Jeff Benck: Yes. I mean, what I would’ve said is hanya like a year ago, it was so broad-based across so many classes of product. What I’m €“ what we’re seeing more now is that there’s specific analog devices and specific custom semiconductors and stuff that actually, believe it or not more legacy node. It might be like a 16-nanometer product, 90-nanometer where the particular semiconductor manufacturer maybe is increasing capacity, but on the new nodes so there’s a reluctance to build more capacity in old nodes. But broadly we are seeing lead times come down and have seen that shrink quite a bit. We still have pockets that are very difficult that in fact can gate a build. So we would also say, look, it’s not a €“ it’s not wide open, but what I’m finding is incrementally we’re solving more problems than we were a year ago, which probably provides a bit of opportunity where we might be able to get something clear or be able to deliver something on a shorter lead time than in the past.
So it’s incrementally better, but we’re still going to be dealing with this through 2023. We didn’t mean to indicate that hey, it’s all bets are off. The other thing is our willingness to buffer inventory, right? We’re being more vigilant on bringing inventory down and so €“ so now as you see upsides, right, you may not €“ you sound like you’re setting out a ton of excess inventory to go do other things with. So we have to line these things up, but that, that’s kind of what we’re seeing. I don’t know if you want to add anything to that.
Anja Soderstrom: Thank you. And in terms of labor, do you see €“ still see challenges there or how has that been developing?
Jeff Benck: It’s interesting. It’s there’s €“ when I look around it, some of the people that are doing layoffs or resource actions, it feels like the marketplace is going to soften up particularly in consumer related business. Maybe even some in more compute in the €“ on the laptop side and things like that. So I’m anticipating that we’re going to see more available resource. As you can imagine in our own semi-cap business we’re going to €“ we’re going to moderate what resource we bring on there. At one point we were going after a lot of incremental resource and obviously with the demand shift, we’re also going to be balancing what we do. But I anticipate the labor market will continue to improve as people get through making the cuts that they want to make.
We still have needs in, we are growing in four and six sectors and some of our facilities are on a pretty significant ramp with new products and we will need incremental research, not all of that in the U.S., of course. So, I think that we will still be pushing that. And inflation puts pressure on that, right, as wages go up and that, but I think we’re going to be seeing an improved resource environment as we go through the year.
Roop Lakkaraju: Anja, I’ll just add to Jeff’s comment I think, and he mention of it and I think it’s important where we are seeing additional load and growth is in some of our international sites. And so labor will continue to be challenging in bringing on the level of resources and the skill set in the Mexico, in the Malaysia and some of these locations as well beyond some of what might become available here in the U.S.
Anja Soderstrom: Okay, thank you. And just in terms of your new program wins, are most of them from existing customers are adding new logos and can you also talk about the competitive landscape?
Roop Lakkaraju: It’s pretty balanced. We have a number of new logos. I think we referenced one or two on the call. We’re winning some incremental business as well. I think in this environment we don’t see a ton of customers looking to necessarily switch EMS providers because of the supply constraints and if you’ve had a particular partner pursuing that, is it the right time to make a change there? A lot of what we’re seeing is customers that, we’re in sourced and have said, hey, in this environment, in this economy, are we the best to do this? So as in the past, we have found ourselves competing more with internal manufacturing or plans for that. And so we have seen follow on wins with folks that are already with us, but then also new decisions to build a product out of the shoot with us.
We also have seen pretty good attach rate. I noticed a stat I saw from the team just a few weeks ago that we had, over 75% of our new wins had an engineering component to it, which is pretty encouraging because if we help develop the product then we’re €“ who better to build than if we do some of the engineering there. And that’s been a belief of ours with longstanding belief that makes sense for us. I also, I would say in the competitive environment, it’s been pretty rational. We haven’t seen, as we’ve seen this, the whole space look at profitability and margins. I haven’t seen any competitors do something irrational that has made it inherently more difficult to compete in an RFQ kind of environment. So, I think from that standpoint that’s encouraging.
Anja Soderstrom: Okay, thank you. That’s all for me.
Jeff Benck: Thanks, Anja.
Operator: Ladies and gentlemen, this concludes our question-and-answer session. I would like to turn the conference back over to Paul Mansky for any closing remarks.
Paul Mansky: Thank you, Chad and thank you everybody for participating in Benchmark’s fourth quarter 2022 earnings call. Before we go, I’d like to remind listeners that will be presenting next at the Sidoti Virtual Conference being held March 22nd through the March 23rd. With that, thank you again for your support and we look forward to speaking with you soon. Good night.
Operator: The conference has now concluded. Thank you for attending today’s presentation. You may now disconnect.
