The challenge
This phenomenon is well known throughout the industry: While key components are typically purchased from a small number of major distributors, the bulk of C-parts, specialty components, and electromechanical components is spread across a vast array of niche suppliers (the so-called “long tail”). However, every single vendor number in the system entails recurring administrative work: master data maintenance, negotiations, order confirmations, shipment tracking, invoice verification, and quality audits. The internal effort required to process an order often exceeds the actual value of the ordered components.
Risks for Businesses
Anyone who allows their supplier base to grow unchecked is accepting hidden risks and inefficiencies that gradually erode their margins:
Skyrocketing Litigation Costs (Total Costs)
Every additional supplier results in measurable administrative overhead costs. From ordering to accounting, the process often costs three-digit amounts per transaction—regardless of whether components worth 50 euros or 5,000 euros are ordered.
Resources Blocked in Purchasing
Strategic buyers spend valuable work time managing hundreds of small suppliers on an operational level, rather than focusing on strategic price negotiations and risk analyses.
Loss of economies of scale
Those who spread their purchasing volume across countless sources forfeit valuable economies of scale and lose bargaining power with individual manufacturers or suppliers.
Logistical Chaos in the Receiving Department
Dozens of individual deliveries per day put a strain on logistics. Different packaging standards, inconsistent labeling, and inadequate quality controls by small suppliers increase the risk of errors during goods receipt.
RTS electronic’s Solution Approach
As a specialized distributor and logistics service provider for electronic and electromechanical components, RTS electronic GmbH in Waltrop serves as your central consolidation partner. We consolidate your supplier base without requiring you to sacrifice flexibility or technical expertise:
A partner for your entire product portfolio: Whether active semiconductors, passive components, or complex electromechanical systems—thanks to our broad market coverage and technical expertise, we manage individual part numbers just as reliably as we source complete assembly projects through a single vendor account.
Manufacturer-Independent Sourcing: Unlike franchise distributors, we are not bound by any rigid product lineups. Since 1997, we have had access to over 2,000 manufacturers worldwide. This allows us to consolidate your orders from hundreds of sources at RTS electronic and reliably deliver them to your locations worldwide—all at a uniform, global price.
Dramatic reduction in process costs: Hundreds of orders, delivery notes, and invoices are transformed into a clear, structured procurement process. This noticeably lowers your overall purchasing costs from day one.
Customized Logistics & Inventory Management Solutions: We not only reduce the number of your suppliers but also optimize your logistics at the same time. Through customized framework agreements, rolling forecasts, and strategic safety stock, we reliably safeguard your production at consistently predictable prices.
Integrated Quality & Incoming Goods Inspection: You transfer the quality risk associated with small suppliers directly to us. Every component undergoes our rigorous quality management process, including proper ESD packaging, moisture protection (MSD), and seamless digital tracking via the incoming goods scanner (WES V5) and the outgoing goods scanner (Packtrace) from Modi.
In practice
The situation: A European top-10 EMS provider faced the challenge of sourcing a vast variety of components for its international manufacturing sites. Managing hundreds of individual suppliers simultaneously, dealing with varying delivery terms, and dealing with incomplete labeling at goods receipt created an enormous administrative burden and slowed down the logistics processes of the entire corporate group.
Strategic Planning: As a strategic consolidation partner, RTS electronic has been handling all sourcing and logistics management for over 20 years for more than 300 manufacturers and a portfolio of over 5,000 different components—ranging from high-volume standard components to complex, custom-designed components. To eliminate manual interfaces, the EMS service provider was connected directly to RTS via EDI (Electronic Data Interchange). In addition, contractually defined framework conditions for global delivery to the sites were established, and a customized, client-specific labeling system was introduced. This is just one example of the process optimizations implemented to sustainably reduce the workload on the EMS service provider.
The result in practice: Switching to RTS electronic as the central partner immediately reduced the complexity of the purchasing process. Ordering, confirmation, and delivery processes now run automatically and error-free via the EDI connection. Shipments arrive at the customer’s global locations already labeled with the customer’s internal material numbers and barcodes, which drastically speeds up the check-in process at goods receiving. At the same time, global delivery is secured and facilitated by globally standardized, contractually guaranteed terms and conditions.
FAQ – Frequently asked questions
How does supplier consolidation specifically affect the total cost of ownership (TCO)?
Won't our company lose flexibility if we consolidate many suppliers through RTS electronic?
Can RTS electronic also reliably source custom electromechanical components?
Put an End to Uncontrolled Supplier Growth: Streamlined Processes for Your Purchasing Department!!
Relieve your purchasing department of unnecessary administrative work and reduce your process costs in the long term. RTS electronic is your vendor-neutral partner for efficient and future-proof supplier consolidation.
Your direct contact information: +49 (0) 2309 95 17 0
Email address for your bills of materials and inquiries: info@rts-electronic.de
