According to the DigiTimes who cover the technology market in Taiwan the average lifecycle of new consumer electronics products such as tablets, smartphones and notebooks, has shrunk from six months to three months during the past 12 months as manufacturers crank up new models one after another.
According to sources from the upstream supply chain the turnover of new products is mainly due to the frequent changes in consumer purchasing habits as fierce competition among vendors is providing consumers with more choice.
As a result of the shortening lifecycle vendors such as Samsung, LG, Sony and several smartphone manufacturers are now placing short-term orders to their upstream suppliers instead of signing long-term contract as in the past.
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Some brand vendors, which used to outsource most of their component orders to 1-2 major suppliers to save costs, are also starting to reevaluate their strategies as they look for cost savings due to constant margin erosion claims the DigiTimes Research Group.
