Digi-Key Corporation, experiencing success in the domestic market, initially explored the international marketplace by expanding into Canada in 1995. Today, Digi-Key ships to more than 170 countries worldwide. Its remarkable success in distributing electronic components was fostered by stellar customer service and broad product offerings. A Q&A with President Mark Larson at company headquarters in Thief River Falls provides valuable takeaways for other companies seeking a global presence.
>> What should be on every company’s “to do” list?
A company needs to study the competitive landscape. Determining if your products will be at any competitive disadvantage, and to what extent this can be mitigated, will help illuminate how to most effectively exploit your competitive advantage.
Focus groups of potential customers are one tool that is vital to understanding the local perceptions within the market and – without revealing its identity – a company can find out how these potential customers will react to your proposed business model.
Lastly, understanding the legal, regulatory and tax environments that you will be entering is paramount in mitigating delays and other hindrances.
>> What are the key challenges to success?
Learning to anticipate problems and determine how you will deal with them is important. No company can anticipate them all, so developing a “proof of concept” that will allow testing of your plan on a smaller scale is essential. This limits your downside exposure as the company learns the idiosyncrasies of a market and how to adjust initiatives within that market.
>> What has driven your success?
Digi-Key leads our industry in breadth of products. We stock more than 1 million parts, which gives us a clear competitive advantage.
Customers come first. We track the pulse of the industry to influence our investments into the right tools and resources. We support the engineer with superior service and easy access to comprehensive product specifications as well as one-on-one support throughout the product life cycle.
Maintaining integral agreements with outside service providers – our distinct relationships with UPS, FedEx and DHL, as well as USPS – has allowed us to provide our worldwide customers with the products they need, when they need them, in a matter of several days.
This article was reprinted from the June edition of Business Views. The Minnesota Chamber works every day, offering business solutions to help you advocate, connect and grow.