However impressive our own figures and strong the data is for the wider industry it doesn’t mean that our suppliers aren’t feeling the pressure from direct customers where demand continues to exceed supply. Equally critical to supporting today’s demand is supporting tomorrow’s demand via the pipeline of new activity currently underway.
At Digi-Key, we're continuing to extend ourselves as we redefine what high service means. By improving and expanding upon our core capabilities, we are looking to consistently add value to both sides of the equation – our suppliers and their customers.
Distribution Centre Expansion
This year, Digi-Key is opening the doors to its brand-new, 204,400 square meter Product Distribution Center expansion (PDCe). This expansion will dramatically increase the amount of space available for storing existing and new products. In addition, expanded automation within the PDCe will decrease turnaround time and boost same-day order fulfilment to customers.
As part of our distribution centre expansion, we developed an in-house automation system that is phenomenal. The most common format in which we ship broken pack quantity is with “cut tape.” “Above average” productivity in what we believe to be our industry-leading process today is approximately 30 picks per hour. With our proprietary designed system, we are achieving 300+ picks per hour.
In addition to productivity, this system also provides enhanced traceability, as we are the only distributor that has developed a way to print key information on the back of the tape, enabling engineers to better organise their components, giving them access to the Digi-Key Traceability portal and the ability to look up additional information in real-time.
Strong Digital Enhancements
It’s not just the physical hardware we are enhancing. Our customers are looking for more and more tools. They want to self-serve, self-quote and easily check availability. They also want to manage their bill of materials (BOM) and share it with others. Customers can now do all this with Digi-Key’s myLists tool. Services like myList make Digikey.com not just a URL, but a place customers go to make their lives and jobs easier.
Our Marketplace allows suppliers to leverage the Digi-Key website while housing products at their own location, is now averaging more than 235,000 visitors a day. Our suppliers continue to leverage this important resource to extend some of their products that don't naturally fit into their own shop – a good example would be larger, bulkier items like test and measurement equipment that may not make sense to ship twice, once into Digi-Key and then again to the customer.
Global Fulfillment Experts
As many of our suppliers learned over the past few years, it’s paramount to invest in the development of your technologies. It’s the one thing you do that nobody else can do. We’re continually investing in our core capabilities, like fulfillment, and making those world-class logistics available to all of our valued suppliers.
In 2020, we introduced Fulfilled by Digi-Key our state-of-the-art warehouse and logistics centre program where we store, pick, pack, and ship our supplier partners’ products globally. This programme gives suppliers the ability to have a single warehouse for global shipments at a very reasonable cost.
What do our Fulfilled by Digi-Key investments look like? Well, we’ve got a couple of CRJ aircraft down the road from our warehouse, ready to fly to Memphis and Louisville, two of the largest distribution hubs in the United States, every night. Our compliance teams have the expertise and latest technology available to make sure the wrong parts don't get to the wrong countries. Digi-Key tax experts are up to date on the myriad of ever-changing laws around digital commerce, domestically and abroad. As a high service distributor, our goal is to shift many of these logistical responsibilities over to our experts, allowing you to instead focus your energies on developing and manufacturing the components that fuel the world’s innovations.
There isn’t a company I know of that isn’t on some type of “digital transformation” path. As a recognised leader in e-commerce with a strong desire to enhance the customer’s online experience, we are offering services and products to speed up your journey.
Our industry moves so quickly, so don’t get left behind trying to figure out the complexities of selling and shipping products around the world. Focus on what you do best, which is creating the best possible products and leave the high service distribution to us.
What’s Next?
The good news is we’re already planning for the next growth cycle because in our industry it's never a matter of “if,” it's a matter of “when.” Let's get digital. Let's get streamlined. Let's get ready to support customers.
Author details: Dave Doherty is President, Digi-Key
