Distributors Reach Out to Warn Customers on Lead Times for Some Lighting Fixtures

July 23, 2010
Some days, it’s rough out there for the middleman. Electrical distributors have recently found themselves caught between customers pushing to fast-track long-awaited construction projects

Some days, it’s rough out there for the middleman. Electrical distributors have recently found themselves caught between customers pushing to fast-track long-awaited construction projects and lighting manufacturers forced to stretch out lead times on fixtures due to a widespread shortage of electronic ballasts.

According to distributors, the shortage started to affect shipments in May or June, and seems primarily to affect linear rapid-start electronic ballasts. Manufacturers seem to be affected to varying degrees, and none are eager to talk about it for fear of losing orders.

The impact has fallen harder on large project business, distributors said. Manufacturers seem to have enough product to fill into-stock orders, but quotes on fixtures specified for large construction projects have become a major headache, with delivery times stretching out by 50 percent or even doubling. Distributors said some manufacturers have suspended their “quick-ship” programs due to uncertainties about whether they’ll be able to meet demand.

The manufacturers have been mostly silent on the shortage, so many distributors have taken the lead, doing all they can to get the word out to electrical and general contractors that, even on fixtures that usually are available on short notice, purchase orders should be released as early as possible, and that it might be necessary to consider alternative technologies.

ConneXion, an electrical distributor in Chicago, has been posting updates and responses from their manufacturers on the ConneXion website (www.connexion.com) and online discussion boards such as renewableenergyworld.com.

“We want to be viewed as a resource for accurate, credible information. We feel like if we’re not communicating with our customer, they’re going to be upset when an issue comes up,” said David Rosenstein, president of ConneXion. “We want to give them an awareness so that they will be thinking ahead, so they’re not waiting for the last minute to do something.”

The ballast shortage appears to be related to a global shortage in supply of certain electronic components used not just in ballasts but also flat-panel video screens and smart phone displays. The manufacturers of a certain type of capacitors were hard-hit by the recession, which forced some out of business and left the remaining producers with insufficient capacity to satisfy resurgent demand. These companies supply their A-list customers first — major manufacturers of consumer electronics and telecommunications equipment — leaving fewer of the components for smaller customers such as the makers of electronic lighting ballasts.

Bill Donohue, president of Crown Supply in Providence, R.I., said the first he heard of the ballast shortage was back in May, from a local lighting rep, and he first saw its effects a few weeks later. “In June we ran across the issue with job where they needed to make a change that typically wouldn’t have made much difference — it was just a change in the lamp type — but when we went to order the fixtures they told us they were six weeks out because of the ballasts. It threw the whole schedule off.”

Crown Supply began to include notes in customer newsletters and billing statements letting them know of the lengthening lead times.

The communication coming from distributors contrasts with the communication — or lack of it — that they’re getting from their manufacturers, which has many distributors frustrated. “They all saw it coming and didn’t tell us about it,” says Kyle Hanson, who leads the lighting group for ConneXion. “We’ve got orders in, and knowing we have the problem we’re being proactive, making sure that the dates are still good. They tell us, ‘yes, yes yes,’ until the day it’s supposed to ship, then they tell us they’re out four more weeks. It’s as if the manufacturers are lying to us to keep the order — they tell you want you want to hear — then the contractor wants to back-charge you for liquidated damages and the overtime it takes to catch up.”

Distributors are doing what they can to bring in extra stock, but on large spec projects that’s not always possible. “What we’re doing is trying to consolidate our purchases with the factories that have best shot at hitting the dates,” said Rosenstein. “We’re expediting our submittal processes so we can order faster, then trying to speed-up negotiations on purchase and get commit letters from the factories to hit the date, so at that point we’ve done everything we can up-front, versus chasing it after the fact.”