Outsourcing of shipping services is a growing trend, and it is one in which Quickway Carriers specializes. The company delivers refrigerated produce and foods such as dairy and bakery products along with dry goods from manufacturers to distribution centers and retailers in the Midwest, Southeast, Southwest and Mid-Atlantic states.
Quickway says it completes more than 12,000 direct store deliveries each week with an on-time performance record in 2015 of 99.2 percent. “We record service on every shipment and every delivery every day,” President and CEO Bill Prevost maintains.
Customers of Quickway benefit from turnkey management of their shipping operations. “We are the outsource alternative for private fleets,” Prevost maintains. “That way they don’t have the capital tied up in transportation equipment or the overhead tied up in the management.”
Quickway also handles the labor relations and insurance costs associated with running a fleet. It maintains both a union and non-union workforce at different locations. Those in the upper Midwest and Mid-Atlantic states tend to have union workforces, and those in the Southeast and Southwest usually are non-union.
“The trend in outsourcing is increasing due to the increasing liability and judgment claims against carriers and accidents,” Prevost continues. “Medical costs and injuries, accidents and litigation are costing more, and we absorb that liability. We’re the low-cost provider. We run lean and efficiently without compromising safety. We can actually help the shipper with the routing, scheduling and optimizing of the delivery fleet.”
Technology and employee relations play a large part in keeping costs down. Recently, Quickway reduced a customer’s fleet of 24 trucks by six on a weekly basis through load optimization, routing and scheduling software. Quickway has taken two kinds of off-the-shelf software and added its own proprietary algorithms to it. How it optimizes its customers’ deliveries depends on the piece count and the labor those deliveries require.
“We’re activity-based in both our costing and our pricing,” Prevost explains. “What we do is we drive miles and we make deliveries. How efficiently we can work the process and collaborate with our customers and their stores to improve efficiencies drives cost out of the supply chain.”
Quickway has been owned by its employees since 2004 through an employee stock ownership plan (ESOP). “Our competitive advantage is that we’re 100 percent employee-owned,” Prevost says. “Every one of our employees has the same last name – shareholder – and they actually take ownership in everything they do. They understand that every dollar they save is putting money in their retirement trust.”
The return on Quickway’s stock has proven it to be a superior investment. “The stock has averaged an over 20 percent compound return for 11 years in a row,” Prevost maintains. “If the stock had been a $100,000 house, it would be worth $1.4 million today. It’s all because every employee shareholder has been committed to the process. We have drivers with over $200,000 in their accounts today.”
That commitment has produced efficiencies other trucking companies would envy. “We have the highest productivity and efficiency metrics in the industry,” Prevost asserts. “We have great safety and very low turnover.” Prevost pegs the company’s semi-tractor idling time as less than 5 percent and voluntary driver turnover at 13 percent.
Technology and Trucks
Quickway relies on the PeopleNet electronic onboard recorder system on its fleet. In August, Quickway won the 2015 Innovator of the Year award from PeopleNet, a Trimble company. The award is for reducing long idling time on Quickway trucks from 15 percent to 5 percent. “We’ve worked with PeopleNet making refinements and advancements to their product to enhance its operation,” Prevost says.
Approximately half of the 1,000 trailers Quickway’s semi-tractors haul are owned by Quickway. The rest are owned by Quickway’s customers. The average age of the semi-tractors is two-and-a-half years. Quickway uses a fuel surcharge revised weekly so any increases or decreases in diesel costs are passed on to the customer.
Quickway’s 709 drivers work 11-hour shifts. The semi-tractors run 13 consecutive shifts weekly and then have one shift reserved for preventive maintenance, depending on the mileage on the vehicles. Most of the company’s drivers make multiple store stops during the day and are home every night. They receive two days off every week. “The drivers have fixed schedules with regular start times and regular days off so they can build a life around their work schedule,” Prevost says.
Drivers receive health insurance and a 401(k) retirement savings plan with a 50 percent match up to 6 percent of their income in addition to the ESOP. “We like to say what we put on the back of our trucks: ‘The best driving job in America’ and ‘We hire you to retire you,’” Prevost says. “The shareholders do a great job of taking care of the customers because they get it. It’s personal and meaningful to them. We like to think we have the best of the best.”
With benefits like these, Quickway can afford to be choosy when recruiting employees. “We actively recruit, but we only select less than two out of every 100 that apply to us,” Prevost says. “Our best form of recruiting is driver referrals. We have an aggressive campaign to get our message out and we have our shareholders engaged in bringing quality people.”
The typical Quickway driver has enough experience to know a good thing when he is offered it. “Our typical driver is someone in their 40s, married with a family, who is now mature enough to see the benefit of a tremendous retirement plan,” Prevost says. “He has worked for hopefully one or two companies where he can measure us against what he has experienced in the past and realize this is the best place to invest in his future.”
Training and Safety
Quickway invests in its own system of training and has certified trainers in-house for the Smith system of defensive driving. “We utilize all the industry’s best practices, and we do everything we can to prevent accidents,” Prevost says.
Prevost plans on acquiring business in the regions in which the company already operates. It has customers who have been with it since its founding, and it is seeking more such customers.
“We can help any shipper looking to outsource his fleet,” Prevost says. “It doesn’t have to be grocery. We’re hitting two-hour delivery windows, so we can help anybody that ships to or from a distribution center to a retail store optimize and improve their delivery system. We’re always looking at where we can improve. We’re always challenging ourselves and asking how we can minimize cost and leverage efficiencies. We experiment and we try to innovate in any way we can.”