D&H Is Tripling Warehouse Capacity In ‘Built For Growth’ Blitz

“You have not seen any other distributor in the last decade make this kind of investment in additional warehouse capacity,” said D&H Co-President Dan Schwab. “This is a continuation of D&H’s Built For Growth strategy. We’re investing for the future.”

D&H is tripling its warehouse capacity with a new distribution center in central Pennsylvania that opens the door to new supply chain services for solution providers.

“You have not seen any other distributor in the last decade make this kind of investment in additional warehouse capacity,” said D&H Co-President Dan Schwab. “This is a continuation of D&H’s Built For Growth strategy. We’re investing for the future. This is an investment in our foundation with best of breed logistical capabilities. This makes us a more cost effective and efficient distributor with new automation capabilities.”

The new 745,000-square-foot facility provides five times more configuration space to meet the demand for additional integration services for both solution providers and vendors, said Schwab. “Many of our customers are coming to us to help them scale their business because they have run out of capacity,” he said. “Think about a large reseller that has grown and run out of space. What they are doing now is allowing D&H to step in and provide those configuration services.”

[Related story: D&H Invests In New Hires, Additional Credit To Support ‘Built For Growth’ Sales Charge]

D&H’s ability to configure and drop ship directly to end user customers on behalf of their solution providers is leading to a significant cost savings for partners, said Schwab. Some partners are opting to focus on higher value added server configurations, leaving more standard configurations for D&H to ship to customers, said Schwab.

The new facility compliments D&H’s continued investment in driving its cloud computing business which grew at an impressive 160 percent clip last year, said Schwab. D&H is providing outsourced managed services for partners in addition to its MSP software offerings. Last December, the company promoted four-year D&H veteran Ryan Flynn to a new position as director of modern security and managed services.

The new D&H distribution center– which replaces the warehouse at its former Harrisburg headquarters- became operational in January.

D&H is planning a March 24 ribbon cutting ceremony for the new facility which will include a tour of the facility for local officials followed by activities for D&H co-workers.

The new facility sets the stage for continued growth for D&H which last year continued its long-running growth streak with an impressive 19 percent growth in U.S. sales, said Schwab.That 19 percent growth clip – which includes a 25 percent growth in notebook sales– put D&H over the $5 billion sales mark. Among the areas where D&H expects more than 25 percent growth this year is notebooks, servers, videoconferencing collaboration soluitions and Pro A/V and digital signage solutions.

The new facility comes with the industry facing the third year of a pandemic that has led to a supply chain crisis sparked by the increased demand for laptops and a shortage of semiconductors. “The supply chain is still very challenging,” said Schwab. “I would expect that to be the case for all of 2022. There are some vendors where we place orders and they are six months out.”

D&H, for its part, is stepping up to invest more heavily in inventory for partners in high growth areas such as notebooks, said Schwab. “We have always had a deeper inventory business model than our competitors,” he said. “D&H has always believed in having a deep supply of inventory. Most public or private equity owned distributors look at return on working capital which requires them to turn that inventory. This new facility allows us to have an even deeper supply of inventory. It also allows us to continue to be flexible for partners so that if they need us to hold inventory for them due to the uncertainty of future availability then we can do that. This gives us the capacity to increase inventory across all categories.”

The new distribution facility also comes with D&H making a concerted effort to do more business in the midmarket with large national solution providers, said Schwab. “We are investing in more sales people, sales engineers and more valued added support for partners at a time when many distributors are looking to reduce head count and costs,” he said. “We have hired 161 people since the start of our fiscal year in May and have another 50 open positions.”

D&H, for example, is adding employees to the distribution center and also investing in a new software platform to improve project visibility across the new facility for the sales team.

The 105-year-old D&H- which is 36 percent owned by D&H employees or “co-owners” - takes a longer term view than traditional distributors, said Schwab. “We think long-term, the investments we make are not for this quarter or next quarter, they are for three, four and five years out. We wake up everyday saying how do we help our customers win new business, how do we help them take costs out of the equation or how do we help them scale cost-effectively?”

D&H’s ability to take aggressive stocking positions and provide warehousing capabilities has been a critical differentiator particularly in the midst of the supply chain crisis, said Bob Venero, CEO of Fort Lauderdale, Fla.-headquartered solution provider Future Tech Enterprise, No. 100 on the CRN SP500

“D&H is more flexible and nimble than other distributors,” he said. “D&H’s ability to provide backend logistical stocking capabilities to help us meet the needs of our customers shows how forward thinking they are especially during the pandemic.”

Future Tech is a long time D&H partner, said Venero, but that relationship has become bigger and more strategic over the last several years, said Venero. In fact, he said, Future Tech’s business with D&H is growing at a double digit clip. “We do millions and millions of dollars a year with D&H,” he said. “They have progressively become more and more important for us.”

Bluum, formerly Trox, one of the top educational solution providers in the country, has also significantly increased the amount of business is it doing with D&H over the last several years because of the distributor’s superior white glove services, stocking and drop shipping capabilities, said Irving Lopez, vice president of operations at Bluum, Phoenix Arizona.

“As of 2021, D&H is our top distributor, taking a lot of market share from their competitors,” said Lopez. “There was a time when they were our No. 3 distributor, but over the last four years they have stepped up with additional sales support services. The overall customer experience with D&H has been great! D&H continues to be our number one supplier and obviously our number one partner when it comes to devices and the services they provide including white glove, asset tagging, and laser etching.”

Over the last two years, D&H has provided white glove service for more than 500,000 devices for Bluum, an $800 million educational solutions behemoth with nearly 1,000 employees.

One example of D&H’s stocking, availability and white glove service capabilities came in the last several months with one of the largest projects ever undertaken by Bluum: a 100,000 Acer Chromebook rollout to 332 locations for the Clark County School District in Las Vegas, Bluum’s largest customer, said Lopez.

D&H provided white glove service and asset tagging and then drop shipped the Chromebooks directly to the 332 school locations, said Lopez.,

“We are still in the midst of that project but it has gone great,” said Lopez. “We have completed 80,000 of the 100,000 devices. D&H has done everything from working with the school district technology department and directors for each site, auditing the enrollment process and communicating what shipment have gone out with serial number tracking so we can report it back to the School District. It has all been enrolled, asset tagged and white gloved by D&H.”

Lopez praised D&H Bluum account rep Tina Kim, a 15-year D&H veteran, for consistently going above and beyond to meet the needs of Bluum customers like the Clark County School District. “We joke around that she should work for us because she does more for us than D&H,” he said. “She makes us her number one priority and always has our back.”

Even with the pandemic supply chain crisis, Kim was able to secure 20,000 Acer Chromebooks several months before the purchase order was finalized, said Lopez. “She knew the scope of the project and what it meant so she was able to get approval to hold the inventory for much longer prior to us receiving the official purchase order,” he said. “That went a long way toward letting the customer know that the project would commence with no delays especially in this crazy logistics and back order situation we are facing. Having a partner like D&H holding millions of dollars in inventory was huge.”

Lopez said he sees D&H and Bluum continuing to work closely on large opportunities to meet customer’s needs.”I feel confident that with the services that D&H provides and our large sales force we are going to be able to conquer more projects like the Clark County School District,” he said. “I’m very confident that by working closely with D&H we will both continue to be very profitable and grow.”