With a million products in its catalog, the global electronics distributor caters to hobbyists, design engineers, and manufacturers alike
RAPID FIRE: A staff of 2600 keeps Digi-Key’s facility in Thief River Falls, Minn., operating 24 hours a day, 365 days a year. Within minutes of receiving an order, human “pickers” locate the desired parts and send them along via conveyor belt for packing. A recent expansion, including 38 new pick stations, 26 new pack stations, and 2600 additional meters of conveyer belt, means the facility can now process 24 000 orders a day, or one every 3.6 seconds. Photo: Gregg Segal
HOMEGROWN: Thief River Falls native Mark Larson [shown] joined Digi-Key several years after it was founded by Ron Stordahl, another local and a childhood friend. At the start, the company offered just one product: a solid‑state Morse-code keyer for ham radio operators. Anticipating high demand for his “digi-keyer,” Stordahl optimistically bought tens of thousands of transistors and other components for his design. But orders were slim, so he began selling the components themselves by mail order. “That proved to be a much better business,” Larson says. These days, the company stocks nearly a million products, up 50 percent in just the last two years. Photo: Gregg Segal
FAR AWAY: “If you were to start with a blank sheet of paper and say, Where would be the logical place to locate an electronic distributor like Digi-Key, this would probably not have been the place,” admits company president Mark Larson. The rural northwestern corner of Minnesota, where Digi-Key is based, is far from any industrial or transportation hub, and the sparse population makes hiring a challenge. Somehow, though, the company makes it work: Special agreements with FedEx, DHL, and UPS guarantee daily air-freight service, new recruits receive extensive on-the-job training, and buses bring workers in from an hour or more away. Photo: Gregg Segal
HELPING HAND: As Digi-Key’s in-house specialist on FPGAs and ARM cortex microcontrollers, application engineer Tony Storey evaluates the latest products so that he can guide customers through their design options. He and his colleagues also contribute tutorials to the website EEwiki.net. “There’s too many technologies for any one person to know about, so we help people find the best fit for their project,” Storey says. His customers include “everyone from people living in their mom’s basement building a perpetual motion machine to design engineers in large companies,” he says. “If we have time, we’re happy to help.” Photo: Gregg Segal
FINAL FRONTIER: A stepper-motor control board designed by Digi-Key engineer Shawn Rhen was added to the Digi-Key catalog in the 1990s. One day, Rhen got a call from someone who said he was with NASA and wanted to use the board on the space shuttle. “I thought it was a joke,” he recalls. It wasn’t: Mission STS-95, which launched on 29 October 1998, took Rhen’s board into orbit as part of a microvibration detection experiment. The experiment went off without a hitch, and the principal investigator later returned the board to Rhen. Photo: Gregg Segal
TO GO: Digi-Key guarantees that any order placed by 8 p.m. U.S. central time will be shipped out the same day. To move packages efficiently around Digi-Key’s huge warehouse, Danielle Wollin relies on a specialized scooter cart, called a MouseCart. Photo: Gregg Segal
READY TO SHIP: The vast majority of items in Digi-Key’s expansive catalog—including thousands of types of resistors, shown here—are kept in stock at its main warehouse. A manufacturer might order enough resistors for a high-volume production run, while a DIYer might order just one. Photo: Gregg Segal
WHERE IS IT? When the odd part can’t be found to complete an order, a dedicated team scours the shelves, tracking down such exceptions. Photo: Gregg Segal
REEL TO REEL: Customers specify how each part of each order gets packaged for shipping. If, say, a given set of parts is destined for placement on a printed circuit board, you can have the parts shipped on a “cut-tape reel.” A Digi-Key packer will wind the parts onto a standard-size reel, each part in its own enclosure. Once you receive it, you can pop the reel onto a pick machine, which will place the part onto your PC board. Here, completed cut-tape reels are getting a final check and a routing label before being boxed up for shipping. Photo: Gregg Segal
CALM WITHIN THE STORM: The Digi-Key warehouse tends to be busiest in the early evening, when many customers place last-minute orders just before the 8 p.m. cutoff, in order to have their packages shipped the same day. And yet the mood on the warehouse floor is surprisingly calm, the pace never rushed or frantic. Photo: Gregg Segal
BESPOKE BATTERIES: Battery packs, like cut-tape reels, can be custom ordered. You can have them welded in a number of configurations, with your choice of terminations, and then shrink-wrapped. Photo: Gregg Segal
TIME OUT: A worker takes a breather in one of the many break rooms that dot the Digi-Key warehouse, while a colleague peruses the shelves just beyond. Photo: Gregg Segal
AWAY WE GO: Once an order has been picked and packed, the last stop before it leaves the Digi-Key facility is the shipping bay. UPS and FedEx both have employees on-site to scan in packages and load them directly into air-freight containers or onto delivery trucks. From the Thief River Falls airport, FedEx flies directly to its global “superhub” in Memphis, Tenn., while UPS flies to its main hub in Louisville, Ky. Domestic deliveries can be in customers’ hands the same day, while those bound for Western Europe or Japan take about 48 hours on average; customers in China can expect a turnaround of about 60 hours. Photo: Gregg Segal
INCOMING: Daily deliveries from DHL, FedEx, and UPS bring in new parts and products, mostly from Asia, to restock the Digi-Key warehouse. Photo: Gregg Segal
THE FIXER: Digi-Key customer service representatives like Michelle Barry field customer complaints and get them resolved, usually within a few hours. “If a customer notifies us about a problem with a shipment, say, on a Monday, we’d aim to have the correct parts sent out to them by Tuesday,” she says. Photo: Gregg Segal
HELP ALWAYS WANTED: A recruitment poster is a testament to Digi-Key’s continuing search for new workers. In a recent interview with a local business magazine, company president Mark Larson noted that if he could find them, he’d hire 200 new workers today. And while it holds true to its Minnesota roots, Digi-Key is finding new business mainly overseas. To that end, it recently opened sales offices in China, Germany, Israel, Italy, Poland, Sweden, and the United Kingdom. Photo: Gregg Segal
By Jean Kumagai
In the 42 years since its founding, Digi-Key Corp. has grown—and grown—into one of the world’s largest electronic-component distributors. Its online catalog features nearly a million parts and products. Last year it sold US $1.6 billion worth of merchandise to more than half a million customers in 170 countries. And the vast majority of Digi-Key’s offerings are kept in stock, available for immediate shipping, in a single place: the company’s 74 000-square-meter warehouse.
That enormous warehouse sits on the southwestern edge of the tiny town of Thief River Falls, Minnesota (population 8661). The nearest city is Grand Forks, N.D., hardly a metropolis. The warehouse operates around the clock, 365 days a year, with the result that any order placed by 8 p.m. local time gets shipped out the same day.
And then there’s the customer service. When you call Digi-Key’s toll-free number, an actual person answers, usually within 5 seconds. From there, you’ll be guided expertly, even if you have no idea what you need, even if all you’re getting is that 10-cent resistor, even if you speak Chinese, Hindi, or Portuguese. In an age of impersonal e-commerce, of voice mail that never gets returned, of languishing on hold, the experience of being a Digi-Key customer can seem almost surreal.