Digi-Key looks to expand in manufacturing and boards
“For the first few years in the UK and Europe we were totally focussed on the engineering market but in the last few years we are starting to expand the focus to low volume, high mix products for manufacturing,” said Mark Larson, CEO of the web-based distributor which supplies all components from its warehouse in Minnesota. This approach will continue to be the case with supplying manufacturing lines. “What’s happened over time is instead of carrying engineering quantities, the business growth is enough to justify the high mix, low volume production,” he said.
“We saw a boost in 2010 when inventory was in short supply many new customers came to us and all of a sudden there were large orders for production sales, and we have been able to continue that,” he said. “We ship to 380,000 sites and that continues to grow but not fast enough to compensate for the surge we saw in 2010. We sense there’s still a constant growth but for Digi-Key the market condition has never been worse than it is today.”
It is also looking to expand its distribution of boards as well as components, having taken on development and production boards from Freescale and XMOS in the last month.
“Probably the thing that characterises our business the most is its board level components,” said Larson. “Customers are more and more looking for solutions. We are taking on more boards level products but we are not up to the level of complete boards yet. Having said that, one of the highest volume products we shipped was the Beagle board from Texas Instruments and it’s clear that the board level approach has a lot of pressure behind it.”
Shipping and support will continue to be out of Minnesota even though there are now sales representatives in Europe. “We do have strong technical expertise but they are not in the field, they are a web chat or a phone call away,” said Larson. “That allows a level of productivity. Our virtual FAEs can handle six times more caseload than an FAE in the field, and if there’s a question that goes beyond the knowledge of the FAE they can easily transfer the call to someone with expertise in connectors or relays for example.”
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