Home delivery of appliances or furniture can be a stressful prospect for all parties involved.
Customers generally need their orders filled sooner rather than later. Those who make the deliveries must avoid damaging anything during the process.
That degree of difficulty is precisely why J.B. Hunt Transport Services Inc. is investing in its Final Mile service.
J.B. Hunt, one of the nation’s largest transportation companies, is becoming increasingly interested in filling jobs that other carriers might have little interest in pursuing. It views Final Mile as one of those areas.
“We’ve taken the philosophy the last several years that the harder the opportunity, the better,” J.B. Hunt Senior Vice President Tom Lastovica said. “The harder it is to execute, the more likely it is that we’ll be successful at executing the operation and retaining the business. A lot of our competition goes after business that is easier to operate, and those customers are more difficult to protect. A lot of the dirtier, harder business is where we thrive.
“We’re able to build much better relationships with our customers as a result. They appreciate the effort that it takes to perform those services.”
Lastovica oversees Final Mile, a category of the company that falls within J.B.Hunt’s Dedicated Contract Services segment. Final Mile specializes in hauling furniture, appliances and similar products for commercial and residential customers, and it is targeting between $185 million and $200 million in revenue for 2014.
J.B. Hunt began offering its Final Mile service nationwide in 2009, and five years later is targeting between 15 percent and 20 percent growth annually. From 2010-13, the total growth was 30 percent for Final Mile.
While the company’s traditional long-haul trucking segment struggled, its willingness to take on tasks and clients that other companies would prefer not to has helped that growth. Outside observers say that’s what separates J.B. Hunt, which reported $5 billion in total revenue for 2013, from competitors and helped it grow into a Fortune 500 company.
“J.B. Hunt continues to be innovative in meeting needs someone else hasn’t thought of,” said Shannon Samples Newton, vice president of the Arkansas Trucking Association. “They’re more diverse than any other trucking company we’d be comparing them to, really.”
Initially, Final Mile began with deliveries out of a single Whirlpool distribution center in Little Rock, which led to work in Tulsa, Springfield, Mo., and Wichita, Kan. Whirlpool then tested J.B. Hunt in Los Angeles and Baltimore before working out an agreement for the trucking company to take over all the distribution centers.
Today, the network includes 1.5 million square feet of space spread over 90 distribution centers that the company said are within 150miles of 98 percent of the country’s population. Combined with ample access to equipment, J.B. Hunt sees itself positioned well as online retailers look for cost-effective ways to deliver products to customers. Amazon.com has contracted with J.B. Hunt for appliance delivery in the northeastern United States.
J.B. Hunt also handles residential delivery through Final Mile. And it has contracted for store replenishment with appliance retailers. Finished doors and windows for new home construction are also areas where J.B. Hunt could grow its business, but tapping into what Lastovica calls “etailers,” or online retailers, is one of the largest areas of growth potential.
Appliances Connection, an online retailer offering 30,000 appliance and furniture products from more than 500 brands, began using J.B. Hunt for delivery of its orders late in 2013. They’re about six months into a three-year contract, said Harold Lane, head of marketing for Appliances Connection.
Lane said his company learned of Final Mile because of an order made through Amazon.com. A J.B. Hunt employee made the delivery and piqued interest from Appliances Connection.
“They delivered something to us and that led us to make a call,” Lane said. “We’ve felt they have good service and understand how to deal with customers. They’re professionals, something you don’t find with other carriers.”
Lastovica said Final Mile employees are put through “rigorous” training to prepare them for those potentially high stress interactions with customers. Final Mile drivers are the only drivers the company puts through a formal customer service training program, and they’re tested on installation ability inside a mock kitchen. During deliveries, employees wear J.B. Hunt uniforms.
“When that person shows up at your door, it’s somebody you feel comfortable letting in your house,” Lastovica said. “They’re not showing up in a panel wagon or pickup wearing cutoff shorts and a T-shirt. That’s really the first step in how we try to put people’s minds at ease.”
Business, Pages 73 on 03/23/2014