The Merchant Power Supply Market

­In 2023, the merchant power supply market was worth 35.56 billion dollars. Total revenue is expected to grow at a rate of 4.73% CAGR from 2024 to 2030, reaching almost 49.15 billion in 2030. This market refers to the industry for power supplies sold by independent manufacturers (merchant suppliers) to companies that incorporate them into their products, rather than producing them in-house.

When we refer to the merchant power conversion world, for instance, we are speaking of merchant suppliers who produce, as a finished product, AC-DC power supplies, DC-DC converters, uninterruptible power supplies (UPSs) and DC-AC inverters. The power converter market benefits customers by meeting every imaginable safety, regulatory and compliance requirement on earth—some in specialized markets such as aerospace and medical. This is why the market for power conversion is growing, quarter by quarter.

Merchant power supplies are critical components used in a vast range of industries, including consumer electronics, telecommunications, healthcare, automotive, industrial automation, and IT infrastructure. Manufacturers of these product must continually improve pricing, power density, reliability, size and weight—all while conforming to global standards. For these reasons, the merchant power supply market is under intense pressure from every market segment.

In the consumer and medical markets, the proliferation of electronics smartphones, tablets, and laptops continues to drive demand for compact and efficient power supplies. The shift towards Industry 4.0 and automation in manufacturing processes increases the need for reliable and durable industrial power supplies.

Datacom equipment, spurred by remote work, has seen a big upsurge in recent years. The growth in data centers, AI applications and computing that are rapidly expanding cloud computing and data storage facilities is fueling demand for robust, cost-effective and energy-efficient power supplies.

Since they can require very specialized power supplies, the renewable energy (solar/wind) and the automotive (EV/hybrid) markets represent possible exceptions to the make/buy model. It remains to be seen whether these systems will be designed and built in-house or outsourced to a merchant power conversion company—or possibly will be licensed from a semiconductor company’s reference design.

But, overall, unless the volumes are massive, why bother with relying on an in-house power supply design? The burgeoning merchant power supply business for modular, configurable power supplies means that engineers can have customized cutting-edge product development, design, and qualification in a matter of minutes. Additionally, the latest power converters incorporate intelligence, IoT and communications for monitoring and even control features, making it even more practical to buy off-the-shelf.

In the early 2000s, I wrote for the Power Sources Manufacturers Association (PSMA) that most organizations have no business designing their own power supplies. This is even more true today.

PSD