IoT innovation and the art of supply

If the Internet of Things (IoT) is going to be truly disruptive – giving birth to digital transformation via billions of world-changing interconnected – devices it will require the right components and very non-disruptive supply chains to make it happen.

It’s a point often lost on young startups and individual inventors whose entrepreneurial zeal can cloud the complexities of forming a supplier ecosystem. A stable and efficient supply chain supporting subsystems, embedded technologies and discrete components is critical for IoT entrepreneurs because manufacturing their innovation comes with serious financial risk.

You just can’t wing it, improvising logistics, inventories and supplier relationships as you go along. What will you do if there is a spike in demand for your product? How will you control component costs to squeeze out profits if you’re competing in a low-margin market? How will you handle security, testing, certification and compliance if you’re in a regulated market like medical devices or the burgeoning automotive sector?

In order to innovate in the Internet of Things, you have to master the Supply Chain of Things™. For decades, Avnet has provided answers to those questions for large multinationals. Today, we’re also helping thousands of small entrepreneurs, inventors, and makers solve inventory complexities and investment risk. Because some day, they may become the next big global brand-name.

The Journey

technician building new product prototype

Establishing the right supply chain of things is particularly challenging for IoT inventors because even the simplest of IoT devices is intrinsically complex. The easiest way to approach it is to segment supply chain component needs into three core IoT modalities. First is the application of the device – the sensors, actuators and other micro-electro-mechanical systems that define how it physically works. The next modality is the intelligence, which determines which microcontrollers and subsystems are needed to process the information the device creates, consumes and shares. Lastly is communications, including the wireless chips, radio micro-modules and protocols needed to transmit the information between devices and up into the cloud.

At Avnet, we have created a unique community-supported environment in which IoT inventors can learn and develop their supply chain strategies as they prepare to go to market. Start with – a community of testers and evangelists of Internet-connected hardware. Here, inventors can learn about the best systems and components for their solution by tapping into 200,000 engineers, makers and hackers, 90 technology component partners, and 100 Hackster Live ambassadors who can guide their way.

With the components and subsystems identified, next comes the community, where inventors can get expert support for every stage of their product lifecycle including funding, engineering, manufacturing, marketing, and of course, supply chain management. This community offers all the strategic and tactical resources needed to turn an inventor’s vision into a marketable reality.

The last step is supply chain fulfillment. Here, Avnet serves as a global distributor of components, embedded technologies and integrated solutions from which IoT inventors can bring their innovations to life. Premier Farnell extends that ecosystem to a maker community of more than 430,000 members in 36 countries, stocking more than 600,000 products and representing more than 3,000 manufacturer brands.

The how of supply chain management is as important to IoT inventors as the what. Things like quality, inventory optimization and standardized manufacturing practices are essential for emerging companies to meet customer expectations. Avnet offers these entrepreneurs a supply chain solution innovation center, called Avnet Velocity, where a team of supply chain architects can lead them through the creation of both their digital and physical supply networks.

For example, Avnet’s mastery of the supply chain of things helped Pit Rho and Twyst bring to market the “Smart Bag.”  This product concept is changing the way people shop by creating a Smart Bag, which uses IoT to link the in-store shopping experience with the convenience of online shopping. The result: no more waiting in check-out lines!

Disrupting a market with a new IoT innovation involves considerable planning and financial risk. Most IoT inventors will admit that they’re not well prepared for supply chain management without a helping hand. They need an expert to help them understand their options, reduce risks and provide access to resources to make their IoT vision a reality. It all comes down to having the right products in the right places at the right time, guided by the right people who understand the complexities of strategic sourcing.


By Alex Iuorio, senior vice president of supplier business development at Avnet (NYSE: AVT), a leader in technology distribution. The company designs, supplies, makes and delivers solutions that enable customers to get their products to market anywhere in the world.

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