Circuit Breakers.(analyst Vinay Asgekar believes that financial institutions could assist the semiconductor industry with inventory ownership)(Brief Article)(Statistical Data Included)

Financial institutions may help semiconductor makers mitigate inventory management risks

Supply-chain management may need a new type of third-party provider: financial institutions. Vinay Asgekar, industry analyst at Boston-based AMR Research Inc., believes that in the semiconductor industry, where demand is volatile and collaboration difficult, financial institutions can mitigate the risks that deter companies from taking ownership of inventory. "If we can make an insurance business out of health care, then we should be able to make an insurance business out of demand volatility," said Asgekar.

It is a timely suggestion. In the semiconductor industry supply chains are choked with unsold goods and big names like Cisco are writing off billions of dollars worth of inventory. The economic downturn is the obvious culprit but there also are structural problems since "inventory is not being managed efficiently -- it is just being shifted …