Why our clients choose Unisystem? Sławomir Szweda, CEO, interviewed by Elektronik magazine

“Customers, who are looking for more than just buying a touch panel display, are on the rise. Every year the number of projects involving work in module design is growing”, says Sławomir Szweda, CEO of Unisystem and co-owner of Riverdi

Years ago, the backbone of many polish businesses was to keep items stocked in domestic warehouses and to instantly fulfill orders. Considering the recent delivery time issues, haven’t we gone back to that for a moment? Did we come full circle? 

Items available overnight from a local warehouse were and remain a great asset to the distribution company. For customers cooperating with us we develop stock cushions well in advance. So we can serve their needs resulting from production spikes, for example. Regarding current delivery times for displays, they are slowly returning to pre-pandemic levels. We can now deliver most products in 15-20 weeks, and the most popular models in nearly 10-12 weeks. Our customers appreciate that. We welcome these developments because the instability in question was generating a lot of challenges. 

However, if nowadays a company has products in stock, which are at the same time application-critical, scarce in supply, and hard to replace, then this company gets the upper hand. But these days mere items in stock will not cut it in the display supply market. The supply company – in addition to offering excellent quality products – needs to provide expert technical support that includes knowledge not found on the Internet. 

Nowadays, what do customers demand from a display provider? 

Online you can find a lot of products, applications and all the documentation related to them. But we are able, as a dedicated display company, to extract from this ocean of data all the information that is important and interesting. Then we share that condensed knowledge, for example on our website blog. 

Another crucial feature is to provide customers with access to demo kits, which enable them to conduct the necessary product tests. We can provide such a demo kit, in the form of a display and evaluation board, directly from our warehouse and often in a few days time. This allows customers to quickly verify in practice whether our solution meets their requirements. 

A lot of distribution companies at some point in their evolution are engaged in manufacturing. In case of the display industry, it seems to me that this is a particularly challenging task because of the necessary infrastructure. How is that working out for you? 

The entry threshold into display manufacturing is set high due to the necessary and costly investments. Large-scale Asian companies have specialized in this area. We cooperate with them under the terms of distributor agreements.

Our engineers deal with designing of display modules that include a touch panel and a cover glass (i.e., the protective glass, which can contain a colored frame and the customer’s logo). Our Solutions Department also undertakes the development process of complete devices according to the customer’s design, like SBC or SOM single-board computers, converters, sensors, power supplies. We can put such a module into an enclosure prepared for the environmental conditions in which this equipment will be used, for example by providing it with adequate dust and water resistance.

We operate within a group of two companies with different profiles: Unisystem and Riverdi. 

Why did you launch a separate company? What is its business profile? 

Riverdi is a manufacturer of LCD-TFT display modules. In addition to a whole line of standard products, the company manufactures customized displays, touch panel modules, controllers, AD Board interface boards. Carrying out some assembly work, such as bonding displays with touch panels, requires the right conditions. We achieve such conditions in our cleanroom, which meets ISO Class 6 standards according to ISO 14644-1 (Class 1,000 according to the Federal Standard 209 system). 

One of Riverdi’s competitive advantages is the free access to information. An engineer designing a new device can download all the necessary documentation from Riverdi website, like a data sheet, 3D files, EMI test result, and so forth. 

At present, Unisystem and Riverdi employ a total of 20 engineers. The total employment at both companies is approximately 100 employees. 

How do you deal with software related tasks? 

When we are designing an entire device that includes a display and an SBC computer in the enclosure, then – for software development – we are supported by resources from reliable third-party companies. There are also cases when our work is limited to the hardware domain alone – which means assisting our customer in developing a hardware solution because the customer works on the software development in-house. 

What portion of your business activity is devoted entirely to solution projects? 

The number of customers who are interested in more than just purchasing a ready-made touch panel display, for example, is still growing. Each year we find ourselves with more module design work. 

The advantage of producing customized solutions is that are no compromises that one must always face with regular products. And our customers appreciate that. 

Is the integration and customization of display modules an offer focused rather on a prosperous foreign customer? 

 
The share of exports in our sales portfolio is steadily increasing and is currently about 20% of yearly turnover. However, requesting customized solutions is not exclusive to the foreign customer. Domestic companies also carry out tailor-made projects and make excellent use of the opportunities behind it. 
 

Is this service dependent on a minimum order quantity (MOQ)? Does it involve additional payment for preliminary engineering work? 

The costs of customizing the product or fitting the module to the enclosure, designing its interface connectivity or environmental adaptation must be incurred by one of the parties. However, a lot depends here on the scope of project, the order quantity and specific business terms and conditions. Sometimes these costs are entirely covered by the customer. At other times we can split these costs into several sections – between us, the customer and the manufacturer. More complex projects can last over a year, such as medical devices, as they require a lot of research and testing, as well as obtaining certification. Each time we evaluate how prospective the project is, analyze its lifespan, production scale and then compare this to the required workload. Afterwards, together with the customer we work out the final decision. 

What is the minimum order quantity or value to be customizable? 

The requirements concerning minimum order quantity (MOQ) are a standard in the electronics industry. These also apply to the ordering of displays. The most often required quantity is 1000 units per project. But there is also a particular relationship – the larger the size of the display, the greater the chance of negotiating the final MOQ. 

There are many leading display industry brands on your offer. How do you manage to secure their coexistence in a landscape where there are equivalent products on offer? 

There is no such thing as two completely equivalent products – each display is different. Even if they have the same key parameters, they will differ in availability or price. A wide portfolio of suppliers is not our preference, but rather a necessity to provide the most competitive conditions for customers. This is the secret ingredient of our success (laughs), which is to pursue the best available solution for the customer, not for the manufacturer. However, it is not easy to set up such a business model, because it requires large-scale operations, providing access to all the most important suppliers and enabling us to generate orders on the best possible terms that we can further offer to our customers. It took us long 27 years to reach that goal. This is the reason Unisystem is the largest supplier of displays and the only official distributor of vendors such as AUO and Innolux in this region of Europe. Fun fact, national and European distributors are often redirected by manufacturers to Unisystem as a regional hub, providing not only the local warehouses and logistics, but also the required expertise. 

What are your current financial results? 

This year promises to be a record breaking one, as we are likely to approach PLN 140 million annual turnover. Next year, however, may turn out to be challenging in this matter, and we already can observe that we are getting slightly fewer orders, compared to the same period in previous years. We assume this is affected by the geopolitical situation and the energy crisis. But it is also because many of our customers decided to increase their stocks due to earlier extra-long delivery times. 

How much of the turnover increase is attributed to rising prices?

Well, it is true that in early 2022 display producers have raised prices. On top of that, the exchange rates of the currencies in which we settle with our partners, mainly the US dollar, have also gone up. This directly affects the additional fees paid by customers. Certainly, these processes partly translate into our higher turnover, but I estimate their contribution to be 10% at most. 

What are the most serious issues customers face with displays? 

The main concerns include equipment workflow disturbance resulting from exposure to the factors present at the device’s installation site. Such as electromagnetic interference (EMI). Other factors, like exposing the device to dust, moisture or large temperature changes, or operating the touchscreen with gloves, motivate customers to contact us and reach out for more customized solutions. 

Apart from the cleanroom, you also have a mechanical and electronics labs. To what extent do you utilize these resources?

With our mechanical and electronics labs, we provide customers with further improved solutions. For example, we can design and then print on a 3D printer a fixture used for precise connecting displays to touch panels. We are also able to carry out a number of tests of various touch panel solutions in water splash situations. This gives us the advantage to calibrate the device so that the user can operate it without any issues in the rain. We also have a climatic chamber where, by achieving extreme conditions in terms of temperature and humidity, we test the maximum operating ranges of the customized solutions. 

Besides displays, you also offer single-board computers… 

Single-board computers are needed in lots of modern devices, such as information kiosks. Hence, it is advantageous to engage the customer with a comprehensive product range. It makes us more competitive, because nowadays customers are trying to reduce the number of suppliers, if possible. The supplier with a broader portfolio, full of essential components, is the one preferred. 

Despite the high degree of versatility of displays, are there any dominant industries among your customers?

Although displays are a multi-purpose product, we recognize that our main customers represent the industrial sector. Besides, we provide solutions for many other fields, like supplying manufacturers of cash registers, medical equipment, building automation, or alarm systems. We also fulfill a large number of orders from the transportation area, including passenger information systems. 

Interview by Robert Magdziak