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The I-Connect007 editors recently sat down with Dan Schoenfelder, vice president of business development at Octopart. We discussed online parts libraries and the impact they can have on choosing parts based on availability data during the design process.
Nolan Johnson: Dan, could you give us an overview of what you and your teams do at Octopart?
Dan Schoenfelder: I run the business and operations teams at Octopart. We’re a small team of about 20 headquartered in Manhattan—the Flatiron District—and that’s pretty much where all of our staffers are. We are a search engine for electronic components, and our biggest goal when it comes to what we’re trying to accomplish is to democratize information for those in our industry who need it whether it’s designers, engineers, buyers, etc. Octopart itself is a very widely used platform. We have more than 900,000 unique visitors per month who visit our site and search for products. We receive more than 2 million searches per month for electronic components. We find that our audience is geared toward being more technically focused resources, so we see ourselves on the front end of that design experience for a lot of electronic assemblies.
We are owned by a company called Altium, whose primary product is ECAD tools for circuit board design, and their flagship product is Altium Designer. We’ve been a part of the Altium family for about three years now.
Johnson: That’s a great overview. Dan, one of the things about Octopart is you built a pretty unique spot in the supply chain. It’s emerging and disruptive. You have a different perspective doing what you do, standing between designers as they design and make decisions about their components in the CAD tool environment, and then having that conversation with manufacturers and distributors. Can you talk about that experience?
Schoenfelder: First, just touching on that something you mentioned, we’re in an emerging space in this industry. To give you an example, some of the most recent numbers that I’ve seen indicate the semiconductor industry was up 17% year after year when comparing July of 2017 to 2018. Octopart is outpacing industry growth by more than two times. From what we’re seeing, our site traffic and activity and the number of searches is increasing by more than 40% each year. In some ways, our business is benefiting from what is a good time in the electronic component industry when it comes to sales. At the same time, I think we’re outpacing that significantly as well. It speaks to the desire of buyers and engineering professionals to have more readily accessible information.
We do find ourselves in an interesting position, and one of the value propositions of Octopart is that there’s no barrier to entry for our user community, meaning that you don’t have to provide any identifying information to get access to data. The data that we have on our site includes technical specifications for devices, data sheets, downloadable CAD models, and simple things for comparison like price and availability. We have over 250 distributors and manufacturers that participate and list inventory through Octopart. We put a compelling amount of information out there that can be used at various stages in the product lifecycle of a design.
Andy Shaughnessy: Dan, when you talk to designers, what are some of the biggest challenges that they come to you with? What are their bottlenecks as far as components?
Schoenfelder: There are several areas where Octopart provides value there. I think that designers want to know a handful of things. Typically, if you were to survey our user community when they’re looking for devices and something to put in the design, we tend to have two elements of searches here. There’s a search that occurs when somebody knows the particular device that they’re looking for. In those cases, what folks are looking for is, “Can I get it? How soon can I get it? And how much does it cost?” When that part is already defined inside their organization, it’s on their ABL or is an approved device in a design.
Then, there’s the part search and discovery piece, which is people who come to Octopart looking for something where they may not know the part number or manufacturer, or they may just know the function of the device. They’re doing more product research. We have two different classifications of search. And again, for those who know what they’re looking for, they’re coming to us to see, “Can I get it? Is it widely available, and therefore, safe and low risk for use in my design? How quickly can I get it?” And what does pricing look like for those devices?” What we find is that’s the more straightforward side of the search for us.
The more challenging thing is we’re trying to expand our capabilities to support folks searching for devices that don’t know exactly what they’re looking for. They might not have a part number, don’t know the manufacturer, or may just have the function of the device. In those types of engagements and users, they may be looking for things like data sheets or specifications on the site. Or they may be looking to download CAD models because they don’t have them available on their existing libraries as well. We have a wide variety of use cases, and it’s hard to pin down our user community into having just a single-use case for Octopart.
Patty Goldman: We keep hearing about the shortages of components and the long lead times. How does that figure into the number of searches that you’ve been seeing lately?
Schoenfelder: I think there’s no question that constraints across various components contribute to the number of searches that we see on Octopart. And certain product categories have a density of search that’s far greater than others. Certainly, there are passive devices right now that are in high demand and have scarcity, and we see that. I don’t want to overstate the relevance of the information and data that we have at Octopart, but I do believe that we have our finger on the pulse of activity in the industry. With our data, we’re trying to use that to help our search experience, and people find what they’re looking for more readily based on the volume of searches we’re seeing and the types of commodities that are being searched. So, we are seeing an uptick in activity overall, and spikes inside of specific commodities that are constrained.
Stephen Las Marias: We’re seeing that designers have to make obsolete some of the components that they are designing into the circuits and products that they’re doing because of obsolescence issues when it comes to applications. The product would have to work for longer, for 10–15 years. From your perspective, how does this impact the industry?
Schoenfelder: I would say that if there is a specific area where there’s deficient information in our industry, it’s around obsolescence of products. There’s not any one reliable place to get information across several product and commodity categories. And the information that is out there is often not accurate if you talk to specific manufacturers about their plans for the end of life in products and/or discontinuance. It’s hard to find any resource out there that is extremely good at either identifying or predicting obsolescence.
There’s no question that contributes to activity on Octopart. That is a piece of this scarcity that we just referenced, but obsolescence is a piece of that too. There’s no question that one of the big value props of Octopart is the aggregation of information. When times of scarcity come, we are a place where consumers of products can determine if there’s availability in the marketplace across hundreds of distributors around the globe. That is certainly one of the good use cases for Octopart. When there are times where a device is constrained, users will flock to Octopart to see what inventory exists and how they can secure that inventory for their products.
To read the full version of this interview which originally appeared on the January 2019 issue of SMT007 Magazine, click here.