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Effective Supply Chain Management for Lighting Manufacturing


Advances in technology and continuous R&D activities have helped the LED lighting industry to evolve at a very fast pace. This dynamic sector also witnesses fasting-changing trends, hence, managing a huge supply chain is quite a challenge. Much depends on following certain best practices to manage the complex supply chain for manufacturing LED lighting products, because the shorter the lead time, the less complex the inventory management will be. Effective chain management can  increase the efficiency of the complete production process.

“Supply chain management plays a important role in the LED lighting industry, especially for the Indian manufacturers, who are generally small players compared to the global manufacturers. In this industry drivern by fast-changing technology, one must the fact that the life of a LED product can be as short as 9 or 10 months. It is very likely that just after a year, one might bot see the same product moving into the market again. Parameters such as the timeline for developing new products, the volume of products and the timeline for investments are also important considerations. ” Ajay Goel, CEO of Goldwyn.

According to Ajay Goel, the flollowing factors must be kept in mind that while managing the LED supply chain.

Minimum stock levels

Stocking is a major concern in the supply chain management today. With technology evolving so rapidly, the products or components in stock today may not be relevant in the future. One has to identify local sources that can offer global quality levels and price competitiveness.

Procurement from a minimum number of suppliers

There are about 50 global manufacturers of LEDs selling in India, some are Cree, Philips Lumileds, Osram, Nichia, etc. Indian LED lighting companies tend to choose either the low cost LED manufacturers to produce components from or they switch between different manufacturers quite often. It is not a good practice, choosing a minimum number of suppliers and procure component from them regularly. It will not only develop a rapport with them, but they will also give you a good price. If you keeping changing suppliers, you will not get the right components at the right price.

Sourcing Components Practics


Choose a minimum of two and a maximum of three suppliers

LED should be LM80 approved

Buy only from authorised distributors

Electronic parts , PCB, Drivers

Source resistors and PCBs from domestic suppliers

Source electrolytic capacitors and connectors from good source and from authorised distributors

Source active parts only from authorised distributors

Choose a maximum of 2 reputed suppliers for drivers, both of whom can offer a warranty of a minimum of 3 years

Buy drivers only from authorised distributor or directly from manufacturer

Die-casting, extrusions

Develop tooling only for high volume items

Standard sourcing for low volume products

Secondary optics

chose a minimum of 2/3 suppliers

Optics should have the maximum light transmission ratio

Thermal interface materials

Choose a maximum 2 suppliers

Buy only from authorised distributors/ dealers or directly from manufacturers

Choosing authorised dealers

The LED industry has attracted a lot of dealer, distributors and stockists. With so many dealers in the market, one has to be careful about the authenticity of a product as some of them might be selling rejected stocks. Hence, one must buy only from authorised distributors, even if it costs a little more.

Quality assurance of purchased parts

Maintaining the quality of a product is a major requirement, hence the components procured should also be of assured quality. For example, Buy LED that conform to LM79 standard. Some of Chinese and Taiwanese companies offer LEDs which are practically half the price of that being offered by reputed players. These products do not comply with any standard. If the LED does not meet the desired standard specifications, they may either deteriorate fast or may change colour quickly.

Similarly, the driver which is the most important part of an LED light, should be of a renowned brand. One has to be careful while choosing LED drivers as there are many Chinese as well as Indian manufacturers, who offer LED drivers at low cost with no warranty or papers. If the drivers are not reliable, the lights will fail every 2 months. In such a case, a manufacturer will have to spend more money on servicing and repair and will also lose credibility in the market. Users should also keep in mind that the drivers made in EU may not work in India because these products are not made keeping in mind that the problems of voltage fluctuations and high power that we face in India.

Optic are also crucial for LED lights. There are many big players in India, China and Taiwan, we should always ensure that optics are made of good quality material. Sometimes, poor quality materials may exhibit properties that are similar  to good quality materials, but after sometime, they deteriorate, affecting the optics immensely. So one has to be very careful about buying optics from a reliable supplier. Also Using cheap diffusers may reduce the life of the light products.

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