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A Spin Off Logistics Firm Is Doing Well
COOPERSVILLE — Trucking is merely a part of logistics, but one regional trucking company has spawned a new entity that specializes in solving broader logistics problems for some of its parent company's clients.
The corporation, which celebrated its second birthday last month, is Foreway Management Services (FMS).
FMS operates out of the same Coopersville offices as Foreway Transportation, an over-the-road trucking firm that is three decades old.
And according to Pam Hassevoort, the president and CEO of both entities, the services Foreway Management offers arose out of 20-plus years of experience that she and her two brothers have in the trucking business.
She explained to the Business Journal that the idea of logistics grew more or less by evolution.
The seed was planted much earlier in the company's existence thanks to the practice of having the Foreway representatives work on site at clients' docks to coordinate the work of Foreway's drivers with the client company's shipping and receiving personnel.
Over time, Hassevoort said, such representatives and their client co-workers jointly invented shortcuts and simplifications that enabled both firms could save time and money.
The feedback enabled Foreway to implement similar expedients which that benefited other clients and, in so doing, helped buttress and cement Foreway's reputation for service with those clients.
But over time, Hassevoort says, the trucking firm saw opportunities to expand tweaking as a form of good client service into an analytical specialty which reveals and solves problems just about anywhere in the supply chain.
In one instance, a major local manufacturer that uses Foreway as a shipper — Bissell Inc. — wound up retaining Foreway to provide switching service, too. In the trucking industry, switching service at a set of busy loading docks is the same never-ending and administratively complex hassle as switching in a freight yard, but without the steel tracks.
"Trucking is pretty much a case of figuring a quote to haul a load from Point A to Point B," Hassevoort said. "And for us, logistics is a case of managing the entire process to get the client the most cost effectiveness."
For a firm such as Eagle Ottawa, in Grand Haven, she said that means FMS simply manages the client's own trucking fleet.
"They have a private fleet," Hassevoort explained, "but their management decided that they wanted to focus on their core competency. They didn't want to manage a trucking business any longer, so they asked us to do it for them."
In yet another case, Hassevoort said, FMS shops the trucking industry for the best possible rates for shipments out of the Sappi Fine Paper mill in Muskegon.
Hassevoort explained that in recent years, Sappi — a multinational headquartered in South Africa — has created distribution centers all over North America. The idea is that each mill will delegate most fulfillment work to the centers.
"The Muskegon mill, for instance, no longer ships to Maine or vice versa," Hassevoort said. "Instead, they ship about 80 percent of their paper to the distribution center in Chicago, and then that center takes over from that point."
But she explained the shoreline mill still wants to get its high-grade paper to Chicago at the lowest possible price per ton.
"And we help them find the carrier that can do that," she said, "just like we do with the other 20 percent of their paper that they ship direct."
To make sure the Sappi price is right, she said, the 18-member staff of FMS focuses on finding truckers that are headed home to cities that happen to be Sappi destinations.
"There's an old saying in the trucking business," she said, "that 'The horse runs fastest when it's headed back to the barn.'
"So we're looking for drivers who are headed home and will get their Sappi loads there more quickly."
What's more, she said, because trucks that are headed home usually are empty, their owners often will discount their fees in order to have a paying load, "so the client saves money and the trucking company saves money."
FMS so far has six clients — the other three are outside this region.
Hassevoort said that in most cases the clients are logistics works in progress.
She explained that, ideally, FMS would like to go to a new client and ask for total access to their operations.
"Then we'd analyze it and customize a logistics solution for them." The firm has a proprietary software program that helps it analyze client companies' logistics costs.
But at the start, the process sometimes isn't nearly so comprehensive.
"At first," Hassevoort said, "some clients are pretty intimidated about opening up to us like that. So we'll just work on, say, an in-bound solution for them.
"And once we get in and they start to recognize the savings and that we're helping, then we can expand to the out-bound solution, and over time we can do even more."