S., where sudden tariffs force manufacturers to rethink sourcing and operations.
Geopolitical uncertainty is only one contender among feared supply chain disruptors. Extreme weather events, which cause transportation delays and impact factories, are also significant risks. More than 99% of executives surveyed by Economist Impact stated that the environment impacts their supply chain.
Procurement professionals are increasingly forced into multi-sourcing strategies, and nearshoring is becoming more tempting. Redistributing E&O stock to keep inventory levels optimal is another key consideration for supply chain resilience. Doing so creates an additional revenue stream and frees up warehouse space, ensuring you remain agile and ready for whatever 2025 may bring.
Component Sense E&O solutions like InPlant™ or consignment allow regular monthly payments as your surplus stock is sold over time. We connect your surplus inventory with electronic parts buyers and act as a PCB component marketplace.
3. Meeting increasing partner demand for sustainable practices
More companies are shifting towards sustainable business models and circular supply chains. As electronics manufacturers continue to work towards their ESG (environmental, social, and governance) goals, they evaluate the implications of their entire supply chain.
With new targets, particularly regarding carbon footprints and electronic waste (e-waste), electronics manufacturers are increasingly pressuring their suppliers and partners to demonstrate sustainable practices.
Regulatory pressures, such as the European Union's Corporate Sustainability Reporting Directive (CSRD), are also forcing companies to adopt more sustainable supply chains. Rules and regulations like these are expected to increase, ensuring businesses contribute to global climate change and sustainable development goals.
To meet your partners' sustainability demands and show proactive thinking, redistribute your E&O inventory with sustainability-driven companies like Component Sense, demonstrating your commitment to a circular economy. Circularity maximises the lifetime value of raw materials in components and reduces the need for virgin material extraction.
4. Combatting worrying trends regarding electronic waste
At Component Sense, we frequently discuss the worrying projections regarding society’s e-waste generation. The e-waste created globally is expected to reach 82 million tonnes in 2030.
As e-waste generation increases each year, electronics manufacturers' role in leading by example and promoting a circular economy becomes increasingly crucial. 2025 is set to be a pivotal year in which manufacturers must reduce their waste.
Redistributing surplus electronic parts through the secondary market ensures components are used for their intended purpose. This prevents harmful chemicals and materials from ending up in landfills, polluting the environment.
5. Getting ahead of shortening product lifecycles
As technology advances rapidly, product lifecycles in many industries are becoming increasingly shorter. These rapid advancements make the electronics sector exciting but also create challenges as components become obsolete faster than ever. Ultimately, warehouses end up full of surplus parts.
Warehouse space should be seen as a financial resource, and your shelves must be filled with high-value stock relevant to your current production schedule. The last thing you need is high levels of E&O inventory, which prevents you from pivoting to new product designs quickly. Not to mention, you are paying storage costs for this inconvenience as well.
Redistributing surplus stock frees up space and capital for you to source parts for upcoming projects quickly. With no slowdown in sight for 2025, securing a long-term E&O solution now can position your business for sustained success.
Make a positive change to your supply chain this year
2025 is shaping up to be a big year for the electronics sector. Set yourself up for success by taking control of your component inventory. These five reasons to redistribute your E&O stock this year are just the tip of the iceberg.
Partner and sell excess electronic components with Component Sense to ensure your surplus stock is handled and redistributed profitably for you with minimal fuss. We have a wide network of electronic component brokers and other companies who buy electronic components.