Axis Communications Optimizes Production To Conquer Supply Chain Constraints

Axis Communications, the provider in video surveillance, announced that the company has reached key supply chain milestones, including over 45% year-over-year increase in Q1 deliveries with continued growth through May 31, and record inventory levels in its Americas distribution channel to meet strong demand from integrators and end customers.

This comes after a record-breaking 2022 yielding $1.6 billion in global revenue and 20% global year-over-year growth, as outlined in the Axis 2022 Sustainability Report. These achievements are a result of the company’s recent initiatives, along with its industry-renowned sustainability program, which has long focused on enhancing operational efficiency and strengthening supply chain.

It’s that ongoing work — along with boosted efforts and innovative initiatives implemented during the global supply chain crisis — that has helped the company excel and solidly position themselves to meet future market needs.

Supply chain crisis

Prior to the pandemic, Axis Communications had already bolstered its supply chain by enacting a formal sustainability plan, which put an increased emphasis on environmental, ethical, and social factors.

Axis also actively vets and introduces second-source suppliers, expands its use of some of the EMS

It was during the pandemic and the resulting supply chain crisis, coupled with record demand for Axis products, that Axis further stepped up its efforts by intensifying collaboration with its dedicated channel partners and end customers to improve planning, forecasting and inventory management. 

Axis also actively vets and introduces second-source suppliers, expands its use of some of the Electronics Manufacturing Services (EMS) companies to boost production capacity, and drives digital transformation across the supply chain.

Additional innovations

Additional innovations included redesigning over 100 cameras — which are subject to the same stringent levels of testing and quality — to match available components and create flexibility in production, aggressively investing in high-demand components to increase buffer stock, expediting shipping methods in order to support customers and investing in over-capacity with its manufacturing partners. 

These new operational practices, streamlined processes and expanded partnerships will become mainstay and ultimately have a lasting effect on Axis’ ability to serve its customers now and into the future.  

Diversifying and solidifying the supply chain

“Continuous improvement is a part of our DNA, and adversity often sparks innovation, so the COVID-19 pandemic and resulting supply chain crisis really put us into overdrive,” said Jeanette Skjelmose, Vice President of Operations, Axis Communications.

She adds, “Diversifying, and solidifying, our supply chain will have a lasting positive impact for our partners and customers—providing greater resiliency to navigate any future challenges. We are grateful to our partners and customers for not only standing by us through challenging times, but also for working with us to help identify ways to improve our approach toward customer service and supply chain management. Those relationships have played a crucial role in helping us craft a stronger, more sustainable vision for the future.” 

Record inventories in distribution

Despite the lingering effects of the supply chain, Axis’ initiatives helped the company to deliver more units in 2022 than ever before. With Axis carrying record unit shipments into the new year, the company is on pace to surpass 2022’s banner output.

Now, aligning with record inventories in distribution, over 85% of Axis products are readily available at standard lead times, with a few remaining products available but with longer times to delivery. The company continues to boost production in effort to restore standard lead times to the remaining products in the next few months.

Constraints and unprecedented demand

In the perfect storm of supply chain constraints and unprecedented demand for our products"“In the perfect storm of supply chain constraints and unprecedented demand for our products, we have at times over the past year failed to meet our customers’ expectations,” said Fredrik Nilsson, Vice President of the Americas, Axis Communications.

He adds, “We take full responsibility, and we’ve been working hard to restore our ability to deliver the products and solutions our partners and customers need. We are thrilled to be stronger than ever with our team and supply chain, and we are just getting started.”

Enhancements and effective communication

As Axis continues to restore standard lead times for all products, the company will work closely with partners to set appropriate expectations.

A combination of supply chain enhancements and effective communication has helped Axis lay a solid foundation for continued strong growth, and it indicates an end to the volatility that characterized manufacturing during the pandemic era.