THIEF RIVER FALLS, Minn. — Oh, I can’t believe it, but here I am being a tariff expert, and I’m still not sure why it matters, but Teri Ivaniszyn, the vice president of DigiKey, is waking up in the middle of the night to do math, which is hilarious. The company ships a ton of electronic parts from a single warehouse in rural Minnesota, and it’s growing like a weed.
DigiKey gets parts from China, and tariffs are a big deal. Since 2018, they have spent half a billion dollars on tariffs, which is a lot of cash. The rules keep changing, and it’s confusing. “It’s like, what’s next? How do we handle it?” says Ivaniszyn, who can’t sleep thinking about it. The yo-yo effect is driving her crazy.
Recently, tariffs on Chinese goods went up to 145%, and it’s a mess. DigiKey gets parts from manufacturers worldwide, and it’s a headache. The supplier sends the tariff bill to DigiKey, and it’s complex. “It’s so complex,” Ivaniszyn says, throwing her hands up in frustration.
DigiKey started in a small town when Ron Stordahl, a ham radio enthusiast, sold his invention. They sell small quantities of electronic parts, and it’s a big hit. The company ships thousands of orders every day, and the town is growing because of it.
The company is in a foreign trade zone, which saves them a lot of money in tariffs. They want to triple their supplier ranks this year, which is a big deal. Other companies are interested in doing the same thing.
Tariffs are a big issue at DigiKey, and it’s a mess. Employees are pulled off their usual tasks to handle tariff-related issues. Systems break, phone calls ensue, and it’s a nightmare.
DigiKey is trying to recoup tariff expenses by using a tariff avoidance tactic, but it’s not easy. The company faces an existential dilemma and might need to open warehouses in Europe and Asia. It’s a tough decision to make.
The warehouse in Thief River Falls is massive and employs a lot of people. The town is proud of the company, and everyone knows someone who works there. The company is like a futuristic metropolis inside, and it’s a big deal.
With all the tariff chaos, DigiKey is trying to navigate the trade war like a football game in blizzard-like conditions. It’s a tough situation, but the company is trying to weather the storm.
