"Recovery" is the common expectation of all semiconductor industry practitioners for 2024. Many research institutions did indeed give a positive response at the beginning of the year, although everyone's predictions were different, there was a basic consensus on achieving double-digit growth.
Taking the World Semiconductor Trade Statistics Organization (WSTS) as an example, it predicts that the global semiconductor market will achieve approximately 13% growth in 2024.
"The term 'cyclical recovery' should be more in line with market changes in 2024, such as the global electric vehicle market's sustained surge or temporary slowdown, while at the same time,...", The rapid iteration of AI big models is reshaping the server market with unprecedented strength, and it is also awakening a new wave of demand in the smartphone and laptop fields. Alice, the general manager of Shenzhen Chuangshi Technology Co., Ltd. (hereinafter referred to as "Chuangshi Technology" or "Cytoch Systems"), a leading electronic component distributor in the industry, analyzed the deep driving forces behind this market recovery at the 2024 Wuhan International Electronic Components, Materials and Production Equipment Exhibition.
The Wuhan Electronics Exhibition, as one of the important windows for observing the changes in the semiconductor industry, is not only a brilliant stage for technological innovation and product competition, but also a barometer for predicting the future direction of the industry. For Chuangshi Technology, this exhibition not only means presenting the company's products and innovative solutions to the industry, but also provides a valuable opportunity for in-depth discussions with upstream and downstream on how to seize opportunities, lead trends, and drive innovation in the new market cycle.
Attending the Wuhan Electronic Exhibition for the first time, insight into trends and seizing opportunities are the internal driving force
With the advancement of a new round of technological revolution and industrial transformation, China is accelerating the digital and intelligent transformation of traditional industries. This not only improves production efficiency, but also promotes the development of new formats and models. The 2023 Central Economic Work Conference proposed to accelerate the formation of new productive forces and build a modern industrial system, which is not only an important task of economic work in 2024, but also a long-term task of cultivating new drivers of economic growth. Against this backdrop, the central and western regions of China are relying on their own resource advantages and regional characteristic industrial foundations to promote the agglomeration and development of local industries by building national strategic emerging industry clusters and advanced manufacturing industry clusters, such as electronic information and aviation.
It is reported that this is also the first time that Chuangshi Technology has participated in the Wuhan Electronic Exhibition. It is precisely because of the perception of the trend of China's industrial transformation and upgrading and the continuous rise of electronic clusters in the central and western regions that Chuangshi Technology's participation is driven by the desire to seize the direction of trends and opportunities. And this year's Wuhan Electronics Exhibition has indeed attracted professionals from various fields such as industrial electronics, automotive electronics, medical electronics, Internet of Things, communication, etc. More than 400 exhibitors have gathered in the exhibition area of 20000 square meters, attracting more than 20000 professional visitors to watch. "This exhibition can indeed help us gain a deeper understanding of the development trends of the electronics industry in the central and western regions, as well as across the country and globally, further expanding market opportunities, enhancing industry exchanges, and ultimately enhancing our brand awareness," Alice added.
How to seize distribution opportunities when AI empowers growth in multiple industries?
Although recovering from a downturn, the semiconductor distribution market in 2024 still faces both challenges and opportunities, such as supply chain fluctuations. Due to the cyclical nature of the semiconductor industry, the distribution market in 2024 may continue to experience supply and demand fluctuations, Alice said, "Since 2024, customers and semiconductor supply chains have continuously reduced inventory, achieving significant results. However, due to the impact of economic instability, the market is experiencing scattered material shortages. At the same time, in recent times, the source end, such as raw materials and processing costs, has begun to show an upward trend, and there may be shortages in certain specific areas in the future."
For example, the increase in market concentration: due to the possibility of further increase in the concentration of the electronic component distribution market, large distributors can expand their market share through mergers and acquisitions, forming a pattern of "the strong always remain strong"; For example, geopolitical influences: political factors such as economic strategic games and export controls may affect the global layout of the semiconductor industry, thereby affecting the supply chain and business models of the distribution market; For example, technology driven growth in demand for AI and high-performance computing will drive innovation in the semiconductor industry, bringing new growth opportunities to the distribution market
The rapid development of large models and generative artificial intelligence technology is profoundly influencing various industries, from automobiles and consumer electronics to healthcare, industrial control, and more, all of which demonstrate a strong demand for AI intelligence integration. This trend, in turn, further drives the development of the communication market. In the semiconductor market, the iterative development of AI cannot be separated from the collection, calculation, training, and transmission needs of massive data, which will further promote the iterative upgrading of computing power and networks, and drive the various chips widely used in AI data centers and edge high-speed computing, such as CPUs GPU, FPGA, ASIC, HBM memory, 3D NAND DDR5, "Ethernet PHY chips, power management chips, and so on will all be opportunities for innovative technology," Alice emphasized. "The key is how to seize them!"
Keeping up with market changes, Chuangshi Technology is actively expanding its agency lines, such as Renesas, Reneng, and Shengbang Micro. We hope to expand our cooperation opportunities in fields such as communication, industrial control, and medical electronics, which are first empowered by AI, while also bringing more innovation, efficiency, and value to corresponding industries.
How can self transformation stand out in the current distribution transformation?
"Technological distribution capability" has become a more deterministic path. It is reported that Chuangshi Technology no longer emphasizes itself as an independent distributor. "The current ever-changing market environment requires us to build ourselves into a comprehensive service platform that integrates electronic component distribution, technology chain services, supply chain coordination and supporting services, and data services for component application innovation and modern supply chain," Alice emphasized.
For Chuangshi Technology, the improvement and manifestation of comprehensive service capabilities urgently need to be made known to the industry through multiple windows. While continuously enriching its agency lines, Chuangshi Technology has also added a solution design business supported by the original factory since April this year. In the current situation where the distribution business lacks stability, expanding the agent line while carrying out Design In services can further stabilize the relationship with the original factory and obtain active support.
The principle of Chuangshi Technology has always been to focus on customers and empower them in all aspects. On the occasion of participating in the 2024 Wuhan Electronic Exhibition, it further showcases to the industry its continuous iteration and self innovation in operating models over the years.
Starting from the initial simple distribution business, Chuangshi Technology has been involved in testing services since 2022. Adhering to the commitment of "quality is the lifeline", it has set up three testing laboratories in Hong Kong and Shenzhen, strictly following AS6081, AS6171, According to international testing standards such as IDEA-STD-1010-B, we have successfully passed relevant certifications and can provide customers with coverage packaging inspection, appearance inspection, and more X-ray detection A complete range of testing services, including XRF testing, electrical testing, solderability testing, and open cover testing.
In 2022, Chuangshi Technology added a domestic agency line, and with the increasing richness of international and domestic agency lines, a new solution design business section was added in April this year, dedicated to providing personalized solutions for customers. In the process of continuously expanding local brand channels and distribution channels, we will further improve the product quality, service level, and customer experience of Chuangshi Technology, in order to achieve sustainable development of the company and co create value with customers.
In addition, as an electronic distributor based in Asia and radiating globally, the implementation of globalization strategy is also of utmost importance for Chuangshi Technology to respond to market changes. Against the backdrop of adhering to a dual focus on domestic and foreign markets, Chuangshi Technology hopes to expand its business to markets such as East Asia and Southeast Asia. It plans to establish offices in multiple countries or regions around the world in the future, in order to provide comprehensive services and support closer to local customers and strengthen its global operation and service capabilities.