Digi-key and the European Electronic Market

At the ‘electronica 2016’ in Munich we met with Mr. Tom Treichl, Digi-key’s Senior Director of Production Business.

Q: What is your forecast for Digi-Key’s growth in the next few years?
A: We expect to continue along the same course. We see an increase in our customer’s account, and intend to broaden our supply base even further, in order to target a wider range of customers. This development continues as we move into 2017.
Specifically in the European market, we have seen a nice growth over the years. Despite a small ‘hiccup’ last year, due to many currency headwinds, we are back on track, and should see over 20% growth this year in EMEA.

Q: What are Digi-Key’s unique strengths in the global marketplace?
A: I believe that Digi-Key has three main strengths that draw customers worldwide: our inventory, which is the largest, most diversified of its kind in the world; our website, offering huge quantities of information, as well as great mix of products; and our highly popular EDA engineering tools. Digi-Key is definitely committed to the engineering community and enhancing our digital relationship. Many engineers say they like our website because it is so user-friendly, and we see that our website traffic has increased. I just came out of a meeting with a customer who said: “If it’s not on the Digi-Key’s website, we won’t use it for our design.” To me this just about says it all…
Q: How is Digi-Key handling the rise of automotive & IoT?
A: We are hosting more suppliers to support these new initiatives. This is particularly important because of the high electronic content in automotive and IoT products. A main part of our inventories already addresses these areas, and we will continue to expand these offerings next year.

Q: How has Digi-Key been affected by the recent mergers and acquisitions in the electronic market?
A: Every day when we wake up there is another merger or acquisition. Since most of the acquired or merging suppliers are already part of our current line, this is very good for us.
When companies merge, naturally there is going to be some rationalization of their product offering. Even if certain products are discontinued, Digi-Key’s inventory is broad and deep enough to support these changes. In addition, we expect some of the initiatives from our supply base to steer us in the direction we want to go in our marketing campaigns. With regard to pricing, I can say that it is really at the suppliers’ discretion. Sometimes merging companies tweak their pricing. As to the overall effect on the market, I think it is too soon to tell.