Farnell will arrive at electronica 2022 in Munich next week with a spring its step following a record $1.8 billion revenue year, and a raft of investments to enhance customer experience.
Prominent among those investments is a now up and running $100 million, 360,000 square feet distribution centre in Leeds, which will enable Farnell to meet increased demand and adds the capacity to increase inventory.
“We have enjoyed a market share pick up,” says Chris Breslin (pictured), Farnell President. “Now Farnell represents seven per cent of Avnet income, and 25 per cent of average income margin.”
“That’s important because Farnell is an ecommerce business,” he stresses. “High margins drive performance and raise the cash for investment in the company.”
Farnell has addressed the issue of Farnell’s ageing Leeds headquarters with a £6 million refurbishment. Working conditions are more comfortable with improved lighting and air conditioning, and a new restaurant area includes a Costa Coffee stand.
The offices are designed to embrace changes in the ways that employees now work at Farnell, with a mix of full-time office occupation and hybrid homeworking.
ERP and SAP platforms have been integrated into Farnell creating new jobs.
Inventory has been beefed up and Farnell will hit its target of 250,000 new SKUs by the end of this year. This will be followed by a $500 million investment to double inventory over the next three to four years as Farnell aspires to be a $3 billion company in the next three to four years.
Breslin estimates 80 per cent of the new inventory will come from existing suppliers. The rest will be met by new franchises enabling Farnell to expand its semiconductor, passives and IP&E offering.
“We will grow our industrial automation business too expanding content from existing suppliers and augmenting that with new lines,” adds Breslin.
Breslin is also chipper about Multicomp Pro, Farnell’s own brand business that grew 18 per cent in 2021.
“There is a strategy in place to grow the business, though not by cannibalising our suppliers business,” he emphasises.
“There is a lot of scope there,” Breslin continues. “We will invest in more own brand passive components, safety equipment, and off board products including test and measurement and tools.”
A marketing campaign is underway offering customers a 30 per cent saving on production supplies including solder, chemicals and ESD products.
New skills are being added to Farnell’s technical support team as the company grows its test and measurement offering.
The ability to sell software has been honed because of a recent exclusive global agreement with test and measurement supplier NI.
“NI has trained our team on software applications”, says Breslin, while affirming that the company is hardware and software agnostic with both Keysight Technologies and Tektronix on the test and measurement roster.
In addition, more opportunities are springing up around Raspberry Pi.
“We will continue to support their products and definitely see more applications and opportunities as Raspberry Pi penetrates the microcontroller market.”