Avnet 2014 Annual Report Download - page 8

Major Products
One of Avnet’s competitive strengths is the breadth and quality of the suppliers whose products it distributes. IBM
products accounted for
approximately 13% , 12% and 11% of the Company’s consolidated sales during fiscal 2014 , 2013 and 2012
, respectively, and was the only
supplier from which sales of its products exceeded 10% of consolidated sales. Listed in the table below are the major product categories and the
Company’s approximate sales of each during the past three fiscal years:
Competition & Markets
The electronic components and computer products industries continue to be extremely competitive and are subject to rapid technological
advances. The Company’
s major competitors include Arrow Electronics, Inc., Future Electronics and World Peace Group, and, to a lesser extent,
Ingram Micro, Inc. and Tech Data Corp. There are also certain smaller, specialized competitors who generally focus on narrower regions,
markets, products or particular sectors. In addition, the Company may compete with its own suppliers that maintain a direct salesforce. As a
result of these factors, Avnet must remain competitive in its pricing of goods and services.
A key competitive factor in the electronic component and computer product distribution industry is the need to carry a sufficient amount of
inventory to meet customers’
rapid delivery requirements. To minimize its exposure related to valuation of inventory on hand, the majority of
the Company’s products are purchased pursuant to non-
exclusive distributor agreements, which typically provide certain protections for product
obsolescence and price erosion. These agreements are generally cancelable upon 30 to 180 days’
notice and, in most cases, provide for inventory
return privileges upon cancellation. In addition, the Company enhances its competitive position by offering a variety of value-
added services,
which entail the performance of services and/or processes tailored to individual customer specifications and business needs such as point of use
replenishment, testing, assembly, supply chain management and materials management. For the year ended June 28, 2014
, service sales
constituted less than 10% of the Company's total sales.
A competitive advantage is the size of the Company's supplier base. Because of the number of Avnet’
s suppliers, many customers can
simplify their procurement process and make all of their required purchases from Avnet, rather than purchasing from several different vendors.
Seasonality
Historically, Avnet’
s business has not been materially impacted by seasonality, with the exception of a relatively minor impact on
consolidated results from the growth in sales at the TS business during the December quarter primarily driven by the calendar year end selling
and buying patterns of key suppliers and customers, respectively.
Number of Employees
At June 28, 2014 , Avnet had approximately 19,000 employees.
Available Information
The Company files its annual report on Form 10-K, quarterly reports on Form 10-Q, current reports on Form 8-
K, proxy statements and
other documents with the U.S. Securities and Exchange Commission (“SEC”)
under the Securities Exchange Act of 1934. A copy of any
document the Company files with the SEC is available for review at the SEC’
s public reference room, 100 F Street, N.E., Washington, D.C.
20549. The public may obtain information on the public reference room by calling the SEC at 1-800-SEC-0330. The Company’
s SEC filings are
also available to the public on the SEC’s website at http://www.sec.gov and through the New York Stock Exchange (“NYSE”),
20 Broad Street,
New York, New York 10005, on which the Company
’s common stock is listed.
6
Years Ended
June 28,
2014
June 29,
2013
June 30,
2012
(Millions)
Semiconductors
$
13,160.9
$
13,720.8
$
13,461.6
Computer products
10,571.6
9,346.0
9,984.4
Connectors
794.7
687.6
667.5
Passives, electromechanical and other
2,972.5
1,704.5
1,594.0
$
27,499.7
$
25,458.9
$
25,707.5