1. Trends in Electronics and Capital Equipment
Susan Mulcahy, VP of Research & Special Editions, Electronics and Manufacturing Divisions, Cahners Business Information
July 17, 2001

2. Trends in Electronics

3. Semiconductor Forecast ($USD in millions)
Americas 64, ,841
Market Share % %
Europe 42, ,231
Market Share % %
Asia/Pacific 51, ,651
Market Share % %
Japan 46, ,430
Market Share % %
Total WW 204, ,153
Source: Cahners IN-STAT

4. Major Industry Trends Time to market driving the industry
Only 53% of designs worldwide actually go into production
Companies less willing to take risks
80% of customers are looking to cut their AVL (Approved Vendor List)
Think about being a partner both with vendors and customers

5. Product Development Cycle
How long is your product development cycle from inception to launch?
(numbers are in months)

6. Vendor Selection
On average, how many vendors will you research before you select a part or product that you believe is not a “major” factor in the design and manufacturing of your product?

7. Vendor Selection
On average, how many vendors will you research before you select a part or product that you believe is a “major” factor and influence in the design, manufacturing and differentiation of your product?

8. Your Challenges & Opportunities
Lack of good customer service and support
Semiconductor downturn means chance to take a closer look at learning your customer’s business
Customers need more help than ever before
Know your stuff!

9. Capital Equipment Trends

10. Methodology
600 Telephone interviews: SI, EP&P, Enews and Electronic Business
Corporate Managers
Engineering Managers
Engineering Staff
All are involved in the purchase of capital equipment
Phone Interviews June/July 2001

11. Purchase of Capital Equipment vs. 3 Years Ago

12. Purchase of Capital Equipment in Next 3 Years

13. Who is Involved?
Which statement best describes how your company selects a capital equipment supplier?

14. Who is Involved on Team?

15. How Long Should Purchase Process Take?
In a perfect world, how long should the capital equipment purchase process be from determination of need to placement of order with a vendor?
Mean= 1.9 months

16. How Long Purchase Process Actually Takes?
In actuality, how long is the capital equipment process from determination of need to placement of the order with a vendor?
Mean= 4.4 months

17. How Satisfied?
How satisfied are you with the current capital equipment manufacturers you use?

18. Problems?
How often do you have technical problems with your capital equipment purchases?

19. Problems?
How often do you have support/service problems with your capital equipment manufacturers?

20. What is your biggest frustration with capital equipment suppliers?
Frustrations
What is your biggest frustration with capital equipment suppliers?
(Unaided write-in)
Delivery/leadtimes= 71%
Communication= 67%
Customer support= 62%
Payment policies= 60%
Quality= 58%

21. What is your biggest frustration with capital equipment suppliers?
Frustrations
What is your biggest frustration with capital equipment suppliers?
(Unaided write-in)
Getting information= 51%
Delays due to down time= 45%
Adequate “tech support”= 34%
Documentation= 23%
Can’t get in touch with them= 15%

22. Are You Talking to Customers About What’s Important? (Mean score)
Quality/reliability= 4.69
Technical expertise= 4.63
Price= 4.39
Customer service/support= 4.35
Ability to meet delivery schedules= 4.32
Throughput= 4.23
Communication= 4.14
Ease of learning= 4.12
Expertise= 4.10
Ease of doing business= 4.03
The Top Things Customers Want

23. What can we learn?
What one major change would you like to see capital equipment suppliers implement?
(Unaided write-in)
Better delivery time= 51%
Easier to contact= 47%
Better pricing= 45%
More compatibility with other equip= 42%
Tell the truth= 35%

24. What can we learn?
What one major change would you like to see capital equipment suppliers implement?
(Unaided write-in)
Better payment policies= 30%
Improve platform support= 24%
Better websites= 19%
More documentation= 11%