High quality provides lower operating costs
Oct 1, 2002 12:00 PM, By Gary Macklin
Phoenix Wholesale Food Service keeps its business plate full by making sure that its 500 customers never come close to serving an empty plate.
Phoenix Wholesale is a produce foodservice distributor operating from 90,000 sq ft of space at the Atlanta State Farmers Market in Forest Park, Georgia. Although some of its broadline foodservice competitors are larger, David Collins, president, says that Phoenix Wholesale is the largest produce distributor in the Atlanta area.
The Collins family has deep roots in the Atlanta produce business with some members selling fruit and vegetables in the area in the 19th Century. In fact, the company name comes out of that history, referring to Atlanta rising like a phoenix out of its own ashes after General Sherman's unpleasant visit to the city in September 1864. The present business started in June 1970 and recently celebrated its 32nd anniversary. The company has 200 employees. This total includes seven of the eight living members of the Collins family.
Collins says that Phoenix Wholesale will make any delivery to any customer at any time. “We base our service on morning runs six days a week,” he says. “However, we always send out 10 to 12 trucks on second runs every day. Usually those second runs result from some sort of pop-up situation at a customer — a forgotten order or a regular order placed by someone other than the primary buyer. Very seldom does a customer intentionally plan on two deliveries for the same day. It doesn't matter what the afternoon order is for — 10 cartons of tomatoes or four ounces of exotic mushrooms — we fill the customer's need and usually fill it within two hours. We sell produce; we sell service; and we sell freshness. We refuse to let our customers deal with empty plates, because that gives them an opportunity to look for another produce supplier.”
Rapid inventory turns
Maintaining fresh product is easy for Phoenix Wholesale. Collins says that the inventory turns over every 40 hours and includes just about every conceivable produce item. Products that once were thought to be only for special-order are now commonplace, he says. On any given day, the company receives 10 to 12 full trailer loads from suppliers across the country.
The company serves all of Georgia except for the extremely rural areas in the southern part of the state as well as parts of Alabama, South Carolina, and Tennessee. However, metropolitan Atlanta contains the bulk of the sales from Phoenix Wholesale. The area within a 20-mile radius from the Interstate highway loop around Atlanta probably accounts for 70% of the business, Collins says.
Customers range from small, independent restaurants to major corporate hotel chains along with country clubs and other private dining establishments. “We do very little in sales to retail accounts,” Collins says. “To handle that part of the business, we have a separate division.”
Phoenix Wholesale operates six days a week and provides delivery based on customer volume and storage capability. Many large customers get a delivery every day, while some rural accounts can get by on two deliveries a week. Orders in by 9 pm are included in routes that leave the distribution center by 6 am the next morning. If a customer needs an afternoon delivery, the order should be in the house by 11 am for delivery the same day.
A typical delivery day puts 45 routes on the street in the morning. Most of those carry 10 to 12 stops. Route duration varies widely. In downtown Atlanta, stops are probably no more than 10 minutes apart, Collins says. In outlying areas, trucks may spend 30 minutes or more on the road between stops. All the routes are organized by geographic area such as downtown or the Buckhead area in the Northeastern quadrant of the city.
Phoenix Wholesale runs a fleet of 58 straight trucks and four tractors and trailers. The fleet includes 14-, 18-, and 26-ft straight trucks, all on single drive chassis. The 14-ft bodies are on Isuzu chassis for use in congested downtown Atlanta. The remainder of the fleet uses International medium trucks. The newest are International's 4300 series first introduced in March 2001. The new design replaces a line of trucks that International sold for more than 20 years. The first of the S-class medium trucks were introduced in 1977.
Like the looks
“We've been buying from International for 10 years or more,” Collins says. “We switched from Chevrolet. These new trucks are noticeably different from our previous International chassis. They have a shorter turning radius, and the driver can see other traffic better. That is particularly true with the sharply sloped hood. We also like the redesigned front end with all the chrome trim. The new design looks better than the previous International design, and the front end chrome matches nicely with our stainless steel truck bodies.”
The new International chassis are powered by International DT466 engines rated at 215 horsepower at 2,300 rpm. The engines produce 540 lb-ft torque, which gives good performance in the hills of North Georgia. Engines are mated to Allison Automatic transmissions. The heavier trucks, rated at 33,000 lb, are equipped with the 3060P transmission, while the 26,000-lb chassis use the Allison 2400 automatic transmission.
Collins says that Phoenix Wholesale has been using automatic transmissions for the past six years. Automatics eliminate clutch repair, which is a constant factor in a local delivery operation using manual transmissions. Additional benefits include lower requirements for driver training and lower maintenance costs, Collins says. “An automatic won't suffer a clutch failure and leave an expensive load sitting beside the road,” he says.
Phoenix wholesale buys its trucks with five-year extended maintenance warranties. Trucks are rotated out of the fleet sometime between their fourth and fifth year. In some instances that vehicle trade includes the truck body, but at other times, the body is remounted on a new chassis.
“We have a habit of over-specifying our equipment around here,” Collins says. “Our truck bodies are a good example of that. We buy bodies with stainless steel exteriors instead of aluminum. We specify nonskid aluminum floors and Kemlite fiberglass liner panels that are easy to keep clean. I've always found that one of the best ways to control overall cost is to maintain a high quality fleet.”
Collins puts that principle into practice with the refrigeration units at Phoenix Wholesale. Thirty-nine of the refrigeration units in service or on order are Thermo King's new TS-200s with scroll compressors. They are replacing older MD-II or KD-II units. He says that moving parts produce friction and that friction equals wear and tear on mechanical equipment. The compressors in the TS-200 units have fewer moving parts than conventional compressors in the MD and KD units, so they require less maintenance, he says.
Collins has another reason for selecting new compressor technology as well. Phoenix Wholesale was so intent on using scroll compressors that its units were delivered in early 2000, before some Thermo King dealers received their first units for stock. “We want to make sure we are not left behind,” he says, “because once we get behind, it will cost more than we ever intended just to catch up.”
The scroll compressors are not the only premium item about refrigeration at Phoenix wholesale. Collins also purchases in-cab remote controls for refrigeration units and equips them with electric standby for quiet operation overnight while the bodies are loaded.
Trucks run with the thermostat set between 36° and 38° F. Many of the bodies are equipped with plastic strip curtains at the rear to help maintain temperature during delivery stops. That's all part of Collins thinking about performance. “We could have bought smaller refrigeration units and less expensive bodies and still have done a good job,” he says, “but our goal is excellent performance, not just fair. We are looking for the best possible value for our money. That is not accomplished by buying cheap equipment; it's accomplished by spending money on good quality.”
Refrigeration maintenance is left to the experts. Two years ago, Phoenix Wholesale entered a maintenance contract with Thermo King Atlanta. Technicians from the dealership visit the warehouse at least twice a week to perform general unit inspections and to service units as required. Collins says that the maintenance contract has helped support the resale value of used units as well as catching potential unit problems before they happen. “The only way to avoid a huge hit in repair costs is to follow a comprehensive maintenance program,” he says.
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