The Right Focus
By D.Ann Shiffler04 March 2008
Neil Perkins gives a lot of thought to what he does and to doing it right. For this reason, his company is considered among the best in the business of hauling oversized and overweight loads throughout North America.
“We are one of a few companies purely focused on specialized transportation,” he explains. “One-hundred percent of our capital and resources are dedicated to moving super loads over the highway. It's not a part of what we do; it's the only thing we do.”
But this was not always the case. The Northfield, Minnesota-based company was started by Daryl Perkins, who spent his lifetime running the business. The company was mainly a truckload carrier utilizing vans and flat-bed trailers. The younger Perkins worked in the shop during the summers.
“I never was totally engaged in the business growing up,” says Perkins, “although I always knew I had a desire to be in business for myself. It didn't matter if it was farming, or construction or trucking, just something where I owned the business and I was my own boss.” After high school he went into the US Air Force and then on to college after that. While in college Perkins worked for a concrete company. His first association with the family business was suggesting that his father talk to the concrete company about hauling some of their products. And that he did.
Soon afterward Perkins' father asked him to join the business as a partner. He joined in 1972 with the goal of learning the business from his dad, but unfortunately, the elder Perkins passed away a couple months later. “I didn't get to learn too much from him,” says Perkins.
But he forged ahead during a time when the trucking business was heavily regulated. “You needed operating authority to haul anything,” says Perkins. “A lot of our focus was obtaining operating authority.” In 1977 Perkins bought a company that had operating authority in 10 Midwestern states. This move was a milestone and growth opportunity for the small company.
Within three years the industry was completely deregulated, causing more adjustments to be made. Growth opportunity was abundant and the company grew its fleet to 120 trucks and some 160 employees by the early 1980s. The company chugged along throughout the decade until another milestone, or turning point, which refocused the company's services and strategy.
This month I was able to talk with Perkins about his company, his business philosophy and his take on the business of specialized transport. Following is an excerpt from our discussion, which I found to be interesting and inspiring.
Tell me about how a case of toilet paper led to a change in focus for Perkins Specialized Transportation Contracting. In other words, how did the company make the transition from the company your father started to the one you run today?
There have been several milestones in the company's history, like there are in most companies. One was when we purchased a company, which extended our operating authority and the next was deregulation, which caused us to go into a growth mode. At that time, everyone was out to grow market share in their respective markets. We went from 12 trucks to 120 trucks. We had a good business with good customers and good employees. But in 1988, I was in my office reviewing the year-end statement and for the amount of work we had been doing, I wasn't pleased with the results. We hadn't made as much as I thought we should have, and although we didn't lose money, I just wasn't pleased. About that time, my secretary came into my office and announced that we were out of toilet paper.
Was this something I really needed to get involved in? She explained that she had bought a case of toilet paper the day before. “So are you telling me it's disappearing?” I asked her.
I guess to me this was a milestone moment. I sat back in my chair, and in between not liking the performance of the company and realizing that someone was stealing from us, I decided it was time for a change in the business. That's when we started the methodical redirection of the company's resources from doing generic heavy hauling to reallocating our resources to doing nothing but the super load category type of work.
We basically looked at our business and got rid of the least profitable business first and began to sell off the least profitable assets, the step deck trailers, the double drops and flat beds and reallocated those resources into a very specialized type of equipment. We went from 160 employees down to 20 in 1989 and focused in on the business of extreme heavy haul.
So I guess the point is, this had nothing to do with the toilet paper, but that's when the process started. It was a point in time and recalled to me simply because that's what happened. As far as the choice, I wasn't forced to do anything. It became a point of what I'd like to be doing.
In looking at the work and what we did best and the one thing I liked the most and enjoyed the most was the larger, oversized, overweight hauling we had been doing. It didn't happen overnight but as we started to refocus it has become our only business.
What keeps you engaged in this business?
First of all I enjoy it. I enjoy it a lot. I don't feel like I even go to work. It's like going to a recreational activity every day. That goes back throughout my career. Just recently my mother asked me, “Neil why do you keep working so hard and doing what you do?”
I'm playing with trucks. Like I did in the garden dirt as a kid. It doesn't feel any differently now than it did at that time. The only regret I have is that time is marching on and there will be changes down the road.
Almost three years ago I asked my wife to find a quiet place for us to go so I could plan my career path for the balance of my working days. She scheduled us a trip on the Queen Elizabeth II from New York to London and back. I spent almost every hour on that trip planning the balance of my career – what I wanted our business to do and for the time when I am no longer engaged. It was one of the best things I've ever done. I came off the ship with a plan for the business. I have a plan and I'm on a mission to do some things with the business between now and six or seven years from now and that keeps me totally engaged.
Do you have a succession plan for the business?
Yes, that is part of the strategic plan. Sometime between now and the next six to seven years, the business will be sold. We are positioning and organizing to be a good acquisition for a larger company. There's actually been quite a bit of interest in our business, and when the time comes, it will be sold as an on-going business. It will not be kept in the family. The next generation of company management is already on board and will be running the business. We have a good company to sell, it's just a matter of when.
What are the biggest challenges to running your business?
Trying to figure out how to get this crystal ball to work – that's the biggest challenge. The crystal ball came with lot of detailed instructions, predicting where the market will go. It's an ever-changing scene out there. Is it wind power, ethanol, power plants? The market is always in a constant state of change. Choosing which wave to ride is one of the most challenging things there is to do. We have a fairly large appetite for super loads and major investments in equipment and personnel to do the job. You want to have steady sources of work – minimizing business peaks and valleys – trying to get that crystal ball to work is the biggest challenge for me.
What is the most memorable job that comes to mind in your career?
If there was a job that absolutely was in that category it would jump out and it didn't. We've done many interesting jobs over the years. There's not one I'd identify as most memorable. I think that it's yet to come.
How has the business of specialized transport changed? What are customers looking for in a heavy haul company?
Customers are the driving force that keeps raising the bar for heavy haulers and I feel we have positioned ourselves well to meet their demands. I think the time has finally arrived where customers due diligence requirements have started flowing down to trucking companies. For years buyers of crane services have stated in contracts that vendors cannot lift more than 85% of crane chart capacity. Until recently, this type of directive has not been a part of equipment and operations provided by the trucking industry but we're starting to see it more often.
In the crane business the customer often tells the contractor by what standards they want the work done and we're seeing that more and more in transportation. Personally I welcome it and I think it's a good thing for the industry.
What do you think distinguishes your fleet and your services in the heavy haul market?
We are one of a few companies purely focused on specialized transportation. One-hundred percent of our capital and resources are dedicated to moving super loads over the highway. It's not a part of what we do – it's the only thing we do. We think that distinguishes what we do from those that do a combination of cranes and rigging and transportation and super sized loads mixed in with other transportation.
It's not uncommon for us to receive a packing list with 100 items and we'll pick the one or two that fit our scope of service and quote those items only. We do not broker out the smaller loads. We're better off leaving that type of work to the experts in that field and we focus on the big items.
I think a lot of our customers have a good understanding of the role that we play and respect us for the effort we put into just the super loads. We are not going to haul the other 98 loads because it will dilute our resources and time to do the big loads correctly. We feel super loads require an extraordinary amount of attention to detail, and we can't dilute these efforts.
What would you say is the niche of Perkins Specialized Transportation Contracting?
Perkins certainly isn't alone in the specialized transportation business, there are some very good competitors in the market, but generally we try to stay in a market niche that has a limited number of players qualified to do the business. Our company is technically and operationally very strong and we focus on business opportunities that maximize the use of those resources.
Our market niche is small and our marketing efforts have to be laser focused on finding opportunities that fit our mission. Our marketing department does a great job finding and contracting business that capitalizes on our abilities to design, engineer and execute professional transportation solutions.
Perkins engineering capability includes 3D modeling, finite element analysis, and other highly technical features that allow us to present professionally engineered plans to our customers. With over 4,000 different equipment configurations to choose from, our engineers are able to optimize the equipment design for every move.
After a project manager has detailed an approved transportation plan the Perkins operations department is charged with its execution. The niche we are dedicated to serve requires highly trained and experienced personnel to safely execute on challenging projects.
All of our services are supported by equipment maintenance, fabricating, MIS, and financial departments that are all focused on one thing: oversize loads.
So what's Perkins' niche? it's easy – moving stuff that's hard to find, difficult to organize, risky to move, has elevated customer expectations, and pays the bills.
What gives your company an advantage?
It's probably our unified focus on what we've chosen to do in specialized transportation. Everyone in the company knows exactly what our business is and what the vision is for the future. There are no gray areas.
We've established a professional business culture and environment that attracts and retains great people. We've got an experienced talent pool to advance our business and they're all headed in the same direction.
Our customers and our work force have high expectations when it comes to a safe working environment. Safety is a part of our culture and is reflected in our record. One day of lost time has been recorded since 1985 for a finger injury. We can't un-ring that bell but we can do better. Safety is an advantage.
Attorney expense for the last 22 years totals less than $5,000. I think this figure says a lot about a companies' business culture. This is an advantage. And, good customers that have continued to place their business with Perkins for many years.
What's the best business advice you can offer the next generation of leadership in the company?
I'm not sure I can call it business advice. I have a simple philosophy that life isn't all that difficult and neither is business. Just always do what you know is the right thing to do and things will always work out fine.