By Gina Roos, EBN (02/19/99)   [ SADU Info Page ]

New NIC unit to provide local service to CEMS

NIC Components Corp. has created a new Strategic Global Accounts business unit SADU - Strategic Account Development Unit at its Melville, N.Y., headquarters in a continuing effort to position itself as a global supplier to contract-manufacturing customers. Creation of the business unit was prompted by the fact that major CEMs such as Celestica, Jabil, SCI, and Solectron are building manufacturing facilities all over the world to support their local markets, according to Richard Schuster, president of the passive-component supplier. They are demanding local stocking facilities to meet their just-in-time deliveries and demand-pull inventory requirements, he added.

By offering a global-logistics solution to inventory management, as well as global sales and technical support, Schuster believes that the midsize company can effectively compete with some of its larger competitors.

"The contract-manufacturing business is the fastest-growing market segment in our industry, and as a result, we have to concentrate on servicing that sector of the market," Schuster said. He expects the new unit to grow 50% in sales this year.  

This business unit will focus on building NIC's relationship with large global OEM and contract-manufacturing customers, according to Schuster. And it will also coordinate the logistics flow, tracking design wins to the manufacturing sites to make sure that NIC participates in that business, he said.

One of the challenges is ensuring that the manufacturers' sales representatives and sales people get credit for the design work, Schuster said. In many cases, design work completed in the United States is manufactured offshore, and the sales teams aren't compensated, he noted. In general, the commission will be split 50% between the design and the purchasing site.

EDI [Electronic Data Interchange] will help support communications and inventory-management tasks between the global unit and its largest customers. Last year, NIC took its first steps toward improving service to its large OEM and contract-manufacturing customers in Europe, as well as to the distribution channel, by opening its first overseas sales and warehouse center in Buckingham, England. The center will support the company's contract-manufacturing customers in Ireland and Scotland.

In addition to the Buckingham facility, NIC has warehousing facilities in Melville and San Jose. The company is also in the midst of setting up a joint venture in Singapore with Paxcell Singapore Pte Ltd., which currently serves as a stocking agent for NIC's contract-manufacturing customers in Asia.

NIC is negotiating a 70% stake in the joint venture. The transaction is expected to be finalized in 60 days.
After the Singapore deal is completed, NIC plans to establish a warehousing site in Hong Kong to serve the growing market in China over the next six months. The company currently contracts warehousing services in the region.

NIC expects to establish another site in Europe, and also has its eye on the South American market. The company currently uses a stocking representative in Mexico to support its customers in Latin America. "We are committed to bonded local inventory for all of our customers," Schuster said.

Additionally, NIC recently created two new positions to support the changes. Richard Rubinstein was promoted to director of the new Global and Strategic Accounts business unit. He was formerly general manager. The company has also named Peter Casdia as the new national sales manager for North America. He previously was passive-components marketing manager at distributor Bell-Milgray Electronics Inc. He will be responsible for building NIC's North American business, as well as for driving design wins through its local sales teams and manufacturers' representatives.
NIC, which employs 60, sells capacitors, resistors, inductors, ferrites, and circuit protectors.

For additional information contact NIC's SADU group:
e-mail: sadu@niccomp.com
fax (USA): 1-631-396-7575
phone (USA): 1-631-396-7500 x 1598   

NIC Components Corp. (North America)
www.niccomp.com

NIC Eurotech LTD. (Europe)
www.niceurotech.com  

NIC Components Asia PTE LTD (S.E. Asia)
www.niccomp.com.sg