While it’s every carrier’s goal to grow its business, at Nu-Way Transportation it’s a reality. “We’re experiencing annual growth of 3% to 5%,” says Mike Hospelhorn, director of fleet services. “Once we have a new customer, it’s very rare that our contract is not renewed. We grow with our current base, and add customers each year. Our success is based on our equipment and our people, and a corporate culture that takes a no-holds-barred approach to exceeding customer expectations.”
Based in Bloomington, Ill., Nu-Way is an asset-based third-party logistics provider that provides dedicated carrier services for shippers across the country. Its customer roster includes everything from companies requiring a single truck to multi-state operations with larger equipment needs. Nu-Way also pulls customer trailers.
The average Nu-Way customer uses 10 to 15 vehicles and, as a whole, the fleet of 350 tractors and 550 trailers covers 28 million miles each year. Currently, the fleet includes power units from Kenworth, Peterbilt, Volvo, Freightliner, International and Mack; Wabash, Great Dane, Stoughton, Transcraft, Fontaine, Travis, Brenner, Fiba and Heil supply trailers in the operation.
Meeting customer needs
“Our fleet is based on the assets we need for specific customers, their freight volume and types of loads,” Hospelhorn explains. “It includes a mix of tractor makes and models with a range of wheelbase, engine, drivetrain and tire specs and a variety of trailers, including dry and refrigerated vans, flatbeds, dump trailers and tankers. We partner with different manufacturers based on customer needs, locations and traffic lanes.”
The average age of the Nu-Way tractor fleet is two years. Equipment trade cycles mirror customer contracts, Hospelhorn notes, and the carrier takes advantage of new technologies that offer cost, safety and fuel economy benefits. Recently, for example, specs have included automated manual transmissions, low rolling resistance tires, disc brakes and roll stability systems.
Nu-Way is also a Smartway Transport partner and works to achieve the program’s highest level of environmental performance. Its insurance company, Great West Casualty, also consistently recognizes the carrier for its outstanding safety record.
Crunching the numbers
While Nu-Way owns a large number of its trucks, it is also now leasing a percentage of its fleet to provide flexibility when bidding on new contracts. “Leasing allows us to accurately bid on a piece of business since we know what our equipment costs will be,” Hospelhorn says.
“Whenever we get an RFP for new business, we know we will need to put dedicated trucks into service anywhere in the country so we analyze what truck dealerships are in the area and what type of maintenance support is available,” Hospelhorn adds. “Then we crunch the numbers to see whether owned or leased vehicles makes the most sense for us and that customer.”
Currently, Nu-Way utilizes nine PacLease locations throughout the U.S. for leased vehicles, maintenance and repair services. The latest trucks from PacLease to join the fleet have been Kenworth T680s and Peterbilt Model 579s spec’d for specific new customer contracts. All company-owned and leased equipment is overseen by the fleet services department, which maintains working relationships with service providers, dealers and leasing franchises in all of the carrier’s operating locations. Maintenance and costs for each piece of equipment are tracked and managed in a single consolidated information system.
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Sense of ownership
“Correctly spec’d and well-maintained equipment is an integral part of our success, not only with customers but with drivers as well,” Hospelhorn states. “To help keep retention high, our drivers are also involved in the spec’ing process. We ask for their suggestions on amenities and components since they’ll be running the routes each customer requires. That practice gives drivers a sense of ownership and connects them on a deeper level with the truck, our company and our customers.”
Nu-Way also holds quarterly safety meetings with drivers to heighten safety awareness, share performance results and provide training. The company has five certified in-house instructors who utilize Defensive Driving Courses sanctioned by the National Safety Council to help drivers adjust their strategies as well as learn from one another in group sessions. Nu-Way also sends personalized safety messages to drivers on a regular basis.
At its year-end meeting, Nu-Way presents awards to its safest drivers. The carrier also has an incentive program to reward safety and reliable performance. Bonuses paid four times per year under the program also help drive up retention because they increase based on length of service.
“We also have a retention committee consisting of managers and the company president who all make follow-up calls to new drivers to ask what they like and don’t like about Nu-Way,” Hospelhorn says. “That provides tremendous feedback that we can use to improve further.”
As a result of all its efforts, Hospelhorn relates that Nu-Way’s annual driver turnover rate is less than 35%, well below that of most carriers. “Our programs, equipment and dedicated routes make it easier for us to hire and retain drivers, including a large number of teams and drivers from shippers that have transitioned from operating private fleets to using our dedicated services,” he adds.
Competitive advantage
Nu-Way customers outsource transportation and logistics services to reduce risk, streamline business processes, improve delivery productivity and flexibility, and to focus on their core business. “Dedicated transportation can provide a competitive advantage,” Hospelhorn says.
Nu-Way’s commitment to excellence has been the cornerstone of its success since Vernon Schrof, a 55-year veteran of the transportation industry, founded the company in 1994 with four cargo vans.
“He recognized the growing need for a ‘Nu-Way’ of providing customized transportation solutions,” Hospelhorn says. “His vision, which we strive to achieve every day, included creating an operation that understood dedicated transportation, supply chain management, inventory control and most importantly, customer service.
“Today,” Hospelhorn continues, “Nu-Way Transportation is big enough to be competitive, but also small enough to be nimble when it comes to providing the resources that our customers need and the most cost effective and reliable dedicated trucking services in the industry.”
