We are one of the leading worldwide independent providers of electronic manufacturing
services (“EMS”). We design and manufacture electronic circuit board assemblies
and systems for major original equipment manufacturers (“OEMs”) in the automotive,
computing and storage, consumer products, instrumentation and medical, networking,
peripherals and telecommunications industries. We serve our customers with dedicated
work cell business units that combine high volume, highly automated, continuous
flow manufacturing with advanced electronic design and design for manufacturability
technologies.
Our largest customers currently include Alcatel Business Systems (“Alcatel”),
Cisco Systems, Inc. (“Cisco”), Hewlett-Packard Company (“HP”), Johnson Controls,
Inc., Lucent Technologies, Inc. (“Lucent”), Marconi Communications plc (“Marconi”),
Nokia Corporation, Quantum Corporation (“Quantum”), Royal Philips Electronics
(“Philips”) and Valeo S.A. (“Valeo”).
We offer our customers significant turnkey EMS solutions that are responsive
to their outsourcing needs. Our work cell business units are capable of providing
our customers with varying combinations of the following services:
• integrated design and engineering;
• component selection, sourcing and procurement;
• automated assembly;
• design and implementation of product testing;
• parallel global production;
• systems assembly and direct order fulfillment; and
• repair and warranty.
We currently conduct our operations in facilities that are located in Austria,
Belgium, Brazil, China, England, France, Hungary, India, Ireland, Italy, Japan,
Malaysia, Mexico, Poland, Scotland, Singapore and the United States. Our parallel
global production strategy provides our customers with the benefits of improved
supply-chain management, reduced inventory obsolescence, lowered transportation
costs and reduced product fulfillment time.
We are focused on expanding our position as one of the leading global EMS providers
to major OEMs. To achieve this objective, we continue to pursue the following
strategies:
• Establish and Maintain Long-Term Customer Relationships. Our core strategy
is to establish and maintain long-term relationships with leading OEMs in expanding
industries with the size and growth characteristics that can benefit from highly
automated, continuous flow manufacturing on a global scale. Historically, we
derived the majority of our growth from existing customers. Over the last two
years, we have experienced business growth from existing customers and from
new customers as a result of organic business wins. Additionally, our acquisitions
have meaningfully contributed to our business growth. We focus on maintaining
long-term relationships with our customers and seek to expand these relationships
to include additional product lines and services. In addition, we have a focused
effort to identify and develop relationships with new customers who meet our
profile.
• Utilize Work Cell Business Units. Each of our work cell business units is
dedicated to one customer and operates with a high level of autonomy, utilizing
dedicated production equipment, production workers, supervisors, buyers, planners
and engineers. We believe our work cell business units promote increased responsiveness
to our customers’ needs, particularly as a customer relationship grows to multiple
production locations.
• Expand Parallel Global Production. Our ability to produce the same product
on a global scale is a significant requirement of our customers. We believe
that parallel global production is a key strategy to reduce obsolescence risk
and secure the lowest landed costs while simultaneously supplying products of
equivalent or comparable quality throughout the world. Consistent with this
strategy, we have acquired operations in Austria, Belgium, Brazil, China, England,
France,
Hungary, India, Italy, Japan, Malaysia, Mexico, Poland, Scotland and Singapore
to increase our European, Asian and Latin American presence.
• Offer Systems Assembly and Direct Order Fulfillment. Our systems assembly
and direct order fulfillment services allow our customers to reduce product
cost and risk of product obsolescence by reducing total work-in-process and
finished goods inventory. These services are available at all of our manufacturing
locations.
• Pursue Selective Acquisition Opportunities. OEMs have continued divesting
internal manufacturing operations to EMS providers. In many of these situations,
the OEM enters into a customer relationship with the EMS provider that acquires
the operations. Our acquisition strategy is focused on obtaining OEM operations
that compliment our geographic footprint and diversify our business into new
industries, while providing opportunities for long-term outsourcing relationships.
Our Design Services
We offer a wide spectrum of value-add design services for products that we
manufacture for our customers. We provide these services to enhance our relationships
with current customers and to help develop relationships with new customers.
We offer the following design services:
• Electronic Design. Our electronic design team provides electronic circuit
design services, including application-specific integrated circuit design and
firmware development. These services have been used to develop a variety of
circuit designs for cellular telephone accessories, notebook and personal computers,
servers, radio frequency (“RF”) products, video set-top boxes, optical communications
products, personal digital assistants, communication broadband products and
automotive and consumer appliance controls.
• Industrial Design Services. Our industrial design team assists in designing
the “look and feel” of the plastic and metal enclosures that house printed circuit
board (“PCB”) assemblies and systems.
• Mechanical Design. Our mechanical engineering design team specializes in
three-dimensional design and analysis of electronic and optical assemblies using
state of the art modeling and analytical tools. The mechanical team has extended
Jabil’s product offering capabilities to include all aspects of industrial design,
advance mechanism development and tooling management. They are staffed to support
Jabil customers for all development projects, including turnkey system design
and design for manufacturing activities.
• Computer Assisted Design. Our computer assisted design (“CAD”) team provides
PCB design and other related services. These services include PCB design services
using advanced CAD/computer assisted engineering tools, PCB design testing and
verification services, and other consulting services, which include the generation
of a bill of materials, approved vendor list and assembly equipment configuration
for a particular PCB design. We believe that our CAD services result in PCB
designs that are optimized for manufacturability and cost, and accelerate the
time-to-market and time-to-volume production.
• Applied R&D. The goal of Jabil’s Applied R&D group is to make Jabil
more profitable by pairing with our OEM partners and establishing new product
roadmaps. Applied R&D is a launching pad for new technologies and concepts
in specific growth areas. This team provides system-based solutions to engineering
problems and challenges.
Competition
The EMS industry is highly competitive. We compete against numerous domestic
and international manufacturers, including Celestica, Inc., Flextronics International,
Sanmina — SCI Corporation and Solectron Corporation. In addition, we may in
the future encounter competition from other large electronic manufacturers that
are selling, or may begin to sell, electronic manufacturing services. Most of
our competitors have international operations, significant financial resources
and some have substantially greater manufacturing, R&D and marketing resources
than we do. We also face potential competition from the manufacturing operations
of our current and potential customers, who are continually evaluating the merits
of manufacturing products internally against the advantages of outsourcing to
EMS providers. In addition, in recent years, original design manufacturer (“ODM”)
companies that provide design and manufacturing services to OEMs, have significantly
increased their share of outsourced manufacturing services provided to OEMs
in markets such as notebook and desktop computers, personal computer motherboards,
and consumer electronic products. Competition from ODMs, such as Hon Hai Precision
Industry Co., Ltd., may increase if our business in these markets grows or if
ODMs expand further into or beyond these markets.
