Manufacturers worldwide are facing a challenge that doesn’t appear to be going away anytime soon. They are having difficulty obtaining semiconductors, which is delaying production timelines and delivery of goods. There are many factors at play, from the COVID-19 pandemic’s disruption of supply chains and consumer shopping habits to extreme weather and everything in between. According to CNBC, demand for chips is continuing to outstrip supply, and car makers are no longer the only companies feeling the impact.
How does this affect the payments industry?
The chip shortage is having a trickle-down effect on payment equipment manufacturers. Sphere has been notified by our equipment vendors that they are experiencing increased product lead times given component shortages and the strain COVID-19 impacts have placed on the supply chain. For example, where 6-8 week lead times were targeted, in some cases these are shifting to 24+ weeks. For example, what is ordered in May might not be available until closer to November.
What you can do?
Stay informed and be prepared! When placing device orders, know that lead times may significantly increase throughout the industry. To reduce impact to your business, plan ahead. Start thinking about your device needs and develop an equipment forecast through 2021. Whether a multi-lane terminal, encrypting keypad, simple swipe, or even an Apple iPad—all manufacturers are experiencing delays. If your device plans cannot be forecasted through the end of the year, make sure to plan for as much lead time as possible on new orders. Ordering now may minimize disruption to your business.
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