Past Winner Stories
Freight Masters Systems
www.fmstrucking.com
When Gene McFadden started Freight Masters in 1978, he focused on three fundamentals: discovering synergies, solving problems and delivering excellent customer service. After 20 years in the fiercely competitive trucking business, those ideals were still guiding the company. And getting results.
Supplier excellence awards from DaimlerChrysler in 1987, 1996 and 2000 provided good indicators, McFadden noted, that the company was doing some things exceptionally well.
However, he also pointed out that by 1999 Freight Masters was being operationally paralyzed by a lack of cash flow and the capital equipment required fur expanding new business.
"We had won too many bidding battles that shrunk profit margins to painfully slim proportions; he said. "Leading us firmly by the hand to bankruptcy's door were the new projects beginning simultaneously, all requiring cash flow and capital equipment purchases to successfully start and maintain."
Challenges included a sluggish U.S. economy that had shut down many surface transportation companies in the past two decades. But in that same 20 years, the world had seen a shift to a global economy. The period saw unprecedented growth in international trade, especially between the United States, Canada and Mexico. Information systems and technological innovations were reshaping the needs of major United States corporations - three of which were among Freight Masters customers: General Motors, Ford and DaimlerChrysler.
Clearly, Freight Masters had to figure out how to do more fur automobile makers than simply lower the cost of each mile. Management teams dug deep into every aspect of how the company did business to identify cash flow and investment solutions.
"But after countless hours of running numbers, metrics, data and projection forecasts, our quite competent CFO at the time convinced most of us that Freight Masters Systems and Freight Masters Systems, International, would not exist in six months," noted McFadden.
McFadden disagreed with that assessment, and in late 1999 and early 2000, the company rolled up its collective sleeves and examined critical criteria: its service capabilities and the precise transportation needs of automotive manufacturers. The company developed a transportation plan that would construct expert logistics management teams and global alliances to transport finished vehicles seamlessly from plant release to delivery for U.S. and international sale. Freight Masters would manage the whole process, from plant to dealer.
"We presented our bold, new concept to Ford Motor Company in early 2000," said McFadden. "Ford declined our bold, new program.”
Undaunted, Freight Masters pitched its plan to DaimlerChrysler, which accepted the offer. For the first time in the history of DaimlerChrysler, a single transportation company would logistically manage the entire movement of each vehicle, from plant to dealer.
As a result, the auto manufacturer reported substantial savings, and by 2002 Freight Masters' non-asset-based revenues from DaimlerChrysler nearly doubled asset-based revenues.
The success of the program prompted the formation of two independent companies in Mexico and Indianapolis, and in 2001 Freight Masters began a single source, "Door to Door" intermodal transportation program with GM.
From plant to dealer, Freight Masters manages transit tracking, customs processing, damage prevention and quality control programs, as well as communications systems in the United States and Mexico. It also deals with Mexico trucking companies and primary railroads, global shipping lines and major United States haul-away carriers, all of which results in safe, cost-effective and timely transport projects.
McFadden loves the complexities inherent in his business. "I truly enjoy the challenge of problem resolution;" he said, "There is no greater joy than to develop answers that bring resolution to problems –old or new."
Supplier excellence awards from DaimlerChrysler in 1987, 1996 and 2000 provided good indicators, McFadden noted, that the company was doing some things exceptionally well.
However, he also pointed out that by 1999 Freight Masters was being operationally paralyzed by a lack of cash flow and the capital equipment required fur expanding new business.
"We had won too many bidding battles that shrunk profit margins to painfully slim proportions; he said. "Leading us firmly by the hand to bankruptcy's door were the new projects beginning simultaneously, all requiring cash flow and capital equipment purchases to successfully start and maintain."
Challenges included a sluggish U.S. economy that had shut down many surface transportation companies in the past two decades. But in that same 20 years, the world had seen a shift to a global economy. The period saw unprecedented growth in international trade, especially between the United States, Canada and Mexico. Information systems and technological innovations were reshaping the needs of major United States corporations - three of which were among Freight Masters customers: General Motors, Ford and DaimlerChrysler.
Clearly, Freight Masters had to figure out how to do more fur automobile makers than simply lower the cost of each mile. Management teams dug deep into every aspect of how the company did business to identify cash flow and investment solutions.
"But after countless hours of running numbers, metrics, data and projection forecasts, our quite competent CFO at the time convinced most of us that Freight Masters Systems and Freight Masters Systems, International, would not exist in six months," noted McFadden.
McFadden disagreed with that assessment, and in late 1999 and early 2000, the company rolled up its collective sleeves and examined critical criteria: its service capabilities and the precise transportation needs of automotive manufacturers. The company developed a transportation plan that would construct expert logistics management teams and global alliances to transport finished vehicles seamlessly from plant release to delivery for U.S. and international sale. Freight Masters would manage the whole process, from plant to dealer.
"We presented our bold, new concept to Ford Motor Company in early 2000," said McFadden. "Ford declined our bold, new program.”
Undaunted, Freight Masters pitched its plan to DaimlerChrysler, which accepted the offer. For the first time in the history of DaimlerChrysler, a single transportation company would logistically manage the entire movement of each vehicle, from plant to dealer.
As a result, the auto manufacturer reported substantial savings, and by 2002 Freight Masters' non-asset-based revenues from DaimlerChrysler nearly doubled asset-based revenues.
The success of the program prompted the formation of two independent companies in Mexico and Indianapolis, and in 2001 Freight Masters began a single source, "Door to Door" intermodal transportation program with GM.
From plant to dealer, Freight Masters manages transit tracking, customs processing, damage prevention and quality control programs, as well as communications systems in the United States and Mexico. It also deals with Mexico trucking companies and primary railroads, global shipping lines and major United States haul-away carriers, all of which results in safe, cost-effective and timely transport projects.
McFadden loves the complexities inherent in his business. "I truly enjoy the challenge of problem resolution;" he said, "There is no greater joy than to develop answers that bring resolution to problems –old or new."