Truck Topics
Expediting's Fleet Owners: Exceeding Expectations
The fleet owners of expediting play an important role in the industry. They provide expedited carriers with multiple units and they provide a vocation to those driver sub-contractors who are not in a position to buy a truck.
Simply put, a fleet owner is a truck owner who runs multiple units leased to one or more carriers. For the fleet owner, it's a way to replicate his/her own success.
Most fleet owners seem to have a similar story of how they began their business - drive a truck for awhile, put on another truck or two and go from there. Pretty simple, right?
In theory, yes. However, the fleet owners profiled here are hands-on type of people and some of them still make their living behind a wheel in addition to their duties of managing the other trucks and drivers in their fleet.
For those owners with the larger fleets, say ten trucks or more, the administration of those units becomes the job and often requires the hiring of a support staff. In the case of one fleet owner profiled here, that's a staff of around twelve people.
The task of assembling both the equipment and drivers to fill the seats is not an easy one. Obviously, the fleet owner must have the financial backing to put his/her fleet together and from the feedback from the owners profiled here, it's a time and labor intensive job.
It can be one road to success in the expediting business, however. Despite the vagaries of the economy, the fleet owners profiled in this article have indeed thrived along with numerous other expediting entrepreneurs.
Jeff Brown of Panther II Transportation's Contractor Support and Development says, "We encourage fleet owners and we'll take as many as want to sign on."
"Their trucks are dependable and they tend to remain with our company. Fleet owners handle a lot of the truck management duties including training their drivers."
"The fleet owners we deal with range from the modestly-sized operations where the owner will drive his own truck and manage two or three other trucks to operations with thirty trucks or more."
Brown says that, from the expedited carriers' perspective, encouraging a fleet owner to purchase more trucks is the best way to increase the carrier's fleet.
Brown continues, "We've built some infrastructure over the past year designed specifically for the fleet owners. This includes a driver recruiter who works with the fleet owners to keep their trucks filled."
"We also have someone in Contractor Support and Development department who deals with contractor-related questions for fleet owners - she's a direct contact for the fleet owners."
"In addition, Panther II maintains a Web Site that provides the fleet owner with immediate information about their trucks. As you can see, we built all of this support network for the fleet owner."
Joe Manley is the Operations Manager of family-owned DJ Trucking of Perrysburg, OH, and his company maintains a fleet of 25 trucks. The majority of DJ Trucking's fleet is leased to Tri-State Expedited, but the company also has five trucks leased with Landstar Express America and five with Con-Way NOW.
"We're moving into Class 8 platforms such as the FL112 and Century Class models. Our team operation trucks are setup with 300-350 hp motors and drop axles in the 46,000 GVW range. They're equipped with 84-inch or 96-in condo sleepers."
Manley explains the origins of DJ Trucking: "My brother Dave and my father, Darrell Manley became involved with Roberts Express in the early 90's, driving a truck for an owner.
"When I left the military in 1992 I went to work with my brother, going out in the truck for 2-5 weeks at a time. It was a Mitsubishi cab-over and two of the three of us were always keeping the truck moving."
"My brother and father ended up buying their first truck around 1995, a Ford L-8000. I was doing sales work at the time, but I would still go out with them and we made pretty good money."
Manley continues, "In 1995 we went to Tri-State Expedited. My dad bought a second straight truck and then a third truck. He already had a number of cargo vans from another business he was in, so he brought those to expediting and purchased even more vans. My father and brother continued to buy straight trucks as well, until they had 25 trucks between them."
"I came off the road about a year and a half ago and came into this business full-time. My brother Dave has left the business and he sold his trucks to my father."
Manley says that the economic fluctuations of the last three years have been rough and that his company is in a recovery process - but things are improving.
And, he says it's still a family operation:
"My dad is active in our business; he handles insurance, buying and selling trucks and making sure the bills are paid. I handle the computers, payroll and driver issues."
"As the Operations Manager, I also deal with our carriers. If
one of the expediting companies has a problem with one of my trucks or a driver, they call me."
He continues, "I also take the calls when driver physicals are due or when there is a DOT deadline for something. The carriers let me know when registrations are due or a renewal of some kind comes due."
"We work together," says the General Manager. "If I need a driver for one of my trucks, I call them and let them know. Sometimes they get drivers searching for an owner and they'll call me.
"One advantage for the carriers who use fleet owners is that they have another person that they can go to instead of dealing directly with the drivers."
"For example, Tri-State can call me if there is a problem with a driver or dispatch they can come to us and we will deal with it. And I always tell our drivers, if you have a problem with the carrier, and I don't care what it is, call me. If you have a problem with the company, call me and we'll go to bat for you."
"Another advantage of using fleet owners," Manley relates, "is that we train the people. We teach our drivers to be outstanding, professional expediters. If the driver has the gumption to get out there and do it, we have the knowledge to make them into fine expediters."
"We literally take people of the street with no trucking experience and we train them in the basics of trucking and expediting. We've also taken drivers from the truckload world and taught them the methods of this business."
"It's not rocket science, but expediting is unique, and it comes with it's own set of rules," Manley states. "If a team comes into this business with their own truck, it's going to take them a lot longer to become as fully productive as they can be, than if they came in with us for their first year or so. We can teach them to be among the finest expediters out there within a few short months if they apply themselves."
"I can answer their questions once they're on the road about
'should I deadhead here, or somewhere else? Do they get freight out of here? Where are the closest freight lanes?'
We can help them along to find the loads and be more profitable."
He continues, "Between all of the principals in this company, we have over thirty-five years of experience in expediting and we can really get the drivers up to speed quickly. Also, we have an effective network of drivers in DJ Trucking and if I don't have an answer for a new driver, we have someone who does."
Manley's driver retention method is a simple one: "The main thing is to pay them well, pay them on time and be honest with them. I'm upfront with my drivers and I have one standard for all the teams - no favorites. And, it's important to be consistent in how you do business with folks."
Manley says that fully half of his fleet is composed of drivers who felt that their previous truck owner was less than honest with them.
"Drivers want to know that they're going to be treated like human beings, not money making machines," says Manley. "Treat them and talk to them as humans. Respect them for who they are."
Manley continues, "We're a Christian-based organization, but we don't preach to people. We do want them to know that we're praying for them and we want them to succeed."
Manley stresses to his drivers that they are independent contractors and that he will not micromanage them - they are in their own business and their own boss.
"I certainly will help them and I want them to call us, particularly in the early stages of their business. If we can help them with their business, their success is our success. We want them to succeed as quickly as possible as well, because we want them to be happy and to stay with us."
The Husband/Wife teams are the way to go, says Manley because they're more consistent and they last longer in the business. "Besides," he adds, "they take better care of the truck."
Scott McCahan, Senior Manager of Safety and Contractor Relations for FedEx Custom Critical says that utilizing expedited fleet owners truly benefits the carrier: "The fleet owner knows time-sensitive freight and how it works."
"When you have someone who has been in the industry and understands it and when they add multiple trucks, it works for both the carrier and the fleet owner."
McCahan estimates that the FedEx Custom Critical's fleet is composed of 10 percent fleet ownership, and most of those are operations with five trucks or less.
"In years past," he says, "it was common for the fleet owners to have 6,8 and 10 trucks in their fleets. Now, it's smaller fleets. Because of the driver shortage, it's become difficult to find good quality drivers."
He adds that because fleet owners primarily do their own recruiting and training, it eliminates many contractor relations issues for the carrier:
"Our relationship is with the owner-operator, and obviously anyone he chooses as a sub-contractor is his responsibility."
Ms. Patricia Smythia is the owner of Freedom Express of Linden, TN. Her company fields a fleet of ten straight trucks (teams only) that are leased with Panther II Transportation and Tri-State Expedited Services, Inc.
She spent 19 years in management with Pilot Corporation and Truckstops of America before leaving to pursue a driving career.
Seeking new challenges, she drove a tractor-trailer for two years before she started Freedom Express six years ago.
"In the beginning, we were looking for a truck for my son Clayton to drive. I sat down and ran the numbers on tractors compared to expediting; we decided to go with expediting."
Ms. Smythia says that the biggest problem facing her business is typical of trucking: driver turnover. "It seems like the more you
grow, the bigger the problems become. It comes down to managing the business, forecasting the business trends and keeping drivers happy."
"I'm considering adding a couple of tractors. I probably wouldn't have done that three years ago, but it seems that tractor freight in expediting has grown so much."
"I have some drivers who come from truckload freight who have a hard time of making the transition into a straight truck, so this would help that situation. I'm considering stretching the big trucks and just adding a cargo box."
Ms. Smythia says that by the time she added her fifth truck to the Freedom Express fleet, the demands of managing the company forced her to leave driving behind, at least on a regular basis.
"It became very difficult to stay on the road, so I don't drive a whole lot anymore. I'm working alone in the office at the moment with my daughter helping, but it won't be long before I add a full-time accounting person."
"Even though I have a background in numbers-crunching, it's difficult to keep a trucking business profitable and you have to be a good manager to survive."
Ms. Smythia's plans for the future include adding trucks to the fleet with a goal of twenty units. She states that the company already has its own authority and could operate independently, "but it's nice to know that the freight is there when leased to a carrier. I think it's great to go out on your own, but I think you have to be totally prepared to do that."
She says that fleet owners are a valuable asset for any expedited carrier because "we provide the trucks, drivers, training and recruiting. If there are any contractor relations issues with drivers, we're involved in that as well."
In regards to recruiting: "I look for people who enjoy the business. I think they're happier and they stay longer. People who have been in expediting before are valuable to me."
She continues, "Sometimes, the drivers who come to expediting from conventional trucking have a hard time adjusting to this business. They want to run non-stop and expediting doesn't work that way - there IS some waiting time."
"I think it's best to put the big truck teams on in the third and fourth quarters. When a truck driver starts in expediting during the slower first and second quarters, they will possibly become discouraged and quit. Once they become accustomed to the way expediting works, they are more likely to remain in the business."
"Trust and mutual respect are key components in dealing with our drivers. They have to believe that I am available when they need me and that their settlements will be on time and correct."
Recruiting Supervisor Phil Weiner of Tri-State Expedited Service, Inc., says that his company welcomes the fleet owners of expediting.
"They bring us quality individuals and they help build our fleet. We don't favor them by giving them special loads or attention; they're treated as good or bad as anyone else out there."
"We know that we can count on their input and advice and they help give us feedback and direction. Our fleet owners have a major impact on our company; they supply us with a lot of equipment and we do our best to take care of them and their needs."
"For example, we have recently changed our rate structure and we surveyed the fleet owners' to make sure we were headed in the right direction."
Unfortunately, Weiner says, turnover is always a problem in expediting, particularly with those subcontractors working under a fleet owner. Because they have no financial investment in a truck, it's a common story that after training and orientation, many will take a load and then decide that the business isn't for them. This creates a loss situation for both the fleet owner and carrier.
On the positive side however, Weiner says that if the fleet owner's driver tries it for a few months, they tend to stay with expediting.
"The good thing is, fleet owners can make some money at it if they are able to maintain their fleet, treat their drivers with respect and pay them on time. The successful fleet owners like the Manleys at DJ Trucking have been around a number of years and those are the type of fleet owners we like to do business with."
Fleet owner Expedite Solutions of Indianapolis was established in 1999 with a single truck leased with FedEx Custom Critical and has since grown to a fleet of 30 trucks. General Manager Kyle Ochs (pronounced oaks) says he drove that first truck and "learned the business from the ground up."
The majority of Expedite Solutions' fleet is leased with Panther II Transportation and Con-Way NOW in addition to three other carriers.
The company operates 22- and 24-foot straight trucks. A majority of those units are 2000 or newer trucks with 72-inch double-bunk sleepers and these are equipped with refrigerators, microwaves, air-ride seats and satellite communication systems.
Ochs relates the history of the company:
"We have a sister company (OTRdriver.com) that recruits solo tractor-trailer drivers for over-the-road work. We wanted to provide an opportunity for teams who were looking to get started in the industry."
"Sometimes, tractor-trailer team OTR work can be a little scary for the wife, so we looked at the expedited industry as being a potential home for these people."
"As we investigated expediting further, we discovered that it was owner-operator driven, so the natural progression was to acquire trucks and put those drivers in them."
Expedite Solutions doesn't hire solo drivers - only teams - which the company says is ideal for single income households.
Ochs says that his two partners in the business provide leadership and financial support and management. He adds, however, that he doesn't operate the business alone.
"I have a complete support staff, with a shop foreman and his mechanics working in a two-bay shop facility," he says. "In addition, our sister company provides a high-level of accounting services. We also have a couple of driving instructors who do all of our training."
Expedite Solutions' promotional material states that one benefit is that Class B CDL training is less complicated, "which means you can complete the training and begin earning a great salary in less than two weeks."
"We've set a pretty high performance standard for our drivers," says Ochs. "In this industry, if the driver doesn't perform, no one makes any money. We've set goals of 85% or better in service time over a calendar year, 95% or better on-time performance and an 85% or better load acceptance rate."
"We monitor those numbers on a weekly basis, and for those people who aren't hitting those goals, we try to figure why they aren't achieving them."
Ochs says that when Expedite Solutions is in the first stages of the recruiting process, they make it very clear to the prospective drivers about what the company's expectations are. "If the person looks me in the eye and says, 'Yep, we'll do that', we'll give them a shot."
Ochs continues, "We invest a lot of dollars in our drivers. Not only do we help them get their CDL, but we train them in the different aspects of the business, how to relate to the carrier, the importance of being on-time, the whole nine yards."
"Beginning this year, we are offering our drivers the opportunity to participate in a lease/purchase program with stretched Class 8 trucks with a box. We've taken a lot of time and checked the numbers to ensure that it's a balanced deal in which the contractor's cash flow is better while he's paying off his truck."
Ochs says that Expedite Solutions has discovered that its policy of beginning with a rookie driver has resulted in success: "We've found it difficult for existing drivers to come in and meet our level of expectations. An experienced driver will often want to do things his exact way and that's the only way he wants to do it. It's often not the best way to run the business."
"When we get people who are new to expediting, we can teach them our way and we both succeed."
Driver retention is a struggle at times says Ochs, due in large part to the need for specialized candidates in expediting:
"We're hiring brand new people who have no idea if they will be willing to spend a long time away from home. In many cases, these couples have never been in a truck before and they go from their lives in a three-bedroom home to getting along in a 72" sleeper."
"I tell candidates on the phone that our turnover can be broken down into three categories:
"About a third come into this business as entry-level drivers and the learning curve of the job and the lifestyle is just too much for them and they just can't get it down. They're usually gone in two or three months."
"Another third of the people come in and get through their first year with us and have been successful, but they will have discovered that they don't enjoy their time away from home or they didn't enjoy trucking like they thought they would."
"The third group is what I consider 'lifers'. These are people who have found that expediting is good for them and they are good at what they do and those are the folks who stay with us. We have drivers who are coming up on their third year with us."
Expedite Solutions' General Manager says that there are specific advantages for the expedited carrier in using the fleet owners:
"With the driver turnover in the industry, a carrier utilizing the services of a fleet owner doesn't have to reinstall a truck and drivers - the truck stays with them and we can reload the truck with another team."
"Also, the carrier doesn't have the time to train the drivers or give them the personal assistance that we do."
Associate Editor Lee Kurtzmann contributed to this article.
Contact Information
DJ Trucking
Perrysburg, OH
Joe Manley - Operations Manager
888 999-7073
Freedom Express
Linden, TN
Patricia Smythia - Owner
888-593-3911
Expedite Solutions
Indianapolis, IN
Kyle Ochs - General Manager
877 230-1442