Establishing a Solid Manufacturer Relationship

Today we have a fascinating conversation about PCB manufacturing, reshoring, testing, and much more with Cody Endlich, Head of Strategic Sourcing at MacroFab. He and Tech Consultant Zach Peterson discuss the latest trends in manufacturing, procurement, and supplier dynamics. This is a wonderful convo for anyone interested in the future of PCB sourcing and manufacturing.

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Show Highlights:

• Cody's Background
• Internalizing the Broker Process
• What's Different about MacroFab
• Where Are MacroFab's Partners?
• Reshoring Efforts
• Copycats?
• The Sourcing PictureHow MacroFab Tests
• Bringing the Process In-House
• Turning Heads
• A Solid Supplier Relationship
• Will Mexico's Trading Role Persist
• MacroFab's Biggest Growth Area
• Going Forward

Links and Resources:

• Watch Related Episodes:
  • Macrofab: Modern EMS Solutions in North AmericaRead Related
  • Data Security, 5G and Onshore PCB Manufacturing with Dr. Rob Spalding
  • Achieving Diversified Electronics Supply Chain
• Connect with Cody Endlich on LinkedIn
• Visit MacroFab website

Transcript:

Zach Peterson:

And we talked with someone recently who was working on the supply chain in Mexico. His name is Andrew Hubert, and he had mentioned that that kind of sourcing environment was not there, at least from what he saw. And that companies who are producing in Mexico were maybe hesitant to talk to each other because, I guess, they don't want to lose their competitive edge. And so, it can make the sourcing more difficult and maybe put some of that burden back onto the customer. Are you guys then taking up that burden?

Cody Endlich:

And we have in many cases, and in some cases on drastic material modules, not even just components, I mean, something similar to a CPU, and it's happened multiple times where we've had to strategically facilitate a backdoor resource, if you will. And that's why it's so key to align yourself with someone who understands strategically how parts move throughout the world.

Zach Peterson:

Hello everyone and welcome to the Altium OnTrack podcast. I'm your host, Zach Peterson. Today we're talking with Cody Endlich, Head of Strategic Sourcing at MacroFab. If you're familiar with the Ultimate platform, then you should know that this links directly to MacroFab. So, it's very nice to have someone from MacroFab here to talk with us today. Cody, thanks for joining us.

Cody Endlich:

Thanks for having me, Zach.

Zach Peterson:

Yeah, I don't get too much of an opportunity to talk to sourcing people or procurement people, supply chain people, so I thought this would be fun. Maybe before we talk about what MacroFab does, give us an overview of your background and how you got started at MacroFab.

Cody Endlich:

Sure. So, I have a background on the distribution side of the house, more specifically the open market distribution side of the house, working with smaller independent distributors to the biggest independent distributor in the world and Smith and Associates here locally in Houston. Early on with MacroFab, funnily enough, I was actually in a sales role and very early on working closely with procurement on a few projects, realized that there was probably a greater advantage for me to move over to a sourcing role to fill those gaps.

Obviously, this is 2021, we're well into the chip shortage and there were obviously quite a few jobs in a lead time limbo, if you will. So, after freeing up a few of those jobs and getting them to production, finding our customers some of the more hotter ticket items that they needed to go to production, I transitioned into a full-time strategic sourcing role for MacroFab.

Zach Peterson:

So, you said you got into this kind of role by freeing up some production jobs where lead time was in limbo. I take that to mean you're the guy that knows how to find the hard to find components and probably how to verify the source as well.

Cody Endlich:

So, to just dispense with the pleasantry, Zach, I mean quite frankly what we've done is internalize the broker process, right? So, where traditionally a lot of my buyers or buyers at other CMs and OEMs would come to a point to where a part is not in stock and authorized to franchise, they have a list of their go-to AEs at the big players in the independent market and sending these guys a list saying, Hey, here's my parts for the week. I'm handling that for all of our production jobs across the board internally. It works out well for us, obviously, as you can imagine, because we're cutting out what is, I mean standard right now, maybe 20 to 40 points added on a part if you're buying through an open market broker versus actually knowing where the stock is going directly to that independent stocking distributor who has the stock, creating a relationship with them and bringing the product in ourselves.

It saves us tons of money, it saves us lead time obviously, and helps us get a little bit tighter on quality, right? Because there's less hands the parts are exchanging through before they make it to us. And quite frankly, the markets dictated we do things like this. We're a CM, I think it goes without saying that we're always in a position to be very aggressive on our quotes and our jobs without sacrificing quality. And I think this puts us in a really great position to take advantage of our resources and pass that benefit down to our customers.

Zach Peterson:

So, maybe give us an overview of MacroFab and what MacroFab does differently from some of the other CMs out there.

Cody Endlich:

Yeah, great. So MacroFab is essentially a platform and the traditional capacitance in which customers would interact with us would generally be, an EE would come to our platform with a design ready to go to production. It's not an EDA tool. It's a platform where an engineer can come in and drag and drop their CAD files, their BOM, everything for one specific production run, and the platform will transition that into a visualization of the board, giving them an idea of what it's going to look like. It allows them to do a little bit of iterating right there on the platform, little bit of last-minute changes. If there's some real estate that was juxtapositioned, a little bit off, and then they just go to the next screen.

On the next screen, it'll bring up their BOM. The bill of materials is already automatically uploaded into a formatted layout that will show you real time stock levels through authorized and franchise distribution for those parts that you are requiring for this specific build. It'll also provide alternates for those parts as well. So, if you expand into each individual component, you can see alternates listed. And then, once the BOM is squared away, we move into the next step, which is another screen where we're moving forward to get a quote, a fast, good, better, best. There're options.

And essentially, the big difference with us and having a network of manufacturing partners is the capacitance and the elasticity and the customization, if you will, to each customer's specific product run, right? Obviously a 10,000-piece run of a consumer electronic product is going to take a little bit different job level than government computing militarized company that's looking to produce with a bunch of ITAR restrictions. We have that flexibility within our manufacturing network. So, they get a quote, they like what they see, they hit place an order, and whether it's 10 boards or 10,000 boards, the order gets placed and positioned with the appropriate partner. We're API'd into all of these partners.

So, the capacitance that each one of them have is accessible to us in real time, so we know where we're going. And once the job is placed, they can track that job in its progress through the route. It's cheeky, and I hate to use it, but almost like the Domino's Pizza tracker, right? Trevor, put your pizza in the oven, Becky is putting it in the box and you get to follow it along the way. It allows engineers two big things, I think.  It allows them to maintain accountability and ownership of their design while having complete communication with the factory in real time of what's going on, what's happening, if there's any issues. And I think in a nutshell, that's the Amazon of contract manufacturing, so to speak.

Zach Peterson:

Interesting. So, when you say a manufacturing partner network, where are your partners located? I think that's a big issue for some folks. They don't want to go overseas or they're legally restricted from going maybe outside of North America or outside of Europe.

Cody Endlich:

Of course. Great question. So, we are entirely CONUS, continental US and North America and Mexico. So, we do not do, we don't have any partners in Asia. We're not currently working on any jobs going on in Asia or Europe, South America, everything is CONUS. So, there's obviously a massive undertone of nearshoring and re-shoring going on there, and that's obviously a big key add that our customers really align with. If they're looking to re-shore, bring it back to the US or if there are safety concerns regarding the product, whatever the case is, intellectual concerns across international, whatever the case is, I mean, we are allowed to circumvent that by offering our customers a re-shoring solution.

And obviously, it goes without saying the growing manufacturing capabilities in Mexico trying to rival what's been going on for decades and decades in Asia. We do see a lot of benefit and we do actually see customers, more customers moving to Mexico as we have a facility in Guadalajara. So, that's a major aspect of our mission is the re-shoring effort as well.

Zach Peterson:

The re-shoring trend is relatively new, but you guys are not new, right? MacroFab has been around for a little while.

Cody Endlich:

Exactly.

Zach Peterson:

So, you guys were already doing the re-shoring thing before it was a trend.

Cody Endlich:

Sure, yeah.

Zach Peterson:

What drove that? Was that part of the core strategy for the business when it was first founded?

Cody Endlich:

Now I don't want to speak out of turn, but if I would have to guess, if you look at us in terms of early on in inception, MacroFab was really created for the manufacturing companies that are having trouble coming to production. They're finding that when they go to a CM, the CM says, "Oh, we're not going to bother ourselves with a 250-piece run. We don't have time for this." They're having trouble going to production period. So, when we offer that elasticity to not only facilitate a solution for a customer that's doing a proto run or an R&D run, but on a scale and everything is already organically centralized here in the US, I think that just grew.

But where we really saw a trend was when we did have customers early on expressing an interest that, hey, not only do we want to pull out of Asia, we want more control, we want more communication, we want to know exactly what's going on in real time. We need better communication, we need better visibility. And I think that trust aspect aligns with the re-shoring and keeping it organic and here in the US. And so, I don't know if that was early, obviously it was an early driving factor, but it's something that we've been focused on for years now, and yeah, it's certainly not something that we're seeing, we're spotting a trend and reinventing and shifting the way we do things. I mean, this has been a center of our mission, the re-shoring aspect for years now. So, yeah.

Zach Peterson:

So, it sounds like this is really one of the key benefits that people have probably been responding to quite a bit recently. Is that fair to say?

Cody Endlich:

Yeah, absolutely, absolutely.

Zach Peterson:

Are there any copycats out there that might be trying to mimic this kind of model to bring manufacturing, let's say, closer to home?

Cody Endlich:

None that I've paid attention to. I think a lot of companies, it's very popular right now, right? I think what's more important is, it's funny because a lot of the companies, OEMs specifically, and CMs are guilty of it as well. It's following the trend, following the trend, following the trend. And I think the main point here is kind of like what MacroFab has done is, okay, yeah, it's great. We see the chip markets lighting up and opening up. We see, okay, re-shoring, but what is that really? And we see customers saying, "Okay, instead of just getting in line and jumping on the re-shoring bandwagon, breaking it down, how does that look? Are re-shoring our manufacturing? Are we re-shoring our reliability on our sourcing for components as well?"

Because so now customers are not just for building, they're aligning with partners for sourcing as well so that they don't have that reliance on sending a blind purchase order for $50,000 worth of parts to Asia, having to wire the money before they even receive the parts and confirm whether they're new and. I mean, it all plays into the big picture of re-shoring. So, that's really what, I mean. I'm sure there's other companies and there's a massive re-shoring effort all across the board, but direct competitors, I couldn't tell you.

Zach Peterson:

Yeah, because what you're describing for what the platform does, and I think in terms of the user experiences, it's kind of half connected manufacturing platform, and I know of one other, but not with the capacity access in North America, but then in a way it's kind of a 3PL

Cody Endlich:

Yeah. In terms of having the capacitance, specifically in the US, it's vital because it's plentiful, it's never ending basically in Asia. And it is harder in some cases to sell because there is a financial component to all of this. And I think that's really where the main focus has been, is to make sure that we're bridging that gap seamlessly, that we're not leaving any stones unturned, okay? We're going to bring it back from Asia that's been doing our manufacturing for the past 50 years. How is this really going to affect us financially? And it's getting very resourceful in other aspects. Like I said, that comes down to the component sourcing, that comes down to the raw material sourcing for the secondary builds because we're obviously not just a PCBA. We do secondary assemblies, box builds, the full product. So, it is a challenge to focus on how to keep that completely re-shored, but we're doing a pretty good job, so far.

Zach Peterson:

So, you also mentioned the sourcing aspect and bringing that back on shore rather than just sending out an upline purchase order to someone in Asia who you may not know very well.

Cody Endlich:

Sure. Yeah.

Zach Peterson:

I'm wondering what the sourcing picture looks like for you guys, because if someone goes over to Asia and they want to produce an entire product, if they go to the right factory, the factory owner is going to be able to coordinate with five or 10 other people that they know. And by the end of the day they've got a plan in place to produce for you. And it can probably scale up to thousands, tens of thousands of units, however big you need to go. We talked with someone recently who was working on the supply chain in Mexico. His name's Andrew Hubert, and he had mentioned that that kind of sourcing environment was not there, at least from what he saw.

And that companies who are producing in Mexico were maybe hesitant to talk to each other because, I guess, they don't want to lose their competitive edge. And so, it can make the sourcing more difficult and maybe put some of that burden back onto the customer. Are you guys then taking up that burden if you guys are going to produce with part of the build going on in North America?

Cody Endlich:

Correct. Yes. And we have in many cases, and in some cases on drastic material, modules, not even just components, I mean something similar to a CPU where we've had to go directly to a European partner that opened us into a global pot, if you will, a lot of this specific module. And it's happened multiple times where we've had to strategically facilitate a backdoor resource, if you will. And that's why it's so key to align yourself with someone who understands strategically how parts move throughout the world, right?

What a lot of customers don't understand is there are avenues to travel down where you might have a job sitting in limbo waiting in a 26-week lead time for one component. And Sony bought 120,000 pieces of that component last year, and you don't know that there's a strategic partner that connects the dots to say, "Hey, well guess what? They're only going to allocate 50% of that stock for production. They have a 10% cushion and they've opened the rest up to us. We can get you what you need in three days." That's what we're doing. And so, that's that added value you get when you start operating as the broker, for lack of a better phrase, versus relying on the broker.

And when you talk about re-shoring, then yes, you start to build those resources in-house and stateside to where the reach outside of the US is minimal, and the reliance, the assets and liabilities are CONUS, right? They're on us and we see who we're dealing with and hey, look, this isn't, I say this cheekishly, I guess, I don't know. This isn't a bash Hong Kong or Shenzhen session either. We do have key partners in Asia. It's a finite list, right? They've earned a spot on that list because we know who they are. They work well with our partners, our test labs, our escrow partners. Funds are never transferred unless parts are on our dock with a past confirmed test report. But it's rare, right?

We have a very finite group. You can get lost very quickly and very easily trying to take that on yourself. And that's what a lot of customers have felt relieved is just turning that over to us because we are able to package that entire service into one offering, right?

Zach Peterson:

Now, you mentioned something here which was test, and I take that to mean counterfeit testing of components.

Cody Endlich:

Sure, absolutely.

Zach Peterson:

So, what level of testing or inspection are you guys doing? Is this X-raying the dye? Is this chemical testing on the exterior? Are you trying to identify, maybe not a fake, but a used component or an old component?

Cody Endlich:

Got you. So first and foremost, and we're really proud to say this, in the year, almost two years that we've been doing strategic sourcing here, we have a 0% component failure rate, and that's not 0% counterfeit component. That's improper storage, whatever the case is, we're running a 0% component failure rate on our strategic sourcing side, and that can actually not be said right now for our authorized distribution side. We've gotten some parts in from even the big guys recently where it's like, who stored this? Stuff's moving so fast. The market is opening up and stuff's moving slow for the independent market right now, but it's moving very quickly and actually pretty steadily in the authorized. So, we don't know what's going on. We just know that when it hits our dock, we're trusting on the authorized and franchise side that everything is to be exactly like it's supposed to be, right?

I mean, that's just the phrase, I think the sentiment across the industry. Everybody says we only buy from authorized and franchised even when they don't buy from authorized and franchise only. But yes, so when we do go to open market, we do have capability to do the whole menu of testing from basic EVI, acetone swiping, decap, we're doing solderability. Now, this is not MacroFab's internal capability. Again, we've partnered with the largest test laboratory in Shenzhen, Hong Kong, in White Horse, and nothing leaves Asia unless it has passed through White Horse. We're also members of ERAI.

So, anytime, before we even go to a potential vendor, they are highly scrutinized through the ERAI system, which I'm sure you're well aware of ERAI and how they're somewhat of an unspoken supreme authority when it comes to counterfeit mitigation in the market. And we find a lot of benefit in that partner, both of those partnerships, and that really allows us to hone in to whatever level the customer needs us to take it to. If they require a full function test, then we'll do it and we provide that. And nothing ships until everything's confirmed new and original. So, that's how we go about it.

Zach Peterson:

So, what you're describing here and the folks that you're procuring through when you maybe have to go from authorized distributors to a broker or you guys are acting like a broker yourself, I think when most people hear the word broker, they may be thinking, "Oh, you mean that list of companies that I see on Octopart under the non-authorized distributors section?"

Cody Endlich:

Sure.

Zach Peterson:

Could that also be considered a broker or are those...

Cody Endlich:

Absolutely. That is a broker or an independent distributor. Now, it's really good to make that distinction. You do have independent distributors and you have brokers. This is just the facts, an independent stocking distributor and a broker. An independent stocking distributor is going to have a certified AS6081, AS9120 ISO certifications, every one of them under the sun, actual physical warehouse with processes and Iron Cloud, QMS testing procedures in-house, the likes of the Smiths and the velocities in the fusions of the world or the America IIs.

(24:55):

And that's a big difference from the, not a bad guy, but the guy in Lakeland that's working out of his garage that's kind of retired and has a couple of customers, but also does sourcing on the side, that is a broker. And then you also have boiler room situations where you have a guy running five kids in a call center just jamming people up for parts all day. These are brokers. And I wouldn't position ourselves as a broker whatsoever. Essentially, what we've done is taken the already known industry resources at pretty much everyone's disposal and decided to capitalize on them and bring that function that has traditionally been an outside function that has, or a third-party function that has existed for years between buyer and independent distributor rep. And we've decided to bring that process and do it ourselves.

So, when we're doing our own resourcing and doing our own sourcing, especially, it was very important early on to make it established that we were doing this correctly. And so, it was key partnerships like aligning with ERAI and becoming very good partners with White Horse to make sure that we were doing that.

Zach Peterson:

Yeah, because what you're describing here, I think is maybe going to be seen as a bit opaque or inaccessible for smaller companies, or even for an individual designer or a consultant who may need to manage production on behalf of a client. If they're trying to procure and they have an issue with a long lead time part, they've probably got two avenues. One, change the design and find an alternative. So, that can be a headache. Or they might find someone who is a distributor in Asia, maybe they're non-authorized distributor, but they put these insane markups on some components like 20 or 25X markups sometimes. And it's just crazy the prices that they try and charge.

But I think people may feel they're backed into a corner a little bit and they got to get this build out and they have no other choice. And so, they're weighing, "Well, do we spend 20 hours changing the design or do we just bite the bullet and spend all this extra money to just buy this one part?" So, you guys have really identified the larger broker, I guess you could say, or the larger partner who's able to access, like you mentioned, maybe a stock lot of 50,000 components from Sony.

Cody Endlich:

Sure, right. And yeah, I mean, I have to put my sales shoes on at this point and say...

Zach Peterson:

Go for it.

Cody Endlich:

We do have it right in that facet. How do I say this politely? I want to not say we're not trying to give the house away, but I mean, this is where it's important to say it's going to turn heads. If nobody wants to talk about re-shoring, maybe this turns their head, hey, well, you have a partner here that's been doing this. You need to align with someone like MacroFab. It sounds like it. We're certainly not out to become some type of the next big part distributor. This is a service that is provided to our customers that want to go to production, and it's maybe a little gun check moment for some people that don't want to change the way that they do things.

Or maybe they do want to do things, but they're hesitant to partner with someone or don't know who to partner with. It's a gut check moment of how bad do we really want to go to production? And if aligning yourself with a partner like MacroFab allows you access to the components that you need to go to production, it just sounds like a no-brainer. That would be the best option for me if I was in that position.

Zach Peterson:

I think another thing that maybe mid-size companies might do, because they have to maybe order in slightly larger amounts, and of course once they see the broker markup on something like Octopart, they really shy away from that is they may go to a 3PL to try and coordinate all this.

Cody Endlich:

Right.

Zach Peterson:

And it seems like that's going to be just another layer of overhead for them that's going to impact their ability to be competitive.

Cody Endlich:

It is really important to discern, again, between a fly by night one component situation with a broker and actually creating a relationship with a solid supplier who is consistent in pricing and quality, right? And I think the problem is not having the partner to interact with on that level and just saying, "Hey, we're going to do it on our own." I mean, we've had plenty of customers saying, "Hey, we're just going to roll the ball on these parts that we saw on eBay." And it's again, that's the risk you run in taking on that responsibility yourself and without being absolutely sure of how that side of the market works.

And it's funny because components play such an integral aspect to this entire picture, but it's the most clandestine, almost ill researched, I guess, if you will, side of the house, right? And I think now, coming off the back of this shortage, you're finding companies saying, "Okay, well, it's great that the markets are lightning up again, but how do we not be in the situation we were two years ago? How do we not let Ford and Apple beat us to the table again? What do we need to do to forecast?" I mean, forecasting, this is where forecasting come. It's getting back to the basics. I mean, forecasting is wildly different when you're going at it from an uninformed perspective of what's on fine ships and what's on Octopart, and this is I guess what I've got to work with versus aligning yourself with a strategic partner that can give you oversight that no one else can.

They can give you insight into lead times, life cycles. And that's what we're doing too. I'm not just out here finding parts, we're digging into data sheets, we're digging into life cycles of parts, and we're passing that data on. We reverse engineering parts so that when we come to a situation where all hands are up in the air and we find out, "Hey, this is just a packaging difference, you guys." We're making sure that there's no stone unturned and there's nothing being overlooked on the front end so much to where we don't really find ourselves on the backend situations where we're having to roll the dice with some random Asian distributor or somebody just posting stock onto eBay or something like that.

Zach Peterson:

That's funny, you brought up a posting stock onto eBay. Sometimes I do see that myself, and you always got to wonder, who the heck is this person?

Cody Endlich:

Sure. Yeah. It's crazy. And sometimes it works out, and I'll say this about counterfeits too. We've had test lab reports that have come back and said, "This is a Phillips marked part." Even from Phillips saying, "Hey, look, we didn't manufacture this, but it outperforms everything that we have manufactured." I mean, so you've got counterfeits now that'll outperform the part that they're counterfeiting. I mean, that's how high this goes. So yeah, it's volatile to say the least, but it's always been this way. And I think that's the most important thing to really point out here is, while we're all coming on the backend, and this shortage really brought everybody's attention to the fact that, Hey, guess what? The independent market's been around for 40 years. Smith's a 40-year-old company next year. America II's been around forever. This open market, these very trustworthy, high level electronic component, independent component suppliers, they've been around for 40 years.

So, this isn't just stuff that, now that everybody's kind of opening up to, "Okay, well, all of our parts are out of stock. Well, what's this? Oh, they're all brokers." No, no, no, no, no. This is what has allowed companies like HP, Dell, Acer, Sony, Samsung to Ford and Apple to make it through. And yeah, everybody's taking a hit, but they're not running around for stock. Their shelves are full. They're selling their excess during a shortage.

So that's the whole position people should strive to be in. It's how solid can we get on our supply chain to where, we're just moving forward. We move so close to a vertical supply chain to where we just own our supply chain. We own it from end to end. And of course, we're talking EBOM specifically here. But yeah, it's really interesting. It's going to be interesting to see how that side of this re-shoring trend develops, or if it doesn't.

Zach Peterson:

Well, speaking of re-shoring, something just recently that was in the news was that Mexico actually surpassed China as the new number one trading partner with the United States.

Cody Endlich:

Yes, yes.

Zach Peterson:

I think the differential is only 2%, so it's not a giant differential. But I think, given the widely recognized advantages of producing in Mexico, especially when your end market is probably the US and Canada, and then your end market is Western Europe, I think it would be reasonable to expect that that differential is going to expand, especially when you start considering more electronics manufacturing in Mexico. Would you agree?

Cody Endlich:

A 100%. I mean, logistically it makes sense. From a quality standpoint, there's a lot easier, they're more accessible than the shadow partner in Shenzhen. And yeah, 100% I'd agree.

Zach Peterson:

So, do you see any elements of government policy or geopolitics affecting that move? Or is that going to be something that wanes and people are going to say, "Yeah, it was tough five years ago, back in 2022, 2023, but we can go back to Asia." Is this going to be a temporary thing or is there going to be any kind of element of ongoing policy changes and geopolitics that really keep people in Mexico or elsewhere in Latin America?

Cody Endlich:

I just think it's too early to, for me at least. I mean, I've never been great with being, not optimistic, but I've never been great at guessing, I guess. It sounds, it's a horrible way to put it, but I'm having a brain fart. I think it's just too early, right? Because with what Taiwan semiconductor is doing in Arizona, and I really want to see what after, how this chip market rebound is going to affect manufacturability first. I mean, I think it's a little too early to call, in my point of view. I think that regardless of what's happening in the geopolitical landscape, you're still going to have customers or companies constantly looking at re shoring, whether it is to US, whether it is to a partner in Mexico and the US. But I see that growing steadily, and I don't see that slowing down.

But on a geopolitical scale, I think that, I look at everything in terms of a chip standpoint because I'm a chip guy, and I really want to see how this rebound because it's very interesting. Right now, it's kind of quiet because not only are we somewhat seeing a rebound, but it's being met with a pretty aggressive level or drop in demand. So, while markets are freeing up, the demand's slowing down as well. So, I'd like to see some more stabilization first before I can make a call on that. But no doubt that I don't think it's going to have any effect on the re-shoring effort. I think if anything, it's going to push the re-shoring effort for companies to just have a little bit more of peace of mind, right?

Zach Peterson:

Well, with that in mind, where does MacroFab see its biggest growth in terms of its partner network to support more customers?

Cody Endlich:

Certainly, in Mexico, we do have a great amount of capacitance in Mexico right now. But again, it's hard to give a specific answer when you're talking about North America and the United States specifically because the capacitance is just, it's so vast, and the elasticity based on each different partner is also going to be dependent upon each specific job. But we're not running into a capacitance issue on our end whatsoever, which is a very good thing. I know that model has served well to keep us running very smooth from a pre-production, kitting, planning to, we're running first articles and everything. So, I think we are on par to do nothing but add more capacitance in most cases on our end.

Zach Peterson:

As all of this stuff evolves, I mean, we'd love to have you come back and talk more about all of these trends, especially as the semiconductor cycle picks back up and this newest round of investment winds down and factories come online. It's going to be interesting to see how the sourcing picture starts to change.

Cody Endlich:

Yeah, it is. I'm really excited. And again, I'm really excited to see how that plays into the re-shoring effort. And I think if the ultimate combination is going to be marrying the two, how do we get our manufacturing capabilities re-shored intelligently, and how do we marry that with a more re-shored focused, CONUS based supply chain sourcing effort as well? And the marriage of the two is definitely going to make a big, big difference, and I'm excited to see what happens. Yeah. Thank you guys very much.

Zach Peterson:

Yeah, me too. Yeah. Thank you so much. Yeah, it'll be interesting to see how that all evolves. Cody, thanks so much for being with us. To everyone that's listening on audio and watching on YouTube, we've been talking with Cody Endlich, Head of Strategic Sourcing at MacroFab. Make sure to go check out the show notes. We'll have some great resources there where you can learn more about MacroFab. And make sure to hit the subscribe button if you're watching on YouTube. You'll be able to keep up with all of our podcast episodes and tutorials as they come out.