Semiconductor Shortage Drives More Counterfeiting (.PDF Download)

March 28, 2022
It’s getting more and more difficult to keep counterfeit chips out of the world’s supply chains. Here’s why.

Intellectual property crime is on the rise right now as companies around the global scramble to fill the gaps left by an ongoing semiconductor chip shortage. Taking advantage of a situation that’s left many of these organizations managing order lead times of up to 52 weeks or more, counterfeiters are currently flooding the market with dangerous knock-off options that procurement professionals should avoid at all costs.

The allure of these knock-offs—which, of course, aren’t identified as such—can be strong in a marketplace where demand for chips is extremely high and supply is at all-time lows. A recent U.S. Department of Commerce report found that demand for chips was up to 17% higher in 2021 versus 2019, and that the median inventory of semiconductor products fell from 40 days in 2019 to less than 5 days in 2021 (these inventories are even smaller in certain industries).

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