Comment by VLM | Hacker News Reader

Comment by VLM | Hacker News Reader

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If "everyone knows" via the media that there's going to be a toilet paper run on chips and your business depends on shipping product, you'd be a fool not to stock up while there was still stock, instead of going out of business until the nonsense blows over. So I know a small time Ham Radio kit mfgr (its like a one man shop) who STILL has about three years sales volume of Arduino-alike chips in his closet.

Sucks locking up that much money in inventory AND contributing to a toilet-paper run, but for him it beats unemployment, and for me, I can buy and build his kits which is better than not being able to...

In a greater economic policy way, its an inflation-reducer. He has a huge pile of money locked up in his closet in the form of unprogrammed Arduino chips, instead of hyperinflating stuff he could have bought like a better spectrum analyzer or real estate or whatever else.

I bought about five years of my small-scale production back in Dec 2019 (what amounted to full reels of most parts, not because I wanted five years specifically). That was driven initially by MLCC cap supply “weirdness”, but while I was buying, it was dirt cheap (well under $2000) to just buy all the components.

It’s come in handier than I expected for the MCU shortages, but it’s also been really nice to not have to even look at stock/lead times when considering/prototyping new products.

I wouldn't be surprised if keeping 180 days of high-running, common parts on hand becomes the norm for high-margin products.

You're probably on to something there. JITD may morph to JITD+B (+B = plus buffer).

To reduce inflation you have to lock up actual money. Locking up goods will do the opposite.

Very few locations produce chips, but some things like real estate or food production are hyper-local. So in a geopolitical sense of central economic control, the inflation in this anecdote was exported to China and away from local real estate prices or local butcher shop sales of locally produced steaks or whatever else the kit mfgr spends money on that isn't made by a handful of Chinese factories.

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