DGI Supply, a DoALL company

DGI picDGI Supply has transcended its corporate origins to become a single-source, value-added supplier of sawing, cutting tool and other MRO products.

By Jim Harris

For the first 50 years of its history, DoALL Sawing Products specialized in selling and manufacturing sawing products. These products were ingrained in the company’s identity since 1927, when DoALL was established by Leighton Wilkie, the inventor of the bandsaw. 

Wilkie would further perfect his invention in 1933, when he developed the first bandsaw able to cut metal. This innovation led its saws and related products to become staples on the manufacturing floors of automotive and industrial manufacturers across the United States.

Over time, the company added other cutting tools and industrial supplies to its offerings. In the early 2000s, it reached a turning point because it had begun to offer not just its own products, but those manufactured by other suppliers.

The rise of the company’s distribution business led it in 2004 to form DGI Supply. “[DoALL] wanted the distribution business to have an identity of its own, instead of having our customers think solely of us as the sawing guys,” says Jim Rudolph, vice president of information systems for the Wheeling, Ill.-based company.

In addition, the company at the time was seeing a decline in demand for band sawing in manufacturing. “Technology was changing, and products were being manufactured in different ways,” he adds. “It became difficult for us to grow by continuing to sell just sawing products.”

Meeting Every Need

DoALL today is the only U.S. manufacturer to offer all sawing elements such as sawing machines, blades, cutting fluids and material handling. In addition to DoALL products, DGI Supply distributes cutting tools, abrasives, cutting fluids, machine tools and other maintenance, repair and operations (MRO) items. The company has national distribution agreements with more than 2,500 manufacturers.

“We try to position ourselves as a single-source supplier – we don’t want to just supply one type of product to our customers, we want to supply all of their production consumables and all of their MRO supplies,” Rudolph says. DGI box

The company has the capability to go beyond its core offerings when needed. “We can source office supplies, landscaping equipment … anything our customers want to buy, we can locate a source and contact a supplier,” he adds. “We are good at locating hard-to-find items and will establish a relationship on behalf of our customers with any company that provides those items so we can include them in our distribution umbrella.”

DGI Supply’s sales staff works closely with its customers to determine their needs. “Our salesmen are highly technical,” Rudolph says. “Many of them work closely with manufacturing staff and spend time on shop floors running tests of our current technologies. We will also introduce new technologies that help overall productivity.”

Diversifying its offerings also helped the company adapt to changes in its industry such as consolidation and increased competition. “Companies always need to redefine and reinvent themselves,” he adds. “If you’re making buggy whips and cars come along, you’re going to need to do something else or you won’t be around for much longer.”

Customer Focused

In addition to diversifying its product offerings, DGI Supply during the past 15 years has worked to increase the amount of value-added services it offers. Industrial vending machines are chief among these offerings. “We have more than 200 large industrial vending installations that allows tools to be placed closed to their point of use,” Rudolph says.

DGI Supply’s industrial vending offerings have helped increase its customers’ productivity and reduced their overall costs. The company’s efforts earned it the American Eagle Award from the Industrial Supply Association in 2010 and 2012 in recognition of its “outstanding achievement in documented productivity savings for its manufacturing customers,” the company says.

The company also provides vendor-managed consigned inventory to its customers. “We are very customer-focused, and are proud of our focus on individual customers and customizing solutions for them,” Rudolph says.

Technology such as electronic data exchange and other systems help DGI Supply communicate with its customers. The

Company is building its online presence with the help of Intershop, who helped build its e-commerce website, dgisupply.com. “Intershop provided a robust e-commerce platform along with the hosting and support services needed,” he adds. “Their platform allowed us to customize the customer experience by adding capabilities to request quotes on any item, even those not currently shown online.”

“This is an area where the big players in the industry have a huge advantage,” Rudolph says. “More and more customers are looking to e-commerce, and smaller distributors typically don’t have the scale to compete in that arena.”

Years of Growth

DGI Supply in recent years has grown its physical footprint as well as its product and service offerings. Between 2012 and 2014, the company acquired eight regional distribution companies.

“Acquisitions are a part of our growth strategy,” Rudolph says. “In this business a good chunk of volume comes from mom and pop companies. All of the acquisitions we’ve done have involved companies with older owners who are looking to retire and need an exit strategy.”

Most of the companies acquired by DGI range in annual revenue from $3 million to $30 million. “What we did is acquired those firms, integrated their system with ours and very rapidly put them under the DGI Supply umbrella,” he adds.

The company’s acquisitions are structured in a manner that helps distribution owners transition out of the business – earning the purchased value of the company over time to minimize the tax burden, Rudolph notes. 

DGI Supply operates 30 locations in the United States, nine locations in Canada,six sites in Mexico along with 11 stores run on-site at customer locations. Groves Industrial Supply, a Houston-based distributor now owned by DGI Supply but still doing business under its original name, operates a single site that alone reports annual revenue of $65 million.

The company’s delivery strategy differs based on location. Groves Industrial Supply operates a fleet of 16 trucks that deliver daily to customers, while the Canadian operation drop-ships goods from two distribution centers as well as provides local vending machine replenishments. The company’s large U.S. markets offer full service including shipping, while smaller markets retain vendors and outside providers to deliver goods from one of seven main distribution centers.

Rudolph says he expects DGI Supply to continue to grow in 2017. He attributes the company’s growth and success to its parent organization’s focus on technology as well as its employees. “As a family owned company, we can move from an idea to a final concept very quickly – some of the acquisitions we made went from having an interested party to final purchase within 30 days,” he adds. “I feel that DoALL really has high-caliber people in its workforce, many of whom have been here for a long time. This a great place to work, and we have a lot of fun.”

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