The world of lighting is in a state of flux with exciting market developments. It is coming to terms with LED technology and at the same time light fittings are being integrated into the fabric of increasingly intelligent buildings.
The electronic ballasts, drivers and controls used in a modern lighting system all need memory chips and other fundamental components such as resistors and capacitors.
But these essential components are in short supply after their manufacturers slashed output, shut factories, fired staff, put equipment purchases on hold or went out of business during the recession.
While demand for lighting equipment may have dropped from the highs of 2008, intelligent lighting fittings and controls represent a much larger proportion of the market. This has put increased pressure on component manufacturers at a time when other industries are also experiencing renewed growth.
Key component suppliers are taking a much more cautious view of the future and are not prepared to risk another boom and bust cycle. Instead, they are looking for sustainable growth before they make investments.
The semiconductor industry in particular needs plenty of capital to restart. It has been slow to respond to increased demand although less capital-intensive manufacturers are responding to the upswing.
The smaller manufacturers of components, particularly those in China, have gone out of business and this has significantly reduced the number of suppliers and sub-suppliers, putting stress on the supply chain.
Lighting’s place in the supply chain
Where do all these developments leave the lighting industry? The truth is that the lighting industry is a small player in the hierarchy of markets, way behind the telecoms, computer and other consumer electronics sectors, which have enjoyed renewed growth and demand for their products. They are, therefore, further up the supply chain pecking order.
Also, component and lighting wholesalers have been destocking over the past year or so. This has affected their ability to deliver products quickly because there are fewer products in the supply chain.
The situation is further complicated for lighting manufacturers who typically have short order visibility because installers and contractors are reluctant to place advance orders, preferring to leave it to the last minute before they order, and then expecting delivery in two to four weeks.
A further frustration is the late finalisation of exact product requirements. Dali or not, dimming or not. Delays can cause extra problems in delaying the logistics process to kick in.
The result is that delivery times for Dali ballasts can be as long as six months from time of order. Some manufacturers say they simply don’t know when the supply of components will resort to a more normal balance of supply and demand. It could be as long as 12 months.
Not only are component suppliers not always able to deliver at present, market forces are also pushing up prices at a time when prices for lighting products are under pressure.
The confusion this will cause on project completion will surely damage the reputation of lighting suppliers and the lighting industry as a whole – some already believe that lighting manufacturers are the poor relation when it comes to product delivery. It could even slow down the pace at which new technologies are adopted.
How can this be resolved?
Lighting manufacturers and suppliers already give realistic delivery times for their products, what is required is better co-operation from developers, specifiers and installers in the design and construction process.
There needs to be recognition that the humble light fitting is already an intelligent product, that its intelligence will only increase and that it needs to be treated intelligently throughout the supply chain, with due regard given to delivery times.
Everyone must accept that lighting is an important part of the overall building, and that it creates an opportunity to save energy and provide for a sustainable future when new technology is embraced.
There must be a willingness to listen to the lighting manufacturer and work with them to achieve both quality of light, efficiency of energy use, integration of intelligence and to meet the needs of the building.
Overall, simply place your orders early and reduce your expectations of a fast track order for lighting.