Gradual Diversification Increases Carlson Growth Over Four Decades
Aug 1, 1998 12:00 PM
Roy N Carlson Inc, a foodgrade products carrier, has grown over the past four decades through gradual diversification from dairy products into edible oils, honey, vinegar, sugar, and flour.
"As the dairy market began to change, we knew we needed to get into something other than hauling milk," says Bruce Carlson, vice-president operations and logistics.
Bruce and his brothers, Jerry, president, and Corky, secretary-treasurer and fleet director, operate the Stanwood, Washington, company established in 1959 by their father, Roy N Carlson. The business started with one 1947 milk trailer and a 1959 GMC tractor.
By 1961, the company boosted business by adding Northwest Independent Milk Producers, a Washington farmer cooperative, to the list of customers. At the death of their father in 1971, the sons took over the business and gradually expanded to today's fleet of 45 trailers and 30 tractors.
Bruce handles dispatching for oil and dry bulk shipments while Jerry dispatches for milk routes. Corky directs all maintenance procedures and equipment purchases. Bruce supervises license and insurance requirements and recruits new business opportunities.
Although diversifying the range of edibles hauled, the owners remained focused on the northwestern region of the United States and the southwestern region of Canada.
"Foodgrade hauling fits our way of conducting business," says Jerry. "We feel confident that by specializing in this industry we can provide the best services for our customers. In this specialty, there are few opportunities for backhauls. We knew we didn't want to expand outside our region. We did not want to run those empty miles."
The first opportunity for expansion from dairy products to foodgrade oils was presented to the company in the early 1980s, says Corky. A ship carrying soybean oil required emergency offloading while moored an hour south of Stanwood in the Port of Seattle, Washington. Drums of soybean oil and other cargo had been thrown together during a storm. Seeking several carriers to haul the mixtures to a Seattle re-refining plant, the shipping company contacted the Carlsons on the recommendation of a mutual customer.
"We put two trucks on and were lapping other companies' trucks," recalls Bruce. Three weeks later, their ability proven, the company purchased a new trailer and entered the foodgrade oils business fulltime.
At about the same time, the company was recruited by area food processors to haul honey and vinegar, a smaller but continual market. "Occasionally, we handle juice concentrate," says Bruce.
In 1996 the Carlsons again diversified with the design of a specialized two-compartment dry bulk trailer to attract business from a Portland flour mill. Dry bulk trailers carrying 70,000 pounds of cargo can be loaded or unloaded in two hours. Corky, an engineer, took a close look at what the market demanded and worked with the manufacturer to achieve volume capability while staying within weight requirements. Similarly, the decision to divide trailers into two compartments added one more efficiency. "When you are a small business, you have to adapt," says Corky. "We wanted to utilize aluminum on trailers as much as possible in order to handle weight limits."
Having succeeded with entering the bulk market, they were ready when a situation arose in 1997 for the company to haul beet sugar. A food processor who was displeased with delivery of sugar via rail chose Carlson Inc to step in.
Today, the company operates five dry bulk trailers and has another on order. Sugar is picked up in Oregon and Idaho and delivered to food processors in the Seattle and Portland, Oregon, areas. Flour, to be converted into packaged products, is hauled to processors in Seattle and Portland from as far away as Idaho.
Longer distances are involved in some of the transportation of foodgrade oils, although 98% is delivered in the local area. Tank trailers are loaded in the Seattle and Portland areas where product arrives by rail and then is moved to food processors for delivery. A segment of transportation requires short trips of 150-200 miles from Stanwood, plus extended trips of 1,000 miles into surrounding states and British Columbia and Alberta, Canada.
Gradual Development Despite diversification from milk to other foodgrade products, a major part of business still comes from the dairy industry, both at the farm and in manufacturing. "It has been a gradual development," says Bruce. "Markets are limited here. We address a specific niche market in this northwest region."
The company has tank trailers, used as doubles, dedicated to milk transport. Like many other areas in the United States, small farms have gone out of business, reducing overall milk production. Larger farms that Carlson Inc serves have remained in production, some supplying 100,000 pounds every other day.
"We've done all right in milk," says Jerry. "We've been very fortunate that we haven't lost any volume."
In addition to local hauling, Carlson Inc picks up milk in locations 70 miles to the north almost into Canada, 90 miles to the south, and east from Stanwood.
Raw milk hauling often presents difficulties for drivers, especially when roads leading to farms are flooded or deep in snow. High winds have covered tractors and tank trailers in drifting snow. On one occasion, a driver narrowly escaped disaster when his vehicles were caught in a flash flood. Freezing temperatures stress hoses and other equipment, which intensifies maintenance and repair schedules.
Besides farm transport, dairy processing brings opportunities for Carlson Inc to haul whey, buttermilk, and cream. Two double-tank trailers are dedicated for interplant milk movements at dairy plants in Issaquah and Chehalis, Washington, where increased production has added to the Carlsons' business.
Rigorous Regulations To expedite shipments into Canada and adjacent states, the company requires equipment and drivers to meet the most restrictive regulations of the area. "In western Canada, lift axles are not allowed. If we weren't in compliance, Canadian authorities would remove wheels and chain up the lift axles," says Jerry. At the same time, Canada's regulations allow longer driver hours than are permitted in the US. Nevertheless, Carlson Inc drivers follow US restrictions.
The company employs about 40 drivers. "Drivers pretty much retire out of here," says Corky. "Low driver turnover is one of our strengths." Because the majority of routes are close to Stanwood, drivers are seldom away from home for long periods. As a result, there is little need for recruitment. Drivers receive cargo loading and unloading training from Corky. They carry cell phones for communication with dispatchers. Carlson Inc provides them with coveralls to protect their clothing while on the job.
As the company employed more drivers, and as equipment was added, additional space was needed for offices, shop, and a wash rack. A new terminal building was constructed on site in Stanwood in 1994.
In the two-bay shop where all repairs and inspections are conducted, Corky oversees work. The 100-foot-long bays provide enough room for tractor-trailer rigs. Corky and two mechanics conduct maintenance and inspections, including 10,000-mile maintenance schedules for tractors.
The 30 Peterbilt tractors in the fleet are usually operated for 10 years. "They stay with us for a long time, are easy to work on, and less expensive to maintain," says Corky. "They range in mileage from 140,000 to 200,000 miles, with some tractors reaching 240,000 miles per year. We'll keep tractors closer to home as miles get higher." The carrier has standardized on Peterbilt tractors with Cummins 400-435 horsepower engines, nine-speed Fuller transmissions, Rockwell drive axles, and Holland Hitch Co fifthwheels.
Two service trucks are available for on-the-road emergency repairs.
Similarly, tank trailers receive maintenance on a regular basis to keep them in good condition for sanitary requirements. The Carlsons also like the equipment's appearance to project a positive image for the company. They emphasize clean exteriors in spite of wear from weather and road conditions.
Adjacent to the maintenance shop is a tank cleaning bay that houses an interior tank cleaning system with a Cleaver Brooks 50-horsepower boiler and Chemdet Fury II spinners. Detergents used include Ecolab Liquid Spearhead for flour trailers; Klenzade Bevro-Sheen foodgrade caustic for trailers that transport edibles such as oils; and Wesmar Co Inc Lustre Plus for milk trailers. Lustre Plus is also used for exterior tank cleanings.
Sanitary trailers used for dairy products have clean-in-place (CIP) systems spray balls by Klenzade to facilitate washing at manufacturing plants after every unloading. The 27- to 29-ft trailers are supplied by Brenner Tank Inc and Beall Corporation. Double-trailers range in capacity from 4,500 to 5,000 gallons. The LC Thomsen Inc Number 8 pumps can move 2,500 pounds of product per minute. A 25-foot jumper hose stretches between trailers.
Carlson Inc also prefers detachable clamp fittings for the 25-ft hose used for farm pick-up because they are easily cleaned and replaced. Hardware includes Thomsen valves, Run-O-Vent vents, and Reyco Industries Inc and Hutchens Industries Inc suspensions. Aluminum wheels are from Alcoa Wheel Products International and Accuride Corporation.
Single Trailers Tank trailers used for foodgrade oils are from Brenner and Bar-Bel and vary in capacity from 7,000 to 7,200 gallons. The vessels' six-inch insulation works in conjunction with in-transit heat delivered from tractors. Trailers are equipped with Ibex and Thomsen Inc pumps, Thomsen valves, Reyco Industries Inc spring suspensions, and Alcoa and Accuride aluminum wheels.
Dry bulk trailers for sugar and flour transport are manufactured by J & L Tank Inc. Gross combination weight when loaded is 105,500 pounds. The four-axle trailers have a capacity of 2,600 cubic feet and are some of the largest dry bulkers on the road. They are equipped with Gardner Denver blowers, Kunkle pressure relief valves, Polar filters, Knappco dome lids, and Sure Seal butterfly valves. Carlson Inc prefers semitrailers over the doubles units that are popular in the west, because doubles must be separated and unloaded individually.
Fleet equipment is a major part of the Carlsons' dedication to running an efficient operation of high-quality service in a specialized market that requires superior cleanliness and on-time performance. The Carlsons are predicting a leveling off of the milk market, but are anticipating growth in their other foodgrade services, where they will be watching for further diversification opportunities.
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