Business Profile: DCL in Fremont is a Key Link in Supply Chain
The following is from the San Jose Business Journal published on July 3, 2009:
THE BUSINESS: DCL Corp. provides final consumer assembly, warehouse management, shipping and other fulfillment services. The company’s clients are consumer, electronics, health care and software companies. DCL is an outgrowth of DisCopyLabs, which provided duplication services to the software industry, which DCL still does in a small amount.
CUSTOMERS: DCL has about 40 clients, including Sirius XM Radio Inc., Altera Corp., Johnson & Johnson, Symantec Corp. and Bio-Rad Laboratories Inc.
SHORT-TERM GOAL: Managing the company through these tough economic times. The challenge is how to manage costs and people and work with customers who are having cash problems. The economic troubles started for the company 10 months ago, and CEO Norman Tu says he doesn’t see a recovery happening until the second half of 2010.
LONG-TERM GOAL: DCL is in 310,000 square-feet of space split up between two facilities in Northern and Southern California. The long-term goal is to grow along with its clients needs, eventually opening a facility on the East Coast.
BIGGEST COMPETITORS: DCL competes with traditional manufacturers, warehouse and electronics companies and printers. Some example are Flextronics International Ltd. and Menlo Logistics.
SOMETHING ABOUT THE BUSINESS THAT MIGHT SURPRISE PEOPLE: Tu started the company in a 1,000 square foot space above a beauty a parlor in Menlo Park. He could smell the beauty parlor chemicals.
HOW WILL THE BUINESS CHANE IN FIVE YEARS: The distributor will play less of a role in the supply chain because of the Internet. Tu's business is 50 percent distributor, 25 percent to retailer and 25 percent to consumer. In five years he expects to be 25 percent to distributor, 25 percent to retailer and 50 percent to consumer. An example of the direct-to-consumer model is Amazon.com.
BEST BUSINESS DECISION: Not investing money in the DVD and CD-ROM business, which would have been the natural progression for DisCopyLabs. That business is very capital intensive, and a company has to be a big player to make money on it, Tu said.
TOUGHEST BUSINESS DECISION: Reinventing DisCopyLabs in DCL. In 1992 the company was copying 50 million floppy disks. Today it does at most 100,000. DisCopyLabs' competitors are no longer in business, Tu said.
LIKE LEAST ABOUT THE BUSINESS: The supply-chain business is not very sexy. The business also faces an extreme time demand - the typical shipment, if Tu receives an order by 1 p.m., it is out the same day. After that, it is out within 24 hours. The business has big surges - as in the last few days of the month, when customers are eager to get orders out. Tu has to plan his capacity and people accordingly.
ONE THING THAT MIGHT SUPRIRSE PEOPLE ABOUT THE CEO: Tu is "The Joy Luck Club" author Amy Tan's first cousin. One of the stories in that book is about the Tu family. Also, on the cover of Tan's "The Bonesetter's Daughter" is a picture of Tu's paternal grandmother.
About DCL
Since 1982, DCL has been a leading provider of outsourced manufacturing and logistics services for technology industries. Its customers include electronics, software and healthcare companies. DCL's business-to-business services include order processing, project management, packaging and assembly, fulfillment and distribution, inventory management and warehousing and returns management. DCL is ISO 9001-2000 certified, EDI, RFID and MRP/ERP enabled for on-line, 24/7 visibility to production, inventory and shipping information.
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