Industry Barriers of Flexible Printed Circuit (FPC)

Label:Industry Barriers, Flexible Printed Circuit, FPC

Sep 24, 20243220

Industry Barriers of Flexible Printed Circuit (FPC)

1. Technical barriers

 

In recent years, electronic products have been continuously upgrading their technology. They are developing towards lighter, thinner and smarter applications, which has put forward higher requirements for display technology, data transmission and processing capabilities.

 

So people make more complicated design of flexible printed circuit (FPC). It develops towards ultra-fine directions. This requires manufacturers to have capabilities of higher product design, process research and production process levels, which poses a high technical barrier to new entrants.

 

2. Capital barriers

 

As a capital-intensive industry, FPC requires a large amount of capital investment in production equipment, production workshops, working capital, and technology research to form an industry entry threshold. Due to the numerous production processes, from the input of raw materials to the delivery of finished products, there are a variety of large-scale equipment and production lines required. The initial investment of equipment in FPC production is large.

 

We must control and test everything in the production process, and must have corresponding testing equipment to ensure the product yield. In addition, chemical products such as hydrochloric acid and sulfuric acid are used in processes such as circuit board etching, environmental protection equipment is necessary in recycling and treatment. It can be seen that new entrants need to have sufficient funds to survive in the industry.

 

3. Capacity barriers

 

Current electronic products are constantly showing a trend of centralization. Products with good market response often undergo substantial additional production in a short period of time. Due to the short sales cycle of electronic products, the lead time is short.

 

To ensure a stable supply of FPC, the primary criteria for downstream electronic product manufacturers to choose FPC suppliers are the market response speed and production scale. Therefore, the lack of sufficient production capacity not only affects the company's ability to grasp business opportunities, but also affects the closeness of the company's cooperation with good manufacturers.

 

The FPC industry is a capital-intensive industry, and the initial investment and continuous operation require high financial strength of enterprises. Currently, it takes so much money to build a good production line.

 

To maintain the continued competitiveness of their products, manufacturers must also continuously upgrade their production equipment and processes to keep up with the pace of industry changes. In addition, FPC manufacturers also need to build factories in areas where downstream customers' production is concentrated to maintain their rapid supply and delivery capabilities.

 

When manufacturers of electronic products choose FPC suppliers, they generally need to go through a long period of strict certification and assessment for 1-3 quarters. Both of them cooperate by gradually increasing orders and supply volumes. Once a long-term and stable cooperative relationship is formed, new FPC suppliers will not easily get in, thus forming a high barrier.


 

4. Environmental barriers

 

FPC uses chemical raw materials such as sulfuric acid and hydrochloric acid in the production process, and there are waste gas and waste water discharge in etching and cleaning. To ensure the clean production of FPC manufacturers, the environmental barriers are very high.

 

Manufacturers not only need a lot of money to purchase equipment for the treatment of waste gas and waste water, but also need to have professional technology in environmental protection.

 

Due to the different raw materials and chemical formulations used, the waste treatment are different. It cannot be copied easily. New FPC manufacturers lack experience in environmental treatment. The environmental assessment is strict, resulting in higher environmental barriers.


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