The battery sector is changing quickly, with an increasing number of emerging players and novel technologies. This disruption presents both risks and opportunities for existing suppliers as well as new market entrants. To succeed in this dynamic environment, companies need to have a clear strategy that addresses the unique challenges of this industry, including early and thorough planning for their products’ regulatory compliance.
What is driving the battery market?
The lithium-ion battery market is predicted to grow from $122 billion in 2020 to $196 billion in 2026, with the majority of this growth expected to come from the electric vehicle sector. This increasing demand for EVs has resulted in a host of new challenges for the industry, particularly around safety and environmental impact. With many of the current lithium-ion battery manufacturers operating outside of compliance with recognized standards and best practices, new players need to be prepared to address these challenges head-on and demonstrate verifiable improvements to processes.
Which certification standard is right for your company?
Battery companies will need to assess the potential impact of different compliance standards on their operations and select one that best aligns with their business model, capability, and challenges. When choosing a standard, companies should consider the following:
- Does the standard cover all aspects of your product? If not, does it offer pathways for additional or complementary coverage?
- Is it a high-level or detailed standard?
- Does the standard have established operating procedures and training requirements? What are the financial and time commitments?
- How and when can you expect verification of compliance?
- Does the standard allow flexibility for your business model and growth?
- Does the standard have established brand recognition and market credibility?
Best Practices for a safer and sustainable battery supply chain
- Conduct periodic risk assessments to identify hazards and risks early and use this as a baseline for continuous improvement.
- Conduct supplier due diligence and create a supplier management plan as soon as possible to ensure that your company’s expectations are clear and that the suppliers are capable and prepared to meet them.
- Build communication and transparency into all parts of the supply chain and establish a culture of openness and collaboration at every level.
- Follow a robust and transparent procurement process to evaluate suppliers based not only on price, but also on their capabilities and potential for continuous improvement.
- Standardize and streamline your production process to increase efficiency and reduce the risk of quality issues.
- Maintain clear records of all materials and components purchased and used in your production process to facilitate oversight and traceability.
Key Takeaway
The battery sector is a dynamic and quickly growing space. Companies need to be able to confidently demonstrate that they are prepared to meet the challenges of this industry through robust product compliance with the applicable regulatory requirements. The best way to do this is through a combination of upfront risk assessment and planning, and a continuous focus on improvement and transparency.