Shammy Khan on the Logic behind EMS - buildaroo.com

Shammy Khan VP of Flextronics, a leading EMS company that offers complete design, engineering, and manufacturing services to a variety of industries, explained why OEMs (original equipment manufacturers) should consider using EMS (equipment manufacturing services) companies.

Today there is an oversupply of solar and hence fierce competition. What differentiates companies is not their solar panels, but their sell. Price is going to continue to drop, and in order for a company to survive it will need to focus on scaling. In addition, a company needs to have a superior cost structure because at the end of the day, price is #1. Shammy advises companies to outsource to an EMS anything that is not their intellectual property. Many EMS companies today have the capabilities to build solar inverters, junction boxes, build PV modules. You can source the cells, consign them to the EMS company and they can build the PV module for you.

Why outsource to an EMS?

1. Allows company to focus on what they do best, their product technology, without worrying about the logistics necessary to get product to market
2. They know how to manage cost, inventory and assets
3. Already have infrastructure in place for production and distribution
4. Distribution locations in many different geographies - allows products to get to end user faster.
5. Vertical capabilities in multiple countries in the same geography
6. "Super Campuses" with 70,000 people on site with suppliers co-located on site - Advantages of this are elimination of lead time, reduction in packaging cost reduction in freight cost, and hence continues to take cost out of the system.
7. Helps you manage foreign duties and currency shifts more easily
8. Understand other cultures and what it takes to manage a company in various countries.
9. Allow company to scale faster and much more easily
10. Save the money necessary to build new factories.

Shammy was a panel member on "Fueling PV Growth Through Manufacturing" at "Growth Opportunities in the New PV Market: Projects, Finance and Policy" event by Greentech Media in partnership with the Prometheus Institute.

Category:

Science & Technology

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• Shammy Khan
• flextronics
• EMS
• OEM
• buildaroo
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• intersolar
• green building
• solar
• sustainable building
• renewable energy
• clean energy