Previously in this series: Other expansion challenges: Insurance costs, administrative/compliance burdens, managing customers
Young fleet CEO Marco Ardila didn’t exactly set out to run his family’s small trucking business. Yet that’s where he found himself after the company got overextended after a series of misfortunes during the long expansion of his Uncle’s one-truck business, begun more than 12 years ago.
“I don’t drive trucks,” he says. “My background is as an industrial engineer. I’m just trying to help my family as much as I can.”
The Miami, Fla.-based company, Firstway Logistics Trucking, after aggressively selling some assets to improve its financial position, sits now at 10 trucks and 15 trailers, down from 30 trucks around 2011-12. But the company currently employs only five drivers, says Ardila. Having five trucks and about 10 trailers sitting idle led Ardila to the relatively new COOP by Ryder program. It’s in operation in his area and the Atlanta region, with plans to expand throughout Florida by year-end.
Ardila calls COOP by Ryder a kind of “Airbnb for the trucking business.” While fleets leasing or renting equipment from other fleets is nothing new, online equipment rental marketplaces are. One might not expect to see a new sharing platform come from a company already in the equipment rental and leasing business, as this would only increase the competition. Yet that’s exactly what Ryder — a commercial fleet management, dedicated transportation, and supply chain solutions provider — did by launching COOP first in Atlanta.
The expansion to South Florida early this year brought a new revenue stream to Ardila and company. On Jan. 5, the company began renting assets to carriers through COOP. The first transaction was renting three reefer trailers for three days. This led to a rental contract of five trailers for 20 days. More contracts followed.
Firstway Logistics’ rental revenue is about $128 dollars a day plus $0.12 per mile for trucks. Reefer trailers go for approximately $69 a day plus $1 per hour for run time, he says. “I think COOP is definitely helping to sustain the business” at this point, Ardila says.
As small fleet owner-operator Daniel Davidson’s 20-truck Davidson Trucking fleet has expanded over decades since he started in the late 1980s, it now has a solid warehousing component to the business that itself started with renting space in three or four storage trailers. Responding to additional demand for space, the company in the late 1990s built a 12,000-square-foot warehouse that “was full before we got it completed,” he says.
In 2000 the company expanded it to the current 52,000-square-foot facility. Davidson rents space in it and utilizes it to help organize less-than-truckload loads. “That’s been a big part of our being able to generate extra revenue – piecing loads together” in the warehouse, Davidson says. –Aaron Huff contributed to this report