L-R Irl Davis and Tom Spencer

A/D Electronics is not a household name. In fact, the name may not be familiar to anyone outside the electronics industry. But after 20 years, the Gig Harbor-based business that has been a “best kept secret” as it expanded all over the world received the prestigious Marco Polo award in February from the World Trade Center Tacoma.

The company sells electronics components used in products like audio-visual equipment, telecommunications and cable assemblies. It does business in 15 countries and continues to expand.

“(The award) acknowledges what we’ve done and the success we’ve had in the last 21 years,” said founder and CEO Irl Davis, who on March 1 to passed the torch of company president to Tom Spencer, formerly marketing vice president, who helped build the company since almost day one.

As the two partners discussed the company’s future, they continuously gave credit to each other’s role, and to their complementary talents that brought the company from Davis’ basement in Kirkland and into the global market.

“Irl is an entrepreneur, it’s in his blood,” Spencer said.

“I contribute my success to that guy over there,” Davis said, pointing to Spencer.

Davis started A/D Electronics, with the immediate vision to go global. Spenser came on board shortly after, developing their vision further. They moved the company to Gig Harbor 17 years ago because it was a good place to raise a family.

Even from the beginning, they knew their model would work. But despite having orders lined up and a strong business plan, they got turned down by bank after bank for financing, including by the Small Business Administration. The two kept the faith, and financed the business with those multiple credit card offers that show up with the junk mail — a route they don’t really recommend to others.

Leaving the job of president to Spencer, Davis said his new role is to help the company expand internationally even more. They don’t do that by hiring consultants or taking the “ugly American” attitude of “this is how I do business,” but rather by immersing themselves into the culture and business climate of each country. Twenty years ago, that meant staying in some very non-exciting hotels because it was all they could afford — but they did what they saw as a key to their success in order to understand their international customers.

Aside from investing heavily in their customer relationships, the company invests into technology. From the first fax machine at $2,600 — which was top of the line in those days — to video conferencing so they can interact with their international clients in real time, technology has been one of the many aspects that set A/D apart. “I’d rather cheapen my salary than my tools,” Davis said.

The products haven’t changed a lot in 20 years, Davis said. What has changed is the company’s effectiveness in chain supply management. They are closer to the raw materials now by building their factories in Asia, eliminating the middleman and better controlling quality. In addition to employing about 20 people overseas, they contract with several manufacturers.

Growing means keeping every customer they got, Spencer said, and that in turn means always keeping their word, a valuable trait in many foreign cultures. For Davis, growing also means recognizing opportunities and following them, which is why he plans to spend a big portion of the year in foreign countries to expand the company market base.

One of the opportunities they embraced took the company beyond selling products and into selling services. Their formula worked, they say, and they are eager to show others how.

Called GlobalOne, this side of the company helps other businesses looking to enter international markets, no matter how small or big they are or whether they are looking to export or manufacture. “We have the expertise and we have the unique service we can provide,” Davis said, agreeing that it’s all part of the company’s continuing evolution.