Risk of Supply Interruptions and Sharp Price Increases for Parts and Materials
First written in FY2018. 3 of 10 entries say "Worsened", first in FY2019-Q1. Latest entry: FY2026.
Towa moved to the "Worse" side of this theme in 2022, 1 year after the typical company in this theme (2021).
The whole theme swung hardest in 2021: 42 of 70 companies on the "Worse" side.
22 other companies' latest entry also says "Restated".
- FY2026RestatedAnnual report
「Our Group is securing appropriate inventory levels in line with order trends and taking measures such as procuring from multiple suppliers rather than relying on a single supplier, redesigning products to use alternative parts, and switching to in-house production.」
Measures to address procurement risks continue to include maintaining appropriate inventory levels, procuring from multiple suppliers, redesigning products to use alternative parts, and switching to in-house production. - FY2025MitigatedAnnual report
「Our Group is securing appropriate inventory levels in line with order trends and taking measures such as procuring from multiple suppliers rather than relying on a single supplier, redesigning products to use alternative parts, and switching to in-house production.」
As a response to supply risks, redesigning products to use alternative parts has been identified in addition to the existing measures of procuring from multiple suppliers and switching to in-house production. - FY2023-Q3MaterialisedAnnual report
「Although sales to China and Taiwan declined because customer factories were completed later as a result of parts shortages caused by the impact of COVID-19 and equipment installation was postponed because of logistics delays,」
Parts shortages and logistics delays actually delayed the completion of customer factories and equipment installation, contributing to the decline in sales to China and Taiwan. - FY2023-Q1WorsenedAnnual report
「Uncertainty continued, including the impact of lockdowns in China caused by the spread of variants, price increases resulting from global shortages of resources and parts and materials, and the prolonged Russia-Ukraine crisis.」
In addition to the previously identified risk of parts shortages, global increases in resource and parts and materials prices are described as an actual economic condition, while lockdowns in China and the prolonged Russia-Ukraine crisis are also factors contributing to uncertainty in the procurement and supply environment. - FY2022WorsenedAnnual report
「During the current consolidated fiscal year, the global economy showed signs of recovery as restrictions on activity were eased due to vaccinations, particularly in advanced economies. However, uncertainty over the outlook continued due to the impact of COVID-19 caused by the spread of variants, higher prices resulting from global shortages of resources and materials, and the impact on the global economy of the situation between Russia and Ukraine.」
The procurement environment is described as being affected by global shortages and price increases for resources and parts and materials, in addition to the previously identified risks of supply disruptions and shortages. - FY2022-Q2MaterialisedAnnual report
「In addition, although difficult procurement conditions due to a global shortage of parts and materials have continued, no significant delivery delays or other problems have occurred, and the impact on operating results is currently minor.」
A global shortage of parts and materials has actually resulted in difficult procurement conditions. At the same time, the company explains that no significant delivery delays or material impact on operating results have occurred. - FY2021MitigatedAnnual report
「Our Group is securing appropriate inventory levels in line with order trends and taking measures such as procuring from 2 suppliers rather than relying on a single supplier and switching to in-house production.」
Specific measures to address the risk of supply disruptions have been identified: maintaining appropriate inventory levels, procuring from 2 suppliers, and switching to in-house production. - FY2019RestatedAnnual report
「If suppliers are forced to suspend supplies of parts, materials or other items to our Group because of accidents, natural disasters, quality defects or other factors, or if supply shortages arise because of a sudden increase in product demand, our Group may be forced to restrict or suspend production activities.」
The risks of production restrictions or stoppages caused by supply disruptions, supply shortages, and sharp price increases for parts and materials continue to be described. - FY2019-Q1WorsenedAnnual report
「Semiconductor applications continue to expand with the full-scale adoption of AI and IoT (the Internet of Things) and the growth of high-capacity, high-speed communications ahead of the arrival of the fifth-generation mobile communications system (5G). However, concerns remain over slowing smartphone demand and a temporary slowdown caused by component shortages, requiring close attention to future market trends.」
The concern over temporary production and market stagnation caused by parts shortages has been explicitly identified, strengthening the uncertainty associated with the previously identified risks of supply disruptions and shortages. This does not state that a parts shortage has actually occurred. - FY2018First statedAnnual report
「If suppliers are forced to suspend supplies of parts, materials or other items to our Group because of accidents, natural disasters, quality defects or other factors, or if supply shortages arise because of a sudden increase in product demand, our Group may be forced to restrict or suspend production activities. In addition, if the market supply-demand balance for necessary parts and materials becomes severely distorted, their prices may surge.」
Procurement risks have been newly identified, including production restrictions or stoppages caused by supplier accidents, disasters or quality defects, supply shortages due to a sudden increase in demand, and sharp increases in materials prices.