The global smartphone supply chain needs an upgrade

FEW monuments to globalisation rival the smartphone industrial complex. This year 1.5bn devices will be made by millions of workers at hundreds of firms in dozens of countries. When you tap your screen you are touching an object just as miraculous as Javanese spices seemed to 16th-century European nobs. In commercial terms the system is too important to fail. But this cosmopolitan wonder faces twin threats: the fading of the smartphone boom and the end of globalisation’s golden era. To assess these risks, Schumpeter has “stress-tested” the supply chain’s financial strength. Overall it is in reasonable shape, but a long tail of weak firms provokes concern.

For decades most consumer-electronics companies produced their wares close to home. Nokia hit the big time while churning out handsets from the small town of Salo in Finland. Then in the 1990s a few pioneers, including Cisco, and later Dell, outsourced manufacturing to a network of factories, mostly in Asia. That so impressed Steve...

via Business Feeds

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