Chinese New Year: How to avoid LCD shipment delays

2016 Chinese New Year Feb 8th – 22nd


Happy Chinese New Year from custom LCD supplier: Focus Display Solutions

That’s right; it is almost Chinese New Year (CNY). The year of the Fire Monkey. For any USA and Canadian companies that require components manufactured in China and Taiwan, this is a big deal. As a supplier of both standard and custom LCD modules, Focus Displays has learned the hard way the wisdom of planning ahead to avoid LCD shipment delays created by this holiday.

8 reasons for long lead-times of LCDs due to CNY

1. Pre-holiday production slowdown

Challenge: Production of LCD modules begins to slow down before the start of the holiday as people leave early to beat the rush and avoid congestion.

Solution: Place your prototype (sample) orders for customized LCDs no later than September.

2. Delays in employees returning from their holiday

Challenge: There is a delay of several days required for the workers to return back from their cross-country trip after visiting their families. Their return journey can take several days (sometime weeks) due to the fact that several million people are traveling at the same time, over-taxing the same railways and roads which results in overloaded transportation structures.

I watched a documentary once on the exodus of people to and from their homes every year. The same delays would occur in the US if everyone saved up their travel for the same two week period. Our system would be stretched beyond its ability. It was common for people in China to wait at the train station for days before room would be available for them.

Solution: Order your production LCD displays from FocusLCDs before mid-October to avoid LCD shipment delays. We will stock your inventory for a few months until you need them.

3. Many employees do not return to their old jobs

Challenge: Many of the workers do not return to the job they left, but instead return to find a higher paying job. You can’t blame them for switching. Some estimates suggest that as many as 50% of the employees will not return back to their previous job.

Solution: Ask Focus Displays about a Kanban system, where we keep a preset amount of your inventory at all times. This will be kept in Chandler where deliveries can be made in one day to your location.

4. Down time due to training of new employees

Challenge: The number of non-returning employees is so high that one of the first tasks a manufacture has to perform is the hiring and training of new employees. This pulls their experienced employees away from the manufacturing to invest in teaching the new employees and may lead to quality issues until the new employees are fully up to speed.

Solution: Make sure your LCD supplier has a QA (Quality Assurance) process in place to confirm the quality of LCDs that are manufactured. This is critical the first few weeks after Chinese New Year and will help to avoid LCD shipment delays.

5. Labor Shortage in China

Challenge: Currently there is a labor shortage in China (1) which means that there are many more job openings than there are workers to fill them. This makes it easy for people to hop from job to job for a small pay raise. When this happens factories need to find new employees and these new employees need to be trained, all of which create delays in your LCDs.

Solution: Make sure your LCD supplier places orders many weeks before the product is due. Then if there is a delay, you still receive your product when you need it. If you’re current LCD manufacture will not hold safety stock for you. Contact Focus Displays at 480-503-4295. We have lots of room in our warehouse. We will do everything we can to avoid LCD shipment delays.

6. Understaffed customs office

Challenge: China’s Customs office is understaffed during the holiday and even when they return, there is a huge amount of backlog that needs to be processed. Every TV, toaster oven, chair and LCD that is manufactured in China must pass through the customs process, this can take anywhere from a few hours to several days. The weeks after the return from Chinese New Year’s is when the backlog for customs is at its height. Not only does Customs need to catch up, but they are also short-staffed and need to interface with shippers that are returning back to work. Once again, it takes several weeks before the manufacturing and delivery systems are back up to full speed.

Solution: Make sure your LCD supplier has a good Customs clearing house in place that is ready for the backlog that will hit. This will go a long way in avoiding LCD shipment delays.

7. Congestion at the port

Challenge: Once the holiday is over and products are ready to ship, the next bottleneck moves to the ports. A LCD supplier may need to wait several weeks before they have enough LCDs to ship a pallet full. Then, once they have enough displays, they must wait in line until there is room on the ship. Then there is a 1-2 week window for the cargo to cross the ocean. Finally, the boat has to dock in Long Beach or somewhere along the coast and has to be unloaded and broken apart before a single prototype sample order is released to the customer.

Solution: FocusLCDs does not ship any LCD module via boat. All displays, samples and production, are shipped via FedEx air and are available to our customers in an estimated 72 hours or less after the display clears QA. This is the case no matter if we are shipping only one box or one hundred boxes. This action saves many days, even weeks, and avoids LCD shipment delays.

8. Backlog of ‘RUSH’ orders placed during the ten day shut down

Challenge: The days before the holiday shut down, is much like the days before Christmas where people are rushing for last minute gifts and specials. Many companies in the US, Canada, and Europe realize they need inventory in March and then place a last minute RUSH order to China. This only builds the backlog and adds up to additional delays.

Solution: FocusLCDs places orders for our standard displays such as TFT (2), Character and Graphic displays in late September and early October to avoid LCD shipment delays. We recommend you plan ahead now.

We don’t believe in pressuring our customers, but we do ‘remind’ them that we need their POs by the second week of October. All of these factors can combine to create the ‘perfect storm.’

How to avoid LCD shipment delays

Place your LCD Display orders no later than the second week of October to safely make a February delivery. Once the CNY holiday starts, there is no ‘expedite’ fee that will speed things up. You will need to get in line with others for your product to be completed. We’ve outlined several things in this article to look out for and provided a few solutions which will help you in avoiding any LCD shipment delays during the Chinese New Year.

Is Chinese New Year’s always on the same days?

No, unlike Christmas (25 December), Boxing Day (26 December) or New Year’s (1 January), the dates for CNY change every year. This year’s holiday will start on Monday, February 8, 2016 and ends with the Lantern Festival February 22nd.

Focus Display Solutions is located in Chandler Arizona. We design and supply both customized LCD modules and off-the-shelf standard displays. We make every effort to hold our customer’s inventory in our Arizona warehouse location, because nothing is worse than a customer’s production line coming to a stop because LCD orders were not placed in time.

Many of our standard products can be located on our website and also on our distributor’s website: Allied Electronics (http://www.alliedelec.com/focus-display-solutions/)

Lead times

The lead times of LCD displays is growing longer. There are several reasons for this, but Focus Displays is able to help. We will bring in your inventory before you need it and hold on to it until you need us to ship it. That means you could have your LCDs the next day after you contact us for a release.

Below is a quick break down of our display lead-times

For LCD orders placed between October and March:

  • Prototypes (samples) is eight to eleven weeks
  • Production quantities is nine to thirteen weeks

For LCD orders placed between April and September:

  • Prototypes (samples) is six to eight weeks
  • Production quantities is seven to nine weeks

Christmas vs: Chinese New Years

So what is the connection between the New Year’s holiday we celebrate in the USA and Chinese New Year? In the United States and Canada we celebrate Christmas, Boxing day (Canada) and New Year’s within the same week. This is a time when most manufacturing in North America slows down or comes to a complete stop. When those holidays are over, we jump back into our jobs and within a day or two production is back in full swing.

This is not true with Chinese New Year. In China, the official holiday lasts for a minimum of ten days. But manufacturing is non-existent, or greatly reduced for more than those ten days. We recommend planning for a month’s delay. Below are more details on why the delay lasts so long and solutions on how to avoid LCD shipment delays.

MOQs for displays are increasing

MOQs (Minimum Order Quantities) for all LCD technologies are increasing. An example of this is custom segment LCDs. In the past, the MOQ was 500, then it went to 1K and soon we expect it to reach 1.5K.

The MOQ for OLEDs has really jumped. This is mainly due to the demand of consumer goods as Christmas draws close. If possible, we recommend you select a TFT display instead of an OLED. We carry these in stock and can ship the same day you contact us.

Focus Displays specializes in the design of custom LCD modules and the holding of inventory for standard LCDs.

Do you need a LCD for your new design? Then contact Focus Display Solutions now.