23 Aug 2011

Digi-Key CEO Mark Larson Talks (Page 2 of 2)

In recent years Digi-Key has seen a huge level of growth. While many other distributors have seen good levels of growth, Digi-Key has certainly been a winner.

The Digi-Key advertisements have been seen in all the industry magazines, both on-line and in paper. This has created a huge presence which cannot have gone un-noticed by anyone in the industry.

However there must have been a significant level of growth to enable this advertising and presence to be supported. This prompted my next question.

What do you consider is the reason for your success?

In independent North American surveys of component buyers, Digi-Key has been rated “Number One for Overall Performance” for nineteen consecutive years. “Overall Performance” is the combination of a number of service parameters, and Digi-Key is Rated Number One for each: breadth of product offered, availability of product, speed of delivery, responsiveness to customer problems, overall website, etc. This is the same superior performance we offer in the UK and worldwide.

Do you offer support for the products you sell?

We feel that our obligation to customers does not stop once their orders are fulfilled. Our commitment to customer service extends from the order all the way through production. Our talented team of technical experts is available 24 hours a day to answer any questions the customer might have, and they are available by phone, email, fax, or via web chat.

We see that you have recently withdrawn your paper catalogue for green reasons. How do you see this changing the way you do business now that you are only on-line? Did you find that the more traditional methods of doing business were not as successful?

This decision has been met with overwhelming approval from our customers. Previously, with the print publication of our catalogue, we were limited by how often we were able to release up-to-date versions with all of the new products and latest innovations. New products are added to our website daily, which allows customers to view product pricing, in-stock status, and lead-times in real time; this is not possible with the print catalogue.

PDC line at Digi-Key

Digi-Key PDC line

By moving to a solely online publication, customers have access to real-time stock and pricing information as soon as it is available. Our desire is to allow our customers the easiest and most complete access to our resources and to help them to make the best decisions possible for their electronic component needs. The move to an online catalogue was not in order to necessarily increase sales, but to tailor our presentation of products to the needs and desires voiced by our customers—making it easier for our customer base to access product and information from the convenience of their home or work computers. With Digi-Key’s mobile apps for the iPhone, iPad, iPod touch and Android-compatible mobile devices, customers can access Digi-Key from wherever they are.

You have a single distribution centre located in the USA. Do you find delivering orders of varying sizes to other countries to be cost effective? Could I as an engineer, order a single connector from you?

Maybe yes–maybe no. Because Digi-Key offers far more electronic component choices for off-the-shelf delivery than any other distributor in the world, it may be that an engineer could purchase the single connector from Digi-Key and it would ship immediately allowing him to complete his prototype within 48 hours.

Digi-Key Warehouse

Digi-Key Warehouse

On the other hand, if he chose to order it from another distributor who did not have the product in stock, he might face a twelve week lead time. Time is money. Cost factors vary in each situation. Digi-Key often offers the lowest “Total Cost of Acquisition” because it is the world’s best “One Stop” for electronic components. Digi-Key was founded with the intent of providing electronic components of varying quantities, anywhere from one to thousands of parts, to meet the small and production quantity needs of our customers. We are able to cater to both the design engineer and to the country’s largest electronics manufacturers. This is what separates Digi-Key from other electronic components distributors.

You are now the largest electronics distributor. You always need to improve in business or you fall behind. Where do you go from here?

The fact that Digi-Key continues to rapidly gain customers and market share is a strong indication that we are doing many things right. Engineers and professional purchasers are increasingly recognizing that in many cases, Digi-Key is the logical source for product. Our goal is to win their business–to prove the incremental value that Digi-Key can bring to them. We operate in a very competitive environment. We must continue to expand our product offering, improve our service, improve our quality and accuracy, and continue to implement systems that strengthen our value to the engineer and professional purchaser. Our focus must be to continue to bring customers greater value.

What is your next major move – for example do you have any plans to reach out to engineers in other ways? Digi-Key is focused on continuous improvement. I predict that UK customers will see a number of significant and valuable changes on the Digi-Key website within the next several months. Engineers and professional purchasers in the UK will be able to take advantage of these web advances before our customers in Europe, Asia, or North America.

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About the author

Ian Poole is the editor of Radio-Electronics.com. Having studied at University College London to gain his degree he went on to undertake a career in electronic development working for companies including Racal. He became the hardware development manager at Racal Instruments where he was in charge of the hardware development activities within the company. Later moving in to freelance work as a consultant he also developed Radio-Electronics.com to become one of the leading publications for professional electronics engineers. He is also a Fellow of the Institution of Engineering and Technology and is the author of over 20 books.

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