Sep 1, 2002 12:00 PM, By Mary Davis
WHEN Johnny Leibham started Leibham Milk Transport Inc in Houston, Texas, in the 1950s, he spent a good deal of time underneath a shade tree near his home in the Houston suburb. However, he wasn't resting in a hammock. The shade tree served Leibham as an open-air shop for keeping his 1957 Chevrolet and 2,800-gallon Certified tank trailer on the road.
The open air didn't always serve him well, especially when Leibham had to work on a truck in 1961 when Hurricane Carla slammed into the Texas coast, bringing with it 145-mile-per-hour gales. Although it was one of the most powerful storms in US history, it failed to stop Leibham at his labors. He knew that cows have to be milked no matter the weather, and someone has to see that their product makes its way to the processor. With the encouragement of his wife, Mary, Johnny completed the truck repairs and delivered the milk.
Now based in Navasota, Texas, Leibham and his son, Danny, continue to repair fleet vehicles in-house, but a three-bay maintenance shop has replaced the tree, although the covered bays remain open to the air. Leibham Transport, a contract hauler for Dairy Farmers of America, serves 39 dairy farms in a 100-mile radius of Houston and has one long-distance run for Milk Transport Service.
Having a hands-on policy is a major contributor to the small company's success. Father and son not only handle almost all of the maintenance, they climb into the cab when an extra driver is needed. Their abilities, combined with the administrative capabilities of Mary and Danny's wife, Debbie, have seen the company through industry downturns. An added bonus is the Leibham's daughter, Cindy, who is a certified public accountant.
In the 1980s, a government program to reduce milk production led to the shut-down of one-third of the dairies in the market that the company served. When he began hauling milk in the Houston area, there were 300 dairies — today, only four remain.
More recently, the dairy industry, like others, has been affected by consolidations and mergers. Although many milk haulers were unable to function in the soured market, the Leibhams stayed in business, continuing to do as much of the work themselves as was possible. Fortunately, the family thrives in the hands-on environment.
“It's been our life,” says Johnny. “And, Danny and I are mechanically inclined.”
Just as they know the importance of their sweat-of-the-brow work, the Leibhams also understand other management practices are required to insure a successful operation. In the beginning Johnny kept a sharp eye out for opportunities that fit his niche of farm pick-up joined with long-distance transport. Through the years, Johnny acquired a few companies whose owners could not withstand the market downturn. Meanwhile, Danny honed his business acumen by obtaining an agriculture system management degree from Texas A&M University. Debbie, also a Texas A&M graduate with a biochemistry degree, adds her knowledge to the company in tandem with Mary's long-time experience with the recordkeeping.
Most recently, the Leibhams received the contract from Milk Transport Service for a route that originates in Dublin, Texas, and ends at a processing plant in Houston.
“This is a perfect run,” says Danny. “It fits within the hours-of-service regulations and gives a full day's work to the driver. The Dublin business is an excellent way to supplement our local hauling.”
To handle the transportation, the company has seven 6,500-gallon tank trailers and six Peterbilt tractors. The age of the Citation tank trailers in the fleet, the youngest produced in 1982, are testimony to the Leibhams' maintenance ability. Father and son also repair the various valves and ITT Jabsco pumps that are contained in the trailer cabinet. The men have replaced the trailers' running gear and completed other repairs as necessary. For the work they deem out of their expertise, including the federally-required inspections, the Leibhams rely on Brenner Tank LLC in Houston.
After a recent accident in which a tractor was beyond repair, and wanting to avoid the cost of a new tractor, the Leibhams purchased a Peterbilt glider kit. The men then set to work salvaging the engine, transmission, rear suspension, and other usable parts from the damaged tractor, and added them to the Peterbilt kit. The result was a like-showroom-new vehicle.
Although the Leibhams can handle most tractor maintenance, they send tractors to the dealer for internal engine work. The Peterbilt tractors are purchased from Rush Truck Center in Houston. They have Caterpillar 410-horsepower engines and Eaton Fuller nine-speed transmissions. Running gear includes Peterbilt air suspension, MeritorWABCO antilock braking, and ArvinMeritor axles. The tractors and trailers have Alcoa aluminum wheels. “We think we get better tire wear, and we like them for lightweight and appearance,” says Johnny.
Despite the majority of the routes being local, the Leibhams specify tractors with sleepers. They want drivers to be comfortable while waiting to load or unload.
In another effort for cost control, the Leibhams have two, 10,000-gallon underground diesel tanks used for truck refueling. “I can buy a tank trailer load at a time,” Johnny points out. They also purchase lubricants in 55-gallon drums.
The senior Leibham grew up on a dairy farm, and in 1955 began hauling milk cans for his father and a neighbor, who also was a dairy farmer. When hauling milk cans gave way to bulk transportation, Leibham and a friend boarded a train and traveled to St Paul, Minnesota, to buy the 2,800-gallon tank trailer.
“I had never driven a tractor and trailer rig at that point,” he recalls. Nevertheless, the pair made the trip home without incident, and Leibham began calling on farmers in the area in order to solicit additional business.
“I got three customers, but I was milking cows at the same time to pay for my equipment,” he recalls. “I was running the truck every other day. Finally, I got enough customers so that I could quit milking.”
In 1959, he and Mary were married. One of Johnny's sisters worked at Carnation Company, and one of Mary's cousins also worked there. They introduced Mary and Johnny. As they say the rest is history.
In the late 1960s, business was tough, so the couple decided to sell it. While negotiating a price with another hauler, the hauler offered to sell his business, and Leibham bought it.
After making the decision to stay in business, he hired his first driver and bought a 5,600-gallon trailer. By 1975 he was collecting milk from 125 dairy farms. “I was still working on the equipment under the tree,” he adds.
Danny followed in his father's footsteps. He slipped behind the wheel while he was still in high school — driving on weekends — and continued as a part-time driver through college. After graduating from Texas A&M in 1988, he joined his parents in the business.
Many changes have occurred throughout the years that Leibham Transport has been in operation. Sanitary requirements grew more demanding for foodgrade haulers. And the September 2001 terrorist attacks on the United States added to the burden. Today, there is concern that product in foodgrade tanks could be sabotaged. In an effort to offset tampering, greater emphasis has been placed on the use of cargo seals. After a tank trailer is cleaned at the processing plant, two seals are attached at the manhole and one at the rear cabinet. Hoses are stored inside the cabinet, along with a cooler used for milk samples. When the seals are broken to load the tank, they are replaced with others as soon as the tank is full. DFA provides the seals for their carriers.
In addition to security concerns, the company contends with the industry's escalating insurance rates and vacillating diesel costs. Renewing casualty insurance this year resulted in a 60% increase from the year before. Health insurance costs for drivers rose 50%. Although the price of diesel is currently down from last year, the company covers the eventuality of an increase by contract surcharges.
As far as drivers are concerned, the company is more fortunate in its retention than much of the industry. Two of the six full-time drivers have been with the company for 15 years. If a new hire is needed, Danny conducts driver training, including defensive driving. Emphasis is placed on sanitary requirements. Although processors handle tank cleaning, drivers are required to clean the cabinet and its equipment. Two drivers are assigned to the Dublin route. Others are assigned specific farm routes that they serve daily. They work a six-day-on, two-day-off schedule and park the vehicles at home.
Despite the hours the Leibhams devote to their operation, they find time to participate in the International Milk Haulers Association. Johnny serves on the association's board of directors and the two families coordinated one of the national meetings in Galveston in 2000. But they say those efforts are a small part of their lives. Keeping their business operating smoothly and economically requires full-time attention. Even though they don't have to work under the tree anymore, the Leibhams typically can be found in the shop or driving a truck, continuing their philosophy of hands-on management.
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