It's buyer beware when shopping for electronics in Shenzhen's Huaqiangbei district.
My first blog from my China trip was about a new business model that's emerging in electronics based on crowd funding and agile manufacturing in Shenzhen. During my meeting at Seeed Studio, I asked the founder Eric Pan about his supply chain and where he purchases components. As I predicted, the top two sources for parts are DigiKey and Mouser, no surprise there, but his third source was, as he calls it, the "market"--meaning the legendary Huaqiangbei district in Shenzhen. Even Seeed, which is based in Shenzhen and has a dedicated supply chain team, is not immune from shortages and counterfeits. Eric told me that recently they were victim to counterfeit substandard components purchased at Huaqiangbei, which begs the question "why would the supplier knowingly do this?" The supplier is not going to get any further business from Seeed and has damaged whatever reputation it had. The answer is complex and ranges from the complete lack of trust in China to the extremely short-term thinking many companies exhibit. I will look at the trust crisis in depth my next China blog. Clearly I had to see Huaqiangbei, so I made plans to go there the next day with Mike Zhang, an analyst with from EETimes China.
Huaqiangbei is more than what westerners may think of as a market. It's more of a district or neighborhood consisting of multistory buildings packed tight with tiny stalls and in early June, it's hot! Each building has a focus, so there are buildings for video, mobile phones, computers, and of course, components. Entering one of the components buildings was complete sensory overload, the heat, noise and sheer number of people inside is overwhelming.
Atmel in-house distribution, Huaqiangbei. (Photo: David Blaza)
Cables to order. (Photo: David Blaza)