There is little doubt that the electronics industry is finally showing signs of steady recovery following a few difficult years since the Year 2000 boom. The latest figures from In-Stat show that the semiconductor industry is set to grow by 29percent in 2004.

This is, of course, great news for manufacturers and reseller. More demand is creating more business. But it also means that the fabrication plants are becoming overwhelmed by the orders flooding in, and they are struggling to meet the renewed demand. This has inevitably resulted in the reappearance of counterfeit electronic components.
Counterfeiters take advantage of manufacturers and resellers who are desperate to get hold of vital components. They lure companies in with the promise of low prices and quick delivery times.
Component manufacturers have tried to prevent counterfeiting through strategically placed logos, alphanumeric marks and bar codes, only to have these markings reproduced on substandard components and sold as original equipment.
Sometimes the counterfeits are so authentic that it is almost impossible to tell the difference until the part has been placed onto printed circuit boards (PCBs).
There is no denying it, counterfeit components have become a big problem again.
As a result, we recommend that companies put in place extra checks and procedures when buying components.
The following hints and tips to help could help you to provide safeguards for your business:
* Try to avoid buying from China, unless it is from a trusted source, it's our experience that this is where a lot of the counterfeit components originate from. In many cases payment is requested in advance. It is extremely difficult to get your money back if you have paid up front and unfortunately you will be stuck with the worthless counterfeit goods.
* If you are not 100 per cent confident in your supplier, do not pay up front -- you might want to consider using letters of credit or services such as Escrow, where no money is exchanged until both parties involved are happy.
* Build and maintain strong relationships with current suppliers who you trust.
* Before trading with an unknown supplier, carry out additional checks such as trade and financial references. In many cases it's the seller that would normally carry out these checks, but buyers should also protect themselves by asking for references.
* Categorise suppliers from A to D. Deliveries, A being a known source with good trading history and D being a supplier who has either performed badly or is unknown. Goods coming in can then be processed more effectively. A list suppliers can be fast tracked through stores whilst poorly ranked suppliers are checked more stringently.
Some of the things to look out for include:
* A tube of components
with different dates codes
and batch numbers.
* A batch of components
that appear to be different
in colour.
* Any marking around the
trademark or serial code,
which may indicate that
the original markings have
been removed.
After going through these checks, if you are still nervous, walk away from the deal. It is not worth the risk."

Christos Papakyriacou is managing director of independent electronic distributor Alpha Micro Components, based in Basingstoke, Hampshire, UK. www. alphamicro.net