For years we have been calling them “science projects,” those PCB orders that did not quite fit into our normal process stream and therefore needed special attention, as well as special handling. Often, we have had to use trial and error to come up with just the right process to successfully complete the order. We liked these projects because we learned something from doing them, it made us a better company, and we got paid for doing them as well. It was like paid tuition.
Years ago, this kind of R&D work was done by OEMs in their own in-house PCB shops. Those shops were more PCB departments than P&L centers. Their function was to provide the right technology PCBs for the company to build their end products. The people in these shops would work closely with the rest of their organization developing the right technology boards that exactly met their specific needs.
But, with the demise of the in-house shops, as well as the rise of contract manufacturers, it is now left to those of us still in the business of building boards to provide these companies with their R&D efforts. Which of course means, “science projects.”
The need for R&D is growing. Where we used to take on three or four of these projects a year, now we are seeing three or four or more of them a month, as innovative companies develop products of the future requiring PCB technology that has never existed before. In other words, these companies are shooting for the stars and they expect their PCB vendors to be there with them. And I don’t just mean the obvious ones like SpaceX and Blue Horizon either.
In the past few years, since the great recession, there has been a literal boom of companies establishing new technologies, making great strides, in all fields from medical, to solar, to batteries, to automotive, to communications and computers. All over our country—all over the world—companies are forming partnerships to build products of the future. Products that need not only the latest in PCB technology, but beyond that technology as we know it today.
For PCB fabricators to survive in this new world order, they are going to have to invest in the future. They are going to have to buy the right equipment, hire the right people, and expend the right resources sufficient enough to supply this new breed of customer with the PCBs they need today and in the future.
I also see a time when these new companies will have to invest in existing board shops if they want to get the technology they need to build their new innovative products. This means that, instead of buying their own shops, they can at least own part of one. Board shop owners can expect innovative customers to ask them what they are going to need to provide the kind of PCB technology these companies will require in the future. This is the only way these customers will be able to get PCBs they need.
The PCB market is so competitive that most shops just don’t have the resources to keep up with the needs of the market. Because the market is so competitive, margins—unlike what are customers like to think—are paper thin, leaving very little financial resources to acquire the equipment needed to build the PCBs with the technology these new companies need. Thus, the partnership approach. Our industry has already seen instances where a wealthy OEM will come to a PCB shop asking them what they need in terms of equipment and other resources to build their boards, and then offering to provide the funding that will allow the PCB shop to get those resources. This trend has already begun so we all had better be ready when we are asked the questions, “What will it take for you to be able to build our boards?" And, most importantly, “Can we buy that equipment for you?”
I believe we should look at this trend as a good thing—for our customers and for us. When your high-tech customer comes calling with an offer to invest in your company so that you will better be able to serve him in the future, take the call.
Anaya Vardya is president and CEO of American Standard Circuits.