Direct Supply expansion to start by end of the year
Nursing home supplier to add seven buildings, 1,000 jobs over 10 years
-Milwaukee Journal Sentinel
Tom Daykin
June 30, 2006
Direct Supply Inc., which expects to add 1,000 to 1,500 jobs over the next 10 years, plans to begin expanding its corporate headquarters on Milwaukee's northwest side by the end of the year, a company executive said Friday.
Direct Supply, the country's largest supplier to the nursing home industry, plans to add 500,000 square feet of offices to its corporate campus on N. Industrial Road, north of W. Mill Road and east of N. 76th St.
The fast-growing company will expand by building seven multi-story buildings to link its nine existing, one-story buildings. It expects to begin the first phase of that project before the end of this year, said Bob Klein, senior vice president of administration.
Klein said plans to increase Direct Supply's current work force of 650 employees are based on the company's previous growth rate and future sales estimates. The employee-owned company doesn't disclose annual sales figures.
Direct Supply, founded in 1985, sells equipment and information systems to more than 21,000 nursing homes, assisted living centers and retirement centers. It also designs and operates Internet-based purchasing systems for its customers, and began that business in 1996.
Growth via Internet
So far, the company has focused on creating e-commerce systems for some of the nation's larger nursing home operators, including Beverly Healthcare Inc., HCR Manor Care Inc. and Extendicare Inc., Klein said. But there are many smaller operators that have not yet embraced the Internet as a way to cut their costs when buying supplies, he said.
"There's a lot more room to grow on the e-commerce side," said Klein, who spoke after a news conference formally announcing the expansion plans.
Because of the focus on technology, Direct Supply employs a lot of engineers and other professionals. Klein said more than 90% of the company's employees either have a four-year college degree or are working toward such a degree.
The new full-time jobs will pay between $17 and $25 an hour.
Mayor Tom Barrett is proposing that the city provide financing assistance for the $85 million expansion project. Under Barrett's proposal, Direct Supply would be allowed to recover $10 million to $15 million in property taxes generated by its expansion. The money would be recovered over 10 years.
Agency relocation?
Also, the city might relocate a Department of Public Works facility from N. Industrial Road to allow for further expansion by Direct Supply. The company and city would share the $9.4 million relocation costs.
Gov. Jim Doyle said the state will provide $6 million in enterprise development zone tax credits for the company.
Direct Supply's long-term expansion will be done in phases, with additional employees hired as the company's sales continue to grow, Klein said.
Speaking at the news conference, Doyle and Barrett praised Direct Supply, and its founder and president, Bob Hillis.
Skilled work force
Doyle said the company was an example of a Wisconsin business that is competing at "the high end" by selling services and products provided by a highly skilled work force.
Barrett said Direct Supply's work force of "dynamic young talent" shows that it's a company that can help replace the manufacturing jobs that have been shrinking in the Milwaukee area.
"This is a company that serves the elderly," Barrett said. "But it's a company of the future."