Monson Makes Fast Start in NAFTA and Intermodal Market Britt, Iowa, is hardly the center of the universe, but a refrigerated motor carrier headquartered in the town of 2,200 is putting it on the map of international commerce.
R E Monson Inc with some 90 tractors and 160 refrigerated trailers is participating in international trade as both a NAFTA carrier in North America and an intermodal carrier for refrigerated containers to East Coast and West Coast ports.
The company delivers about 50 loads a week to Laredo, Texas, for transshipment into the interior of Mexico. It delivers about two dozen marine containers of meat to the West Coast every week for ocean shipping to Asian markets. About six to eight containers of pork are hauled to Newark, New Jersey, each week for shipment to Europe. Yet, the international aspect is only a small part of the Monson operation. The great majority of Monson's business is within the United States, serving many meat packers in the Midwest.
While the company has authority to serve 48 states, most of the business is concentrated along the East-West lanes of its intermodal shipments and the North-South lanes from Mexico to Canada. In fact, Monson is expanding its coverage in Canada to serve its Mexican shippers better.
One of the distinctive features of the Monson operation is the willingness to invest in expensive facilities in order to develop new markets. Ron Monson, president, says that his attempt to enter the Mexican market a few years ago faced so many problems that it was hardly worth the effort. The main port of entry at Laredo was overburdened with truck traffic. Parking a truck was one of the biggest problems. Waiting to cross the bridge, waiting for customs inspection, lack of overnight facilities, thefts - all of these problems added up to a questionable outlook for any profit from the new venture.
Monson solved 90% of these problems by buying five acres in the Milo Distribution center and building a 15,000-sq-ft refrigerated terminal. Half the new terminal storage is a freezer for frozen foods, and the other half is a cooler. It has fully enclosed loading docks for both trucks and rail cars. The 60- by 260-ft building also has a 450-sq-ft driver lounge, USDA inspector and laboratory on site, and facilities to handle all export documents. In addition, Monson is adding in-house forwarding and an on-site cigar inspection service to the terminal. Operating as Border Drayage, this new terminal is located off Interstate 35 at Exit 8 and is in line with the new World Trade Bridge that opened recently.
A meat shipment from Omaha to Laredo, for example, might be unloaded and stored in the cooler. Every package could be relabeled with the required Spanish language labels, repalletized, USDA inspected, and then reloaded onto the same trailer for a direct shipment or reloaded onto a trailer belonging to a Mexican carrier, depending on destination.
In order to serve all areas of the Republic of Mexico, Monson works with five Mexican carriers that were selected after careful investigation. This has paid off, he says, because the company has lost only one trailer in three years of operation into Mexico. That trailer, incidentally, was stolen on the US side of the border. Monson says that he is one of the few US refrigerated truck lines to carry Mexican cargo insurance, including coverage for damage caused by refrigeration unit breakdown. He also says that he has very good relationships with his Mexican carriers because he pays them in seven days or less, versus the more common payment period of 30 days or more. "When trucks are tight in Mexico, we get the trucks we need," he says.
Backhauls from the interior of Mexico include fresh produce, glass articles, furniture, candies, and fish. Some of these shipments have destinations in Canada, making R E Monson a true NAFTA carrier serving all three North American treaty partners.
Monson's intermodal container business is smaller than its NAFTA business. The company has carved its niche by investing in container chassis and the required gensets to power refrigeration units. One of the Monson chassis was exhibited at the International Expo in Atlanta in April 2000.
Among the advantages of the Monson chassis, as built by Reinke Manufacturing Co of Deshler, Nebraska, is its 43 11/42-ft length. With a 40-ft marine container positioned at the rear of the chassis, the extra 3 11/42 ft over the kingpin improves weight balance. The kingpin is set back only 18 inches from the nose, and the air suspension Intraax axles are spread 121 inches. The wheelbase from the kingpin to the center of the rearmost axle is 39'11".
"We can haul 3,500 lb more in 40-ft containers because of our lightweight chassis and longer gooseneck," says Monson. "The longer wheelbase lets us scale 80,000 lb, and spread axles allow a 20,000-lb legal load on each trailer axle for greater flexibility in loading."
The Reinke chassis weighs 6,300 lb and includes lightweight options such as aluminum hubs and wheels and Centrifuse brake drums. The space over the extended gooseneck is used for a spare tire carrier, which is necessary because the chassis mounts an unusual size tire - 255/70R22.5. A Thermo King genset is mounted well forward on the chassis, just aft of the landing gear.
Monson's domestic business has been growing rapidly after the company's 1993 startup by Ron and his wife Linda. To handle the increased traffic, the Iowa terminal in Britt on US Highway 18 has been expanded , doubling the office space and increasing shop space by 50%.
Trucks go through a complete safety inspection every time they are in Britt. Service work usually means maintaining brakes and changing oil. The majority of Monson's service work is performed in the areas where drivers live. Drivers are hired where loads originate - near meat packing plants in Iowa, Nebraska, Kansas, Colorado, the Texas Panhandle, and Wyoming.
"We prefer to hire `meat haulers,' " Monson says, "drivers who can give us a 100% on-time record for our customers."
Driver hiring and retention have not been problems, Monson says. He attributes this to a number of factors, such as providing good trucks and running favorable traffic lanes. Hauling meat from the Midwest to Texas and the Midwest to California means that most drivers are home every weekend.
His drivers like the trucks that Monson buys - big trucks with big power. Most of the company-owned fleet consists of W900 Kenworths with engine horsepower of 525 and higher. The current favorite is the Cummins Signature 600. No truck in the fleet has less than 460 hp.
"We buy big power for two reasons," Monson says. "Driver retention and resale value. We originally planned to trade at 450,000 to 500,000 miles. However, the used truck market has been so bad that we decided to overhaul with rods and main bearings at 600,000 miles and run them another year. We are planning now to sell them at about 750,000 miles."
Besides putting his drivers in the best trucks and getting them home for a couple of days every week, Monson pays well. Top company drivers get 31 cents per mile, while entry level drivers start at 28 cents. New-hires with some experience start above 28 cents. The Monson benefit package includes a 401(k) plan, paid vacation, health insurance, and life insurance.
The Monson fleet currently includes 55 company-owned trucks and 35 independent contractors. Most of the company fleet was purchased through the Kenworth dealer in Des Moines, 120 miles south of Britt. Trailers are mainly Utility with some Great Danes. Refrigeration units are all from Thermo King.
One of the problems with big trucks with big power is the big fuel bill. Monson says that his trucks average 5.5 miles per gallon on trips to the West Coast. The North-South NAFTA lanes and the East Coast lanes run at lower speeds and average 6.25 mpg. The big engines are great for hill-climbing, but they are governed at 75 miles per hour. Drivers like the big horsepower, not because of high speed but because they make climbing hills easier.
Monson thinks he has a good insight into driver preferences. He used to drive himself, and his son Eric now drives full time. When buying new trucks, drivers have a lot to say about what they will drive, including selecting the color.
"We don't have a driver retention problem," says Monson.
