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Interview

Indian market is the most demanding.


By focusing on domestic market you
can win the race

Dinesh Singh, CEO, LWI Electronics


Inc., talks to Atul Goel from
EFY magazine, about the electronic
components market and their strategy

Dinesh Singh
CEO, LWI Electronics Inc.

How do you see the market for electronic components


in India?
Unfortunately, due to inclination towards foreign
goods, majority of the Indian franchises are more of
brokers and not stockists. They order semiconductor
components from foreign countries and then supply
the same. However, the business is not as rosy as it
appears. Equipment routed from China and Singapore
throw up major challenges. Here devices are tampered,
refurbished, counterfeited and quality standards are not
met. This is affecting not only India but also the global
market.
Some customers, who fall prey to the cheap Chinese
parts, often come back to us in their production crises for
genuine parts after losing time and revenue to such faulty
parts.

What are the key developments happening in the area of


electronic components?
With the growing middle-class population of nearly
400 million people, Indias electronic equipment consump-

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tion, which was estimated at around $110 billion in 2010, is


expected to reach $363 billion by 2015.

What are the main component-types that LWI distributes?


LWI distributes military/industrial grade parts like
integrated circuits, capacitors, resistors, discrete devices,
linear logic, digital signal processors, dynamic random
access memory, static random-access memory, cache
memory, connectors, LAN products and much more. LWI
stocks obsolete products that even the manufacturers do
not keep. Today LWI stocks over 100,000 line items of new
and obsolete semiconductor components. We expect to
double our line items by 2013.

LWI stocks obsolete products that even the manufacturers do not keep. Is there a considerable demand for such
products? If so, from whom?
If you think obsolete electronic spares are worthless just
because the market is flooding with novel electronic items,
which become out of date within a short span, then you
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Interview
space and key inventory
must re-look on obsolete
management practices.
parts from our point of
With the growing middle-class populaLikewise, to be successview. We are strongly bettion of nearly 400 million people, Indias
ful in any business one
ting on the business of givelectronic equipment consumption,
needs to understand the
ing fresh life to these obsowhich was estimated at around $110
market needs. Since its
lete parts. Its not so easy
billion in 2010, is expected to reach
inception, LWI designed
but worth over long run in
a strategy to be in touch
supporting our customers
$363 billion by 2015
with their customers on
in shortage/line stoppage
regular basis and do a
scenarios.
thorough study of current market scenarios.
A simple example is: Once a submarine made in
1980s was stranded due to unavailability of a few critical obsolete parts. The manufacturers of those parts were
LWI also buys OEM excess materials and inventories in
no longer in business and LWI came for rescue with the
bulk. What is the strategy behind this?
tough-to-source parts. Today that submarine is cruising
Most of the time franchise distributors sell comwell.
ponents to our OEMs in minimum order quantities
(MOQ). For example, even if an OEM needs, say, 10
In crises we also suggest the latest alternates to our cuspieces for production but franchise distributors sell them,
tomers for some of the most antique parts.
say, 4000 as MOQ, the remaining 3990 become an OEM
excess.
What are the challenges that you face in stocking obsolete products, and what trends do you foresee in this line
OEMs sell us their excess, new and unused stock
of your business?
parts. We also have a no-minimum-order policy on
stocked products. This has been possible due to our
This business requires high-risk appetite and fustrong roots in the international market at the supply end
ture anticipation capabilities. It also requires managof the components industry.
ing a huge inventory, massive investment, large floor

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