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The impact of the global chipset shortage on technology procurement.


Throughout 2021, industries across the globe have been negatively impacted by a shortage of vital chipsets, and the shortage shows no sign of slowing down anytime soon. Kira Hartig, Internal Account Manager at BroadVision Technologies | Solutions | Enterprises, talks us through the impact that the global chipset shortage has had on the technology industry and procurement today.

The severity of the 2021 chipset shortage must not be underestimated. “Almost everything electric you own contains a chipset, from your phone to your computer to your car. Chipsets can be found in everyday items and these semiconductors, the “brain” of every electronic device are now in short supply.” shares Hartig.

Hartig explains, that the COVID-19 pandemic caused factories to halt operations due to lockdowns put in place, disrupting the supply chain for months. This coupled with the increased demand for mobile devices as more people were forced to work from home and remote added increased pressure for the supply chain. The backlog caused by the disruption in the supply chain has made a massive impact with long lasting effects.

How does this affect South Africa? According to Hartig,  most of the major tech brands brought into South Africa are imported. This has had a negative impact on the South African tech market, as orders are constantly being delayed due to the uncertainty of the chipset shortage and concerns on when the backlog will come to an end.

“Notebooks for example are a very fast-moving commodity, and it is very difficult to secure stock. The turnaround time from quote to order needs to be same day if not quicker.” She explains.

Opinions on when the chipset shortage will end vary, some predicting it may continue until early 2023. Intel CEO Patrick Gelsinger said the shortage could last two more years and IBM’s CEO, Arvind Krishna, offers the most pessimistic forecast, saying the shortages could last well into 2024.

The impact of the shortage will have long lasting effects, price hikes and project planning just two of the areas being negatively impacted due to the high demand/low availability of these commodities. Even company standards are difficult to follow at times as you need to consider what is in stock and deviate from your usual standard specifications or wait on ETA’s going from weeks to months.

“At BroadVision we strive to keep our customers abreast of the situation and use all means at our disposal to secure stock as quickly as possible. We have partnered with key suppliers that have the same business ethics as we do, where customer service is top priority.” she concludes.