USB Flash Drives

and Copper
Supply Market Intelligence

Steven DeRicco, Rushi Dong, Alexis Lee, Kristen Turner

Project Scope and Timeline
Objective:

Gather supply market intelligence and provide procurement recommendations for USB flash
drives and one of its key supply items, copper.

Product Industry Supply Procurement

Deconstruction Analysis Analysis Recommendations
Product Deconstruction
Essential parts of a USB flash drive include:

Board Memory Chip

- Holds all of the internal components and
includes the USB connector
- Stores data

Controller Chip Plastic Cover

- Retrieves information from the drive and - Protects the electronics against
reading/recording information on the mechanical stress and even possible short
NAND flash memory storage chip circuits

These components typically contain silicon, copper, iron, aluminum and

traces of other metals--copper being one of the most common elements
Industry Analysis/Trends For USB flash drives
As of 2016: Top 3 regional markets that have the most
Information Technology potential for growth:
(IT) industry is a $3.7
trillion dollar market
Most of the industry is
comprised of small
businesses
31% of revenues come
from the USA, while
Southeast Asia comes at
a close second at 29%
Industry Analysis/Trends
Leading competitors in the global
USB flash drives market:
SWOT Analysis for Key Supply Item-Copper
Strengths Weaknesses
-Limited supply adds value - Limited supply can lead to shortages
-Wide array of uses -Can be costly

Opportunities Threats

- International expansion of the element - Shortage expected by 2018

-Increasing demand can lead to growth for -Competition can be fierce not only for
companies copper, but for cheaper, substitute metals
Porters Five Forces Analysis On Copper World Mine Capacity

Force 1: Market Internal Competition 2012 83.4

Moderate to high 2013 87.6
growing pressure from foreign mining
companies 2014 85.6
Force 2: Threat of New Entrants 2015 85.4
Moderate to High
Foreign countries becoming more 2016 87
interested in supplying expensive metals
Force 3: Pressure from Substitutes High
many alternatives available to
consumers
Force 4: Buying Bargaining Power Low
Limited supply of copper allows
suppliers to increase prices
Force 5: Supplier Bargaining Power High
Limited supply of copper makes prices
more inelastic
Supply Segmentation Matrix
Critical
Bottleneck -Controller Chip (and
High
-NONE respective metals)
Complexity/
Risk Impact
Leverage
Routine -Memory chip
Low -Plastic covering -Board
(and respective metals)

Low High
Value
Issues for the Copper Industry
Union strikes (especially in Chile)
Astronomical increase in demand for copper due to
new/large/unexpected construction projects
Environmental issues/pollution from the dust formed while mining
High energy needs in order to mine copper
Procurement Recommendations
Invest time in effective contract management especially on quality
terms
It is paramount that we manage contracts correctly to mitigate risks, while taking
advantage of procurement opportunities. A decrease in quality can make
consumers turn to other firms.
Group buying (Invest with others)
Increasing our buying power will provide us with better prices during
negotiations. There is also the added benefit of buyer expertise for each category.
Divest from higher cost economies
Economies are slowing diverting back to pre-2008 statuses, with increases in
operating costs, prices, and inflation. It would be wise for us to globally source
specific components from lower cost economies. Obviously, due diligence is
needed when sourcing such suppliers, which is why we will utilize the expertise
from global online marketplaces.
References
https://www.comptia.org/resources/it-industry-outlook-2016-final

http://www.mbaskool.com/brandguide/it-technology/4461-sandisk.html

https://howflashdriveworks.wordpress.com/what-is-a-flash-drive/

https://users.ece.cmu.edu/~omutlu/pub/main-memory-system_kiise15.pdf

http://www.strategyr.com/MarketResearch/USB_Flash_Drives_Market_Trends.asp

http://clients1.ibisworld.com/reports/us/industry/currentperformance.aspx?entid=741#CP

http://www.ironpaper.com/webintel/articles/it-market-statistics-and-trends/

https://www.statista.com/statistics/271726/global-market-share-held-by-dram-chip-vendors-since-2010/

https://writepass.com/journal/2013/01/bhp-billiton-swot-analysis-and-porter-five-force-analysis/

http://investingnews.com/daily/resource-investing/base-metals-investing/copper-investing/top-10-copper-producing-companies-2/

http://www.icsg.org/index.php/component/jdownloads/finish/114/2238?Itemid=