RLS Logistics integrates distribution, transportation, and warehousing
Mar 1, 2003 12:00 PM, By Gary Macklin
Mushrooms spring up overnight. RLS Logistics has taken somewhat longer, but still has mushroomed from a small family business in rural New Jersey southeast of Philadelphia into a true logistics services company with four operating divisions.
In fact, the company was founded in 1968 as R Leo & Son to grow mushrooms. At the height of that part of its history, it had four buildings for indoor cultivation of mushrooms. Indoor farming remained the backbone of the company until 1988, when the Leos, a family of Italian immigrants branched out into public cold storage with 10,000 sq ft of temperature-controlled space as R Leo & Son Freezer Storage. Today, warehousing has grown to 150,000 sq ft of frozen, chilled, and dry space on the original property in Malaga, New Jersey. Including short-term storage on the LTL dock, the property has space for 12,000 pallet positions. The four mushroom buildings still are used as additional dry storage space. In addition to the headquarters facilities, RLS leases 50,000 sq ft of frozen space in nearby Vineland, New Jersey.
The third generation of the Leo family now handles day-to-day operations with the second generation intimately involved. Anthony Leo, son of the founder as noted in the original company name, is president. Russell Leo, named for his grandfather, is vice-president — transportation and distribution; and Anthony M Leo, named for his father, is vice-president — warehousing.
Asset-based logistics provider
RLS is a true logistics company with no concentration on either warehousing or transportation, the Leo brothers say. However, unlike some third party logistics providers, RLS has assets in the form of real estate, buildings, and a fleet. In practice, transportation generates about half the company's $12- million annual revenue with the remainder provided by warehousing and distribution. Until recently, the company operated with three branches — RLS Cold Storage handling warehousing; RLS Transport running a company-owned LTL motor carrier within a 300-mile radius of Malaga; and RLS Distribution to procure third party motor carriers for nationwide LTL and truckload service.
Starting in December 2002, the company added another division — RLS Packaging for home delivery of small shipments sold by vendors such as the QVC cable television network. In its primary role as an order fulfillment service, RLS Packaging selects individual orders from warehouse inventory, packages them in insulated containers for shipment with dry ice or refrigerated gel packs, and arranges for shipment by carriers such as UPS or FedEx. A five-pound block of dry ice is sufficient to hold product in an insulated foam container at 0° F for up to 48 hours. The new business has proved successful, because RLS doesn't have a lot of competition in the field, Anthony M Leo says.
Until recently, the Leo family companies operated under two names: the original R Leo & Son Freezer Storage name and Quick Frozen Transport, the freight brokerage purchased in 1993, when the company entered the distribution arena. In 1995, a company-owned fleet was added to Quick Frozen, because the family wanted access to a constant, reliable source of transportation instead of having to rely always on third party carriers. In January 2002, the names of all the operating divisions were changed to carry the RLS label. “We just got tired of explaining to potential customers that the names were different, but that we really were a single company with a wide range of services,” says Anthony M Leo. “With our new, single identity, we can promote the company as a whole and offer customers a wide choice of services from an extensive menu.”
Customers order combinations
Choosing from that menu, some customers use only trucking while other ask only for warehousing. Others want only warehousing with inbound transportation provided by their private fleet or a third party carrier and outbound delivery on a for-hire carrier. However, most want a combination of services. Many, in fact most, Russell Leo says, want a turnkey logistics solution that includes trucking, warehousing, freight consolidation, and distribution. “We handle about 150 loads a week in total with our internal fleet handling an average of two loads per week per trailer,” he says. “Our company fleet consists of 12 tractors and 26 refrigerated trailers.”
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