The ‘Other’ Quiet Company

Last updated on May 13th, 2019 at 02:36 pm

Five generations and nearly 150 years after its founding, the F. Dohmen Co. continues to flourish and may soon outgrow its Germantown headquarters. F. Dohmen Co. is one of the oldest and largest privately held companies in Wisconsin, but you wouldn’t know it by the firm’s low-key corporate persona.

The small pharmaceutical wholesale business that Frederick Dohmen started in Milwaukee in 1858 with a $400 capital investment has grown into a firm with more than $2 billion in annual revenue.

Last year, the company purchased 60 acres of undeveloped land north of Freistadt Road, just outside of the industrial park where the firm is located today at W194 N11381 McCormick Drive. The company acquired the vacant land for its future facility needs.

Eventually the company may build a new headquarters facility there, according to president and chief executive officer John F. Dohmen.

For the moment, the pharmaceutical wholesale company will continue to bust at the seams of its 125,000-square-foot building. About 30,000 square feet of the building is used for office space, and the rest is used for distribution space.

"We are particularly tight on office space," said executive vice president Robert C. Dohmen.

"We’re feeling more pressure on this side (office) of the wall vs. the distribution side of the wall," John Dohmen said. "We’re probably looking at a couple of years (before anything is built)."

The process of developing the land has been slowed down a bit by environmental issues with wetlands and the Butler’s garter snake, a protected species in Wisconsin that has delayed some developments in the state.

The move to the new site would not be the company’s first move.

The company was founded in 1858 by Frederick Dohmen, a German immigrant who was trained as a pharmacist before coming to America.

Looking for a city to make a home and start a business, Dohmen considered moving to Minneapolis, but he thought the Twin Cities were too cold. He also considered Chicago, but thought it was too swampy.

In the end, Dohmen thought Milwaukee was a better place than Minneapolis or Chicago to start his company.

"In Milwaukee, he felt very much at home and comfortable, especially with so many German people here," Robert Dohmen said.

Frederick Dohmen started a small pharmaceutical wholesale and retail business on Water Street in the Third Ward in Milwaukee. Early on, Dohmen dropped the retail part of the business, but the wholesale business grew.

In 1883, Dohmen bought out his two partners, and the company was incorporated as F. Dohmen Co. Wholesale Druggists.

The biggest threat to the company’s survival came in 1892, when a fire destroyed the F. Dohmen Co. building and hundred of others in the Third Ward.

"At that time there was tremendous litigation and court cases concerning the many insurance companies arguing how they would settle out all of the claims against them," Robert Dohmen said. "It went on for years. If it would have gone against F. Dohmen Co., that would have been the end of the company"

However, the company received the insurance money it was due and rebuilt at the original location.

Frederick Dohmen never retired, but he died in the late 1890s.

The F. Dohmen Company’s headquarters remained on Water Street in the Third Ward for almost 100 years. In 1954, the company moved to South 13th Street and West Cleveland Avenue on Milwaukee’s south side.

"It gave us much more expanded warehouse space at that time," Robert Dohmen said.

In 1980, the company moved again, this time relocating the headquarters to Germantown. The company also continued to use the 13th Street property in Milwaukee until 1993.

Today, the firm has eight facilities: the Germantown headquarters; a facility at N114 W18850 Clinton Drive in Germantown for the headquarters of its DDN (Drug Distribution Network) division; a facility at 724 Elm St. in West Bend for its RESTAT division; wholesale distribution facilities in Anoka, Minn., Simpsonville, Ky., and Birmingham, Ala.; and DDN distribution facilities in Memphis, Tenn., and Ontario, Calif.

Germantown has been a good location for the company’s headquarters, Dohmen executives say.

"We do like the area," John Dohmen said. "Logistically, it works out very well for us for transportation and access to our market."

After almost 150 years in southeastern Wisconsin, the company is committed to remaining here, the executives say.

"We would always remain in the Milwaukee area," Robert Dohmen said. "We are tied very deeply to a cultural heritage of Milwaukee for five generations. We’re a real Wisconsin company."

Cousins John and Robert Dohmen are the fifth generation of the Dohmen family to run the company.

Unlike some family-owned firms that struggle when later generations take over, F. Dohmen has flourished as its ownership and management have been passed along from generation to generation.

The company’s current executives would like the firm to remain family-owned and operated, but they will not put any pressure on the next generation to do so, said John Dohmen, who has a 12-year-old son and an 8-year-old daughter.

"That would be terrible for them to have to live with that burden," he said. "That’s not healthy. (Running the company) has to be a self-determined intent on their part."

John Dohmen said he wants to make sure his children get a good education so they will be able to run the company someday, if they so choose. However, if they do not have the drive and the desire to take over the firm, it would not be in their best interests, or the company’s, for them to do so, he said.

"Desire is an underlying element," John Dohmen said. "That has to be there."

Today, 90 percent of the company’s business is in pharmaceutical wholesaling, and 10 percent is from its other divisions (see accompanying box).

Although pharmaceutical wholesaling is such a large part of F. Dohmen’s business, company executives are not counting on that alone to sustain the firm’s growth in this century.

The company has worked for the last 30 years to diversify its business.

"Some of that was a result of seeing the writing on the wall in response to margin erosion (for pharmaceutical wholesaling)," John Dohmen said. "We’ve always seen strength in not keeping all of our eggs in one basket."

F. Dohman Co. will continue to look for opportunities to acquire companies that fit within its health care niche, the firm’s executives said.

"Our intent is to control the development of our portfolio, ensuring we do not stray too far away from our core competencies," John Dohmen said.

The company has 700 employees, including about 300 in Wisconsin. Its workforce may increase dramatically if the company makes additional acquisitions, John Dohmen said.

"We’ve really looked ahead of the curve, not being afraid to look into new opportunities and build ourselves up," Robert Dohmen said. "That’s been a great strength of the F. Dohmen Co. over time. We have changed, we have evolved. The fact that we’ve been around for 150 years shows that we are not set in our ways. We have a tradition of innovation."

F. Dohmen Co.

Headquarters: W194 N11381 McCormick Dr., Germantown
Web page: www.dohmen.com
Number of employees: 700 total, 300 in Wisconsin
Established: 1858
Annual revenue: $2.1 billion

F. Dohmen Co. Timeline

  • 1858 – Founded by Frederick Dohmen
  • 1883 – Dohmen bought out his two partners and the company was incorporated as F. Dohmen Co. Wholesale Druggists.
  • 1892 – Third Ward fire destroys F. Dohmen Co. building. Eventually the firm collects insurance claim and rebuilds.
  • 1954 – Moved to South 13th Street and West Cleveland Avenue on Milwaukee’s south side.
  • 1977 – Started Aim-Rite division, now known as JASCORP. The division makes software for pharmacists to coordinate the doctor’s prescription with the patient’s health benefits plan.
  • 1980 – Moved to Germantown.
  • 1985 – Created the RESTAT division, a prescription drug benefit management service for employers.
  • 1992 – Created DDN/Obergfel division, a pharmaceutical logistics firm
  • 1997 – Formed a partnership that ultimately led to the creation of Walsh Dohmen Southeast, a wholesale pharmaceutical distributor.

Key Washington County Projects

  • Sidney, Neb.-based Cabela’s Inc. will build a 165,000-square-foot outdoor gear store on a 60-acre site at U.S. Highways 41 and 45 in the Town of Richfield. The state is providing $5.25 million for road improvements and the county is providing $4.5 million for the development. The store will open this fall.
  • Developer Robert Lang is building a world-class golf course called Erin Hills on 560 acres near Holy Hill in the Town of Erin. The golf course will open this summer.
  • • A $90 million redevelopment of the former West Bend Co. manufacturing complex in downtown West Bend is transforming the site into a new neighborhood with condominiums and commercial space. A new YMCA opened recently in the development.
  • Wal-Mart is building a 200,000-square-foot Supercenter store at the southwest corner of Appleton Ave. and Maple Road in Germantown. The store will replace a standard Wal-Mart store in Menomonee Falls.
  • Wal-Mart is also planning to build a 180,000-square-foot Supercenter store north of Highway 60 and west of Pond Road in Hartford.
  • Empyrean Holdings Inc., a Houston-based national real estate holding company, and its business partner, the United Construction Group (UCG) of Sacramento, Calif., are developing a $50 million mixed-use commercial real estate project in Kewaskum. The project will include mixed retail, commercial and residential development.
  • Aurora Health Care plans to build an 80,000- to 100,000-square-foot ambulatory surgery clinic on 60 acres northeast of Highways 45 and 60 in Jackson. The clinic will replace Aurora’s current 6,000-square-foot clinic in Jackson.
  • Aurora is also building an 88,000-square-foot clinic north of Highway 60 and east of Hilldale Drive in Hartford.
  • A 120-room Baymont Inn & Suites hotel and conference center will be built by Waukesha-based M&M Real Estate LLC and Waukesha-based The Dove Group at the northeast corner of Highway 41 and Highway 60 in Slinger.
  • Nostalgic Times LLC will develop Reflections Village, a 114-acre mixed-use development at the southwest corner of Holy Hill Road and Highway 41/45 in Richfield. The nostalgic-themed community will have 114 single-family homes, about 40,000 square feet of retail space and about 80,000 square feet of office space.
  • Advanced Healthcare plans to build a 75,000-square-foot headquarters at the southeast corner of Mequon Road and River Lane in Germantown.

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