Ronald Stordahl founded DigiKey in 1972.Subsidies aside, DigiKey officials first had to determine whether they could attract the workers they would need for their expansion. “It is pretty phenomenal to have a company like ours and Arctic Cat right here,” Rick Trontvet, DigiKey’s vice president of administration, told me during an interview in his office. “Their decision says a lot about their commitment to our community.”ĭigiKey is located in an industrial park on the southwestern edge of town, right next to another iconic northern Minnesota company: the snowmobile and all-terrain vehicle maker Arctic Cat. “Their decision to grow their business here is really remarkable when you look at the size of the community and the population,” said Michelle Landsverk, a consultant recently hired to work for Advance Thief River, a local economic development group. (The company, which has a smaller distribution center in Fargo and call centers in several countries, employs about 4,000 people in all). The shell of the new warehouse is largely completed and the company hired 330 more workers last year, bringing its workforce at its Thief River Falls campus to about 3,500. Moreover, the company also got some help from local government in the form of tax increment financing, a break on building permits and funds for new infrastructure.ĭigiKey argued that the expansion would generate millions of dollars in tax revenue for the state in the long run, and on a recent trip to Thief River Falls, I heard few complaints about the public help. DigiKey received $44 million in state tax breaks for its distribution center – a mammoth building that covers as much ground as the old Metrodome in Minneapolis and will have 2.2 million square feet of usable space. The decision heartened the town of 8,600, whose identity has become increasingly tied to the fortunes of DigiKey.Įxecutives won’t reveal where else they looked, or say too much about why they chose to expand at home, but financial incentives certainly tell part of the story. Ultimately, DigiKey decided to build its new distribution center right at home in Pennington County, in far northwestern Minnesota, where the company got its start in 1972 – decades before it became the mega-business that generated $3.1 billion in revenue last year. That wasn’t surprising, considering the Thief River Falls electronic parts distributor expected that it would need to hire another 1,000 workers but was, at the same time, located in one of the more lightly populated regions of Minnesota – one with a tight labor market to boot. They all sound like buzzwords, but it lives here.”ĭigi-Key currently employs 3,600 people in Thief River Falls and another 1,600 at other locations, including a warehouse in Fargo, an office in Bloomington, Minn., and global support offices in a dozen countries.A few years ago, when executives at DigiKey Electronics began to plan an expansion project, they looked at several possible locations in the Midwest. “I'm from the East Coast and I've got some relatives out in the Midwest, but it wasn't until I came here that I can appreciate that difference in pride, work ethic, commitment. “Your people are your differentiator, there's no product that we sell that's exclusively offered only by Digi-Key,” said Doherty, who pins much of the companies success on customer service. Worker amenities were integrated into the planning, said Doherty, including food service, quiet rooms for breastfeeding mothers and a community garden where workers can adopt a plot. Doherty said more than 600 workers have been added since construction on the new warehouse started in 2018. The company received a $40 million grant from the state of Minnesota which requires the company to add 1,000 jobs over ten years.
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