While we continually manage the P8X32A inventory with a safety stock buffer, customer needs and supply chain changes can still put us in out-of-stock situations. Today we received a notification from the semiconductor foundry that a "massive increase in global semiconductor market" and a production line equipment issue will ultimately increase Parallax's lead time for wafers. The increase in lead time could amount to 45 days of additional time. Inventory planning may seem simple on the surface, always solved by "just getting a lot of chips in stock" to those who view this from the distance. That's not the best way to manage inventory. The variables in inventory planning include unknowns (orders), internal production needs for our products, lead times, yields, cash planning and safety stock. These details are generally handled through a system of simple calculations you can imagine, plus a set of human factors where we modify the results to include pieces of information that don't readily get accounted for in formulas. And it changes by the day - what we have today only applies to this moment in time. We have wafers coming in from prior purchases, too. If you are one of our more enthusiastic customers who monitors our on-line inventory real-time you'll be missing pieces needed to make an accurate guess of what's going on. Parts are usually in transit, in test, in packaging, etc. For example, I think we might have only 1,500 QFPs available for order today (it's a guess; I'm not even going to check) but the pipeline has another 21K units coming in.
If you want the bottom line, it's possible that sometime between February and April we could run low or out of stock on Propeller 1 chips for an unknown period of time. It's also possible we have NO gap in supply and this message will have no purpose.
If you use Propeller 1 chips in production, this is what ensures your supply during these times:
- Have your Purchasing Manager build a lead time of at least 60 days into your planning
- Place purchase orders now for future delivery needs; we fill in the order we receive unless there's a delivery date
Don't be a hoarder, either. This isn't a chance to make an extra buck :)
In times like this, we often receive a frantic inquiry like "are you not going to make Propeller 1s anymore?". Parallax depends on Propeller 1s for our business. Even if the foundry were to end the production line we'd still have several years of opportunity to buy lifetime supplies. You might notice that we still have SX chips from well over ten years ago, for example. There is no threat to the future of the Propeller 1.
This is my friendly message providing enough information to stay informed. Feel free to communicate with us about your concerns.