Billion profit from the new profit margin control policy

Because the newly formulated strict inventory control policy, LED manufacturers in Taiwan photoelectron billion gross profit margin increased from 30% in the first quarter of 2007 to 32.5-33% in the fourth quarter, and the company hopes to continue to maintain the 30% in the first quarter of 08 of the gross profit rate.

Although the average price of LED (ASP) annual decline of about 25-30% billion, but the light has been the implementation of the new inventory control policy, namely if the order product is not shipped more than 60 days, the company will be 50% of the inventory as losses; and if the company inventory has not been shipped more than 60 days, the company will be 100% of the inventory for the loss.

In terms of raw material inventory control, 30 days before shipment, the company is about 50% of the cumulative inventory of raw materials as a loss; and more than 60 days, about all raw materials as a loss.

The new inventory policy is the company's profit and loss statement has a great impact on the actual shipments, the future of other LED packaging manufacturers will follow the rules.

Source: China Semiconductor Lighting Network