Digi-Key and Jabil: Driving Digital Supply Chain Innovations

Digi-Key Electronics is one of the world’s fastest growing distributors of electronic components. The longtime Jabil partner takes full advantage of both the company’s vast inventory and overarching focus on innovation to address an ever-evolving continuum of customer requirements.

Based in the northwestern Minnesota town of Thief River Falls, Digi-Key offers more than 11 million components, with over 2.6 million in stock and available immediately. Founded in 1972 as a mail-order catalog business selling leftover parts, the company has grown into a global leader lauded for its extensive product selection and strong business acumen.

With 44 local websites translated into 16 languages accepting 26 currencies, Digi-Key fuels innovation from prototype to production all over the world. Recognized for its early and enduring digital innovations, Digi-Key’s online Marketplace offers fast and efficient one-stop shopping.

“Time to market is always a factor for our customers, so Digi-Key’s vast inventory and expedited delivery is a big strength,” explains Tom Gregoire, Director of Supply Chain Management at Jabil.

End-to-End Digital Thread

In an age when an end-to-end digital thread is critical for keeping pace with change, Digi-Key has made great advances automating its ordering process. “Providing a plethora of products with off-the-shelf delivery is critical,” says Paul Dosser, VP of Business Development at Digi-Key. “We’re honored that Jabil named us a strategic preferred supplier because of the strong fit with our respective business models and Digi-Key’s ability to support Jabil customers from design all the way to production.”

Jabil’s design engineers and buyers enjoy “express checkout,” thanks to a link between Digi-Key and Jabil’s Coupa cloud-based procurement system. The streamlined process allows users to view inventory and place orders simultaneously. “Bringing in Coupa is a great example of how we are working with Jabil to find smarter ways to allow for prototypes to be purchased quickly and easily within the Jabil process,” says Denise Lingenfelter, Global Accounts Director at Digi-Key.

Components can also be ordered for next business day delivery within the U.S. “They’ve done a great job of digitizing the buying process,” notes Gregoire. “It’s sort of the equivalent of the Staples’ ‘easy button’ for design engineers. In addition, because of Jabil’s long-standing relationship with Digi-Key, we receive fair and competitive pricing.”

Filling a Special Niche for Design Engineers

Digi-Key also stands out for its ability to accommodate the purchase of small quantities of components when engineers are exploring new concepts or products. Unlike other component suppliers that focus on large quantities, Digi-Key nimbly fills a special engineering design niche.

“Digi-Key is a great resource when our design engineers are looking for technical support,” Gregoire adds. “They can search online for a wide range of components from various manufacturers, receive design recommendations and purchase quantities best suited for their individual needs.” For Jabil, Digi-Key also shines as a resource when manufacturers or fulfillment distributors can’t support inventory or cannot provide parts in time to support manufacturing requirements. “We have the most flexible supply chain program in the market today,” adds Lingenfelter. “Jabil’s forward-thinking approach about their own supply chain and digital initiatives aligns perfectly with where we are going as a corporation.”

Among the key initiatives undertaken over the past year were inventory and supply chain risk mitigation. “Our goal is to ensure Jabil can meet their needs without adding excess inventory,” notes Lingenfelter. “In addition to our broad line card and deep inventory, we have the most flexible supply chain program.”

An Evolving Partnership

Jabil’s alignment with Digi-Key extends to the highest levels of both organizations. “The relationship we have at the executive level is very open and honest, and we have the opportunity to really develop some meaningful strategies,” says Lingenfelter. “Without that, we wouldn’t be able to be as far along as we are with Jabil.”

Recently, Jabil and Dig-Key expanded their relationship by signing a distributor agreement with Jabil’s Additive Manufacturing. Under this model Digi-Key will purchase 3D filament from Jabil and sell to both external customers and Jabil manufacturing sites. Long term, Jabil 3D manufactured products will be sold under Digi-Key’s Marketplace.

The partnership is built on a foundation of trust and driven by a mutual customer-driven business focus and commitment to innovation. “The relationship with Jabil matches Digi-Key’s values and business model,” concludes Dosser. “Together we can drive great solutions efficiently and effectively for end-customers. We couldn’t be more bullish on how things look for both us in the future.”