What Are The Reasons For The Increase in PCB Cost

The operating performance of circuit boards in the first quarter was good, but looking forward to the second quarter, because PCB manufacturers are mainly based in China, many manufacturers are concentrated in Shanghai, Kunshan, Suzhou, the center of epidemic control, and the second quarter was originally planned. The low utilization rate of the industry in the off-season, coupled with the increase in various costs and expenses due to the closure and control, is a double-sided attack on the gross profit margin. But we, Beton Technology, are located in Shenzhen, and the epidemic is not a big factor. You can contact us at any time if you need it, and we will be happy to quote you.

Low demand in off-season, lower utilization rate

The second quarter is the traditional off-season for PCBs. Especially this year, China's mobile phone market has increased noise and doubts about demand. Other electronic products such as NB and TV also have a wave of corrections in demand. This year's off-season effect is obvious. On the other hand, the EMS factories of the main PCB customers are affected by the sealing and control, especially the EMS factories in the Pearl River Delta and the Yangtze River Delta are also in the core area of the sealing and control. In the second quarter of the PCB factory, the utilization rate decreased to a certain extent, and the decrease in the utilization rate had a certain impact on the gross profit margin.

Transportation detours, freight prices increase

The industry said that the factories that can still maintain normal shipments, and because some traffic sections are temporarily closed, so in the past, direct point-to-point transportation was possible, but now they have to take a detour or a third place (unregulated city) for delivery, and the transportation distance increases. On the other hand, the transportation price is not at the level of the past. In the case of manufacturers rushing for transportation capacity, the freight price has also increased compared with the previous price, and the manufacturer can only accept it.

Grab raw materials to prepare inventory and raise costs

Since many manufacturers in closed-controlled cities adopt closed-loop production methods, or prepare inventory for customers during the peak season in the second half of the year, but since they want to produce, they need certain raw materials, so many manufacturers have also exhausted their methods. See if you can pull up the inventory of plateau materials, or you can find other sources of materials nearby in the closed city (that is, you can't be restricted by the blockade and control and cannot go out of the city), but it may not be the most economical cost, and you need to pay extra. fee, but only acceptable.

Strengthening management and control of personnel, increasing supporting costs

The most tedious part of the increase in closure and control is the management of personnel. One part is to maintain normal production. Manufacturers with dormitories hurriedly call their employees back to the factory to live in the factory and implement the diversion, but the relevant supporting facilities or living materials must be prepared. Employees should also send someone to deliver the equipment needed for work to their homes.

In addition, if employees need to be quarantined or take leave due to lockdown or confirmed diagnosis, the manufacturer still needs to pay salaries, or even if there are insufficient staff, they cannot make up the manpower and cannot raise the utilization rate, which means that the utilization rate and the shipment rate are both be impacted.