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Season Group Explains Why It Acquired US-based EMS Headquarters
May 18, 2010 |Estimated reading time: 3 minutes
HONG KONG — Season Group acquired the assets of DC Electronics, a San Antonio, TX EMS provider, retaining all DC Electronics employees in Season Group USA. Season Group tells SMT why it added U.S.-based electronics assembly to its Asian and Canadian locations.
Why was U.S.-based PCB assembly an important acquisition for Season Group?
Being in the EMS business, it is imperative that we have fast response times to our customers, both in terms of general inquiries and also in delivery of finished goods. Our target customers are small/medium enterprises (SME), and for SMEs to compete against larger organizations, such as those in the Fortune 1000s, we must be able to help them launch products at a faster pace. This acquisition in San Antonio helps us do that, allowing us to work off the same time zone as our American customers, and also allows us to deliver prototypes within 24 hours if needed, which our Asian facilities could not do.
This acquisition also helps our SME customers compete better, as there are many cost advantages for proximity manufacturing. With logistics costs constantly going up, there are certain projects that do not make sense to take offshore, such as bulky equipment and machinery. We can produce subassemblies in our offshore locations, and then bring them to Texas for final assembly. This helps reduce the logistic costs and if done correctly, it can also qualify for “Made In USA” status. This is a very significant advantage for our customers, who with a “Made in USA” label can attract more customers, attain more tax rebates, and also approach government-related projects.
DC Electronics founder John DiPonzio and all of the EMS provider’s employees will be retained at Season Group USA. This is not always the strategy with an acquisition.
DC Electronics had a very strong employee base that we wanted to obtain. The previous owners had well over 80 years of experience combined in the electronics industry, which we cannot find in an offshore, Mexican, or other Latin America based company. Our offering to customers is not purely a piece price cost savings, but a total cost solution, which means that cheap labor cost is not the only criteria for our site selection. The key is a strong management and technical expertise.
Will the U.S. headquarters offer the same services as your Hong Kong, Malaysian, or Canadian sites?
In terms of service offerings, the U.S. facility will offer just printed circuit board assemblies and also final assemblies. Our China facility offers a completely vertically integrated service, which includes wire harness and cable assembly, PCBA, plastic injection molding, metal stamping, plastic thermoforming, and mold and die making. As mentioned above, San Antonio’s assembly operations can be supported with sub-assemblies from our offshore facilities. Our Canadian facilities can also provide SA with plastic injection molded parts.
We can now offer critical services such as new product introduction (NPI), prototype, quick-turn manufacturing as well as low to high volume manufacturing while addressing critical product lead times to our customers. Having a domestic USA site and global infrastructure will help our U.S. customers launch products more quickly and effectively. John DiPonzio, founder of DC Electronics, added that the buy allows their customers access to cost-competitive services without leaving the domestic EMS provider.
Season Group’s worldwide manufacturing space exceeds 700,000 square feet with over 1600 employees across China, Malaysia, Canada, and the U.S. The company sites are ISO:9001, TS16949 and ISO:13485 certified.
For more information, visit www.seasongroup.com
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