Company Report: Jacobson Companies Inc.
“Can Do” 3rd Party Logistics Headquartered in Des, Moines, Iowa, Jacobson Companies has grown from a small Midwestern firm to a national power player

Jacobson Companies Inc.

Jacobson Companies Inc.

With 190 sites across the US – including more than 32 million square feet within 35 major markets – Jacobson Companies is the third largest warehouse services provider in the US by square feet and well equipped to meet the needs of every customer.

Founded as a warehouse operation in 1968, Jacobson has since expanded its offerings into five lines of business — warehousing, transportation, logistics, packaging and contract manufacturing, and temporary staffing — and now employs more than 6,700. The company has recently organized its offerings into three segments. Contract Logistics Services (“CLS”) encompasses domestic warehousing, staffing, packaging and contract manufacturing. Transportation Logistics Services (“TLS”) is comprised of Jacobson’s domestic asset-based and dedicated trucking operations, freight management, and brokerage and logistics offerings. International Logistics Services (“ILS”), launching in 2010, will offer its customers international freight forwarding and other 3PL services abroad.  

Despite its already impressive range, the company continues to grow both organically and through acquisitions. In fact, it was this factor that brought VP of Operations John Stewart to the company two and a half years ago after spending most of his career with Schneider National.

“Over the past ten years Jacobson has seen amazing growth from a smaller Midwestern player to a national company,” Stewart explains. “It was this growth potential that brought me to the company. We are opening an international division in 2010, and we are excited about that.”

STABILITY THROUGH DIVERSITY
While Stewart acknowledges the recession “certainly has been a big factor”, he says diversification and a balanced portfolio helped the company to weather the downturn and pick up new clients along the way.

One of the few 3PLs to offer such a wide range of services, Stewart says it is the combination of warehousing, transportation and logistics that sets Jacobson apart. Add in Jacobson’s packing, manufacturing and staffing services, and the soon to be added international freight forwarding and related services, and Stewart says you have the “total solution.”

“Customers looking to cut costs are turning to 3PL businesses so that we can cut costs for them while they focus on their core businesses,” says Stewart. “We often get a foot in the door with one service and then end up handling all of their services.”

This has been especially important as shipping has been down due to the economy. “There is downward pressure on rates and volume,” states Stewart. “We are seeing capacity exit the marketplace, a tightening of capacity with LTLs, and carriers going under.” However, the company has seen significant growth in warehousing because as Stewart aptly points out “If things aren’t moving, they’re sitting.”

VALUED EMPLOYEES
In addition to diversified services, Jacobson also offers its customers the expertise of its employees. “Being a 3PL service, really all we sell is our people and our systems,” explains Stewart. “Our people are our competitive differentiator.

“Jacobson has always been a family oriented company,” he continues. “We have very strong values and a Midwest culture, so we work hard to attract, retain, and further develop our employees.”

The company offers a competitive compensation package and boasts very low turnover rates. Many employees have been with the company for over 20 years.  “I think our people see working here as more of a career than a job,” says Stewart.

Jacobson invests significantly in employee training and regular safety meetings. “We will take the extra expense for safety,” says Stewart. “Our trucks have a ‘Safety starts here’ motto and that goes all the way up the line. Drivers are responsible for telling us when they don’t think something is safe, and we work with the drivers. For example, we will get another driver if someone is fatigued.”

TECHNOLOGY AND GOING GREEN
Jacobson has also invested in the latest technologies and green innovations. Their in-house developed technology allows the company to “track and trace assets through satellites and know up to the minute locations,” says Stewart.

A Smart Way Certified Carrier, Jacobson’s systems also recommend the lowest cost fuel solutions and the best routes for drivers to take. Out of Route allows fleet managers to determine if a driver is out of route and redirect them, saving fuel consumption and emissions, while Auxiliary Power Units in trucks generate heat and air in the cabin without running the engine. “This keep costs down and good for the environment,” states Stewart.  

The company also works to manage waste and reduce energy usage while educating employees on environmental responsibility. They use automated lights and conduct annual audits at their facilities, working to monitor energy consumption strategies and recognize areas that can be upgraded or repaired to save energy.

Additionally, Jacobson has instituted a number of other recycling initiatives. “We burn waste oil to heat the shops,” says Stewart. “This means we don’t have to dispose of the oil, and we get heat out of it. It’s a two fold good for the environment.”

LOOKING FORWARD
Jacobson is always looking toward the future, as exemplified by their emphasis on technology and the environment. While the current economic climate is not ideal for growth, Jacobson Companies Inc is primed for a strong 2010 and explosive growth in the future.

The company has a number of deals in the pipeline and is predicting better than average growth based on first quarter deals. “We plan to grow both organically and through acquisitions,” Stewart explains, adding that the company is planning on both types of growth through the first half of the year and is investing in the sales force to prepare.
“We are always on the lookout for acquisitions, but it has to be the right deal,” he says. “We don’t want to acquire just for the sake of acquisition.”

Meanwhile, organic growth is expected as the economy begins to improve. Jacobson was able to secure new business during the downturn when their existing customers were suffering. As the economic situation improves, both existing customers and new ones will need more services which will lead to massive growth.

“It’s been challenging but we are now in a good position,” concludes Stewart. “The worst of it is over and we expect steady progress each month as we go on.”

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