Top Procurement Headlines from 2024

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The end of the year is always a good time to reflect on what took place over the last 12 months, what’s happening now and how these trends may impact what’s coming next in 2025. A lot went on in the ever-evolving procurement space in 2024, and the electronics sector was particularly active. 

Nearshoring and onshoring trends made a lot of headlines as U.S. organizations assessed their supply chains and looked for ways to bring sourcing and/or production closer to home. Some of this was already happening in the aftermath of the global COVID-19 pandemic, but the incoming presidential administration’s promises of higher import tariffs ramped things up a bit on that front. 

While the final tariffs could change before the President-elect takes office, Donald Trump said he would implement a 25% tariff on all products imported from Canada and Mexico. The new administration would also add an additional 10% to existing tariffs on imports from China, Silicon Expert reports.

In “The Rise of Nearshoring in Electronics Manufacturing,” Misha Govshteyn writes about the “strategic shift” to nearshoring, noting that the shift is being driven by the compelling advantages of proximity, including more effective communication, enhanced supply chain visibility and greater quality control.  

“For decades, offshoring has been the go-to strategy for companies looking to cut costs in manufacturing,” Govshteyn writes. “The lure of cheap labor and favorable production environments in China and Southeast Asia has been undeniable.”

Choosing to nearshore is not merely about being close on the map, he points out. It also means sharing time zones, cultural similarities and better communication, which all work together to facilitate smoother teamwork and faster decision-making.  

“As U.S. companies adopt nearshoring for their manufacturing operations, it is not just a quick decision,” Govshteyn adds, “it is a carefully planned move to make supply chains stronger, reduce risks, and build a solid foundation for long-term growth.”

AI Comes into Clearer Focus

As technology continues to make its way into more procurement departments, artificial intelligence (AI) is revolutionizing not only the future of technology and the electronics industry but also the way procurement professionals conduct their work. 

“Currently, much of a procurement specialist’s job is manual. While some automated tools exist, tasks like supplier selection, risk management, negotiations, inventory control, and forecasting can be time-consuming, prone to human error, and dependent on personal experience,” Mouser Electronics explains in “How AI is Revolutionizing Procurement in the Electronics Industry.”

 “Additionally, analyzing market trends and managing supplier relationships leave little room for other activities.

For example, AI can automate routine tasks, allowing procurement specialists more time to focus on supplier relationship management, strategic sourcing and overall business strategy.  

AI tools can also facilitate refined risk management strategies and ethical sourcing practices. “The technology can help assess supplier risk, monitor compliance with sustainability and ethical standards,” Mouser points out, “and execute responsible sourcing strategies.”

Conflict Minerals Persist in the Electronics Supply Chain

Despite government efforts to reduce the use of conflict minerals in electronics manufacturing, a 2024 report from the U.S. Government Accountability Office (GAO) reveals that peace and security hasn’t improved in the DRC as a result of the SEC disclosure rule. 

“SEC’s rule requiring the disclosures hasn’t reduced violence,” the GAO says in its report. “Armed groups continue to fight for control of gold mines in the country’s eastern region. This is partly because gold is harder to trace and easier to smuggle than the other minerals.”

Among the report’s key findings were the fact that there’s no evidence that the rule has decreased the occurrence or level of violence in the eastern DRC, where many mines and armed groups are located; the number of violent events in the adjoining countries did not change in response to the SEC rule; and the number of companies filing conflict minerals disclosures in 2023 increased for the first time since 2014, but many of them continued to report being “unable to determine” their minerals’ origins. 

Some of the responsibility lies with the mining companies themselves. In “Conflict Minerals: Navigating Ethical Sourcing Challenges,” Sean Ashcroft discusses the sector’s need to “navigate regulations while also maintaining profitability and meeting market demands.” This often requires significant investment in supply chain transparency and traceability technologies.

“Companies are increasingly mapping their supply chains to identify potential sources of conflict minerals, often tracing materials back through multiple tiers of suppliers,” Ashcroft writes. “Some mining companies have implemented blockchain technology to enhance traceability. This allows for the creation of an immutable record of a mineral’s journey from mine to end-user, providing greater assurance of responsible sourcing.”