Businessmodel of Plexus

Customer Segments

Plexus provides design and production services and solutions to more than 140 customers worldwide, ranging from large multinationals to smaller technology companies. It divides its customers by sector into the following categories:

• Networking and Communications, which accounted for around 32% of the Company’s business in 2015;
• Healthcare and Life Sciences, which accounted for around 28% of the Company’s business in 2015;
• Industrial and Commercial, which accounted for around 26% of the Company’s business in 2015;
• Defense, Security and Aerospace, which accounted for around 14% of the Company’s business in 2015; Among the Company’s largest customers are Arris Group, General Electric and Juniper Networks, all of which have accounted for upwards of 10% of the Company’s annual revenue in at least one of the past three years.

The Americas is the Company’s largest market, followed closely by Asia Pacific. A smaller portion of the Company’s revenue is generated from customers across Europe, Middle East and Africa.

Value Propositions

Plexus provides value to its customers in the following ways:

• The quality and reliability of its products, which attract repeat business from a range of high-profile companies;
• Its industry expertise, including specialist design and manufacturing personnel;
• Its broad geographic reach, with operations across the Americas, Asia Pacific, and Europe, Middle East and Africa; and
• Its established brand name, the Company being one of the largest and oldest companies operating in its sector. ### Channels

Plexus operates a website at www.plexus.com, which provides details on the Company’s various products, services and solutions. It does not, however, operate an online sales channel.

The majority of Plexus’s sales are made directly through the Company’s in-house sales team. Its regional sales and marketing teams – including sales offices across the Americas, Europe, Asia, the Middle East and Africa – focus on targeting new customers and expanding business with existing customers.

Customer Relationships

Plexus operates a website that details all of its various products and services; the Company, however, does not make any of its products and services available to customers on a self-service basis.

Instead, sales are made by members of the Company’s regionally-segregated sales teams, with sales personnel consulting with customers over a period of time to ensure that all of their individual needs are met. The Company aims to establish long-term relationships with its customers, with the Company providing services under multi-year contracts as well as on a single project basis.

Plexus details all of its upcoming events on its website, affording customers the opportunity to interact with the Company’s representatives in person. It also hosts a news portal on its website, including press releases, articles and newsletters that keep customers updated with the Plexus’s latest developments. Customers are also able to interact with the Company through its social media accounts with Facebook and LinkedIn.

Key Activities

Plexus and its subsidiaries provide services and solutions related to the electronic manufacturing services industry, delivering end-to-end solutions for customers across the Americas, Europe, Middle East and Africa, and Asia-Pacific regions.

These regions double as the Company’s three reportable business segments. Plexus’s core activities relate to the provision of electronics design, manufacturing and aftermarket services to companies with mid-to-low volume, higher complexity products, with its solutions including conceptualization, design, commercialisation, manufacture, and fulfilment services.

The Company provides services to more than 140 branded product companies operating across the networking and communications, healthcare and life sciences, industrial and commercial, and defense, security and aerospace sectors. Plexus additionally provides a range of aftermarket services, including repair, refurbishment and technical support for the products it manufactures.

Key Partners

Plexus collaborates with a range of partners throughout the development and provision of its solutions and services. This includes partnerships with:

• Supplier Partners, with the Company depending on a range of suppliers to obtain the requisite resources for its manufacturing processes;
• Manufacturing Partners, which assist the Company in its production processes; and
• Joint Venture Partners, comprising a range of companies and institutions that collaborate with the Company on various one-off projects. Plexus has recently launched partnerships with Idaho Power with a view to reducing energy consumption, with University of Wisconsin Oshkosh to provide on-board human resources training to students, and with Microsaic Systems to manufacture a range of chip-based scientific instruments.

Key Resources

Plexus’s key resources are its technology and solutions, its IT infrastructure, its sales and marketing networks. Its manufacturing and logistics facilities, its partnerships, and its personnel.

The Company owns various service marks, which are registered in the trademark offices of the US and other countries, and owns a small number of patents; the Company, however, does not consider these patents to material to its ongoing business success.

Cost Structure

Plexus incurs costs in relation to the development of its solutions and technology, the maintenance of its IT infrastructure, the management and implementation of its sales and operating networks, the operation of its manufacturing and production facilities, the management of its partnerships and the retention of its personnel.

Plexus recorded selling and general administrative costs in 2015 of $122.4 million, including the payment of salaries and benefits to its workforce of more than 14,000 full time employees and the payment of rent and utility fees across its network of offices and facilities.

Revenue Streams

Plexus generates revenue through the sale of electronic design and manufacturing services. Its revenue is generated through the following service lines:

• Conceptualise, comprising revenue generated by the Company’s concept and early architecture development services;
• Design, comprising revenue generated from the Company’s specialist design services
• Commercialise, comprising revenue generated by the Company’s downstream product realisation services, which are designed to bring products to market;
• Manufacture, comprising revenue generated by the Company’s optimised production services;
• Fulfill, comprising revenue generated through the Company’s scalable global fulfilment operations, including the integration of logistics, supply chain and IT services; and
• Sustain, comprising revenue generated by the Company’s aftermarket services that are designed to sustain its client’s product throughout their lifecycles. In 2015 Plexus generated $2.65 billion in annual revenue, up slightly on the $2.38 billion the Company recorded in 2014. The Americas and Asia Pacific accounted for $1.39 billion and $1.29 billion respectively, with sales across Europe, Middle East and Africa accounting for $140.3 million.