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Company Reports - Kool Pak LLC: A mighty cold road  


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Kool Pak LLC: A mighty cold road

Kool Pak LLC: A mighty cold road

Written by Anne-Frances Hutchinson | Produced by Lorraine Heist

There's a reason that many of the industry giants come to Kool Pak LLC for their refrigerated warehousing, transportation and logistics needs: balance. In addition to full truckload and LTL transportation services, Kool Pak specializes in warehousing and distribution - the refrigerated-services industry equivalent of a high wire act.
Kool Pak LLC: A mighty cold road
There's a reason that many of the industry giants come to Kool Pak LLC for their refrigerated warehousing, transportation and logistics needs: balance. In addition to full truckload and LTL transportation services, Kool Pak specializes in warehousing and distribution - the refrigerated-services industry equivalent of a high wire act.

Company CEO Steve Ness purchased Kool Pak in 1986, and over the years structured the business to become a segment leader in regional refrigerated services. In 2005 Kool Pak expanded services to 48 states and Canada. Today the company serves Oregon and Washington with refrigerated redistribution services, and refrigerated full and less-than-truckload services throughout the U.S. and Canada. In addition to transportation, Kool Pak offers warehousing and logistics services to the perishable food industry.

The decision to specialize in the perishable foods segment and focus on LTL came from recognizing this niche market was underserved and few providers met the needs of the industry. Kool Pak identified the need to offer national and local services that met shippers' on-time delivery requirements as well as addressing concerns about product protection throughout the distribution cycle. The marketplace was looking for new and innovative solutions, Ness says.

"There is a barrier to entry in this segment of the industry due to complexity and cost," he admits. "Successfully serving an LTL customer is much more difficult than other segments of the broadline transportation industry."

At any given time, a Kool Pak truck will carry frozen, chilled and dry goods in the same trailer. Ness points out that in order to successfully manage mixed temperature freight a carrier must have specialized equipment, strategically located refrigerated facilities, well trained personnel in all levels of the company and the technology to track the freight. The success of this program is demonstrated in the industry leading claims to revenue ratio of only .001 percent.

"It takes good people, training and consistency to continually meet our customers' expectations. It takes specialized equipment, technology and strict adherence to company procedures," Ness notes. "Shippers have come to realize that they need to carefully select their carrier partner. It doesn't make sense to make the investment into manufacturing and quality production standards to deliver great products, then select a carrier that cannot match the same standards of care through the distribution cycle. In today's environment, manufacturers are well aware of the risk and downside of a product recall. Shippers and manufacturers have begun taking the necessary steps to improve the carrier selection process, looking for seamless service that enhances their own customer satisfaction ratings."

"Maintaining temperature and product quality, delivering on schedule, and providing vital information using advanced tracking are all part of the quality expected by leading producers. There are a limited number of transportation service providers that can deliver on these promises," he continues.

"Think of it from the customers or shippers' point of view. A company that ships a few pallets across the country expects that product to arrive at their customers' location within the appointed delivery time and at the correct temperature. The service requirement on those few pallets will be as critical to this shipper as a full truckload is for a large shipper. The expectation is the same."

Nothing but the coolest technology
"The technology requirement is enormous, but without it you cannot perform. It is vital to providing the highest level of service. Technology provides a strategic advantage in keeping us ahead of the competition and meeting our customers' needs," according to Ness.

Kool Pak uses TruckMate√ô enterprise transportation software to transmit and receive orders, track shipments, confirm pickup and delivery appointments, provide customer reports, and communicate with drivers. Early on, Kool Pak partnered with TruckMate's developers to create a customized operating system.

Company CFO and partner Wade Palmer explains: "We were able to work with the ownership of TruckMate√ô to develop solutions that were specific to our needs within the specific LTL marketplace. We helped develop an application for LTL companies that they rolled out to other customers. "That provided us the background to grow. We've averaged 28 percent growth since 2003, and we have been able to trim some of our admin burden out of our overhead because of efficiencies we've gained."

Additionally, sophisticated GPS, mobile communications and onboard computing systems link the tractors to the operating system. "We also added e-to-e technologies, OCR scanning and a paperless automated billing system," Palmer notes. These tools enable management to get a better overall view of the business, comply with complex, multi-agency regulations, measure driver and equipment performance, and lower costs.

A long-term partnership with Penske lets Kool Pak management focus on customer service while Penske manages the fleet. Says Ness, "Unlike a lot of other carriers that spend time focusing on selling used equipment, maintaining their fleets, managing maintenance facilities and dealing with the responsibilities for the environmental impact of those maintenance yards, we have none of that. We have one manager that interfaces with Penske and that's it. Penske manages all of the maintenance, acquisition and disposition of equipment, road hazard and breakdown issues and at a cost that is competitive with doing it yourself. We consider this relationship as a cornerstone to our overall market strategy."

By utilizing the latest in motor management technology and backed by Penske's on road service, Kool Pak has an extremely low amount of equipment breakdowns. By embracing the strategy to continuously purchase the best possible equipment, supported by advancing technology, the company is able to spend time working with customers to find better cold chain solutions. "We are delivering on customer expectations," Ness says.

Customer loyalty
"Providing superior customer service and building customer loyalty is our most important objective." The company measures loyalty through an electronic survey tool to make sure they are meeting expectations at all points of contact. The firm is currently launching a new seven-point customer loyalty initiative, designed to keep customers closer. Ness describes the outreach as "a much broader relationship with the customer, taking the partnership to the next level. We are studying our relationship at every point of contact to insure we are exceeding expectations with every department.

Thinking green
The company's concern for its customer base is matched only by their commitment to environmental stewardship. A member of the EPA's SmartWay Transport program, which aims to reduce the impact of transportation on the environment, Kool Pak is actively involved with a number of green initiatives. An aggressive MPG incentive plan, the use of auxiliary power units to reduce idling, and testing new trailer designs are among the ambitious slate of improvements designed to better the company's performance, cut costs, and reduce its environmental footprint. It's a lot to balance, but it's just another aspect of accountability that keeps Kool Pak aiming toward success.

A word from CEO Steve Ness
"Shippers, driven by the public, are much more concerned today about the care and safety of their product while in the custody of a carrier. Food safety is the most important issue in the distribution cycle. Many carriers do not have the capability to provide the level of care necessary. We have invested heavily in our business in order to insure product safety to the highest possible standards."
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