Most of the merchandise that moves around the United States travels by truck. According to industry advocacy group American Trucking Associations, trucks transport nearly 10 billion tons of freight each year—about 67 percent of the total freight traffic in the continental United States.
These numbers represent an intricate dance of loads and vehicles—hundreds of thousands of trucks hitting the road every day, each with a schedule that’s been planned down to the hour, if not the minute.
Who manages all that traffic? It used to be the individual carriers. But as the landscape became more complex, they found it made sense to subcontract the organizational work to someone else. And that’s how the logistics industry was born.
One of the fastest-growing success stories of the last seven years is Chicago-based Coyote Logistics. Founded in 2006 by Jeff Silver, a former executive at Chicago freight brokerage company American Backhaulers, Coyote went from startup to the middle market in record time. In 2012, Crain’s estimated the company’s five-year growth rate to be an outlandish 41,438 percent. Coyote currently sits at No. 26 on Forbes’ list of America’s most promising companies, with annual revenue of nearly $800 million.
That kind of growth would be impressive enough if Coyote were functioning in a young industry with few rivals. That it entered an already established market with plenty of mature competitors makes its success extraordinary.
One of the keys to Coyote’s rise has been its success in fighting “deadheads.”
That doesn’t mean the same thing to people in the trucking business as it does to the rest of us. For truckers, deadhead is slang for an empty backhaul: a truck that heads back to its point of departure without carrying a return cargo load. To a shipping company, a deadhead represents all the cost of a normal haul with none of the income.
Eliminating deadheads is one of the major functions of the logistics industry, and it’s at the core Coyote’s business model. Essentially, Coyote is a matchmaker, using its proprietary software to help pair empty trucks with cargo that needs to be moved.
Unlike many brokers that establish regional branch networks, Coyote has centralized nearly all its operations in one location, the company’s headquarters on Chicago’s West Diversey Ave. “This set-up creates massive efficiencies,” says vice president of Marketing and Communications Jodi Navta. With everything on one master network, an agent with a shipment to move can quickly find the nearest empty truck, searching across the live database of all the carriers Coyote works with.
Speed and reliability are key. As Silver told a Chicago Grid reporter: “There is a super-heavy service component to what we do and we thrive by servicing our customers like nobody else does.”
Silver and his team make a point of embracing the latest Internet-based tools, including social media platforms like Facebook and Twitter, as well as a mobile app—CoyoteGO—that streamlines interactions among drivers, shippers, and the company itself.
The staff includes numerous developers and a host of sales reps, many of whom were recruited directly from college. Coyote prefers to hire young people who are new to the industry, put them through a rigorous training and apprenticeship program, and promote from within. It helps to be located in the region’s major metropolis. “Chicago is an awesome destination for kids out of school—especially in the Midwest,” says Navta. “It allows us to attract top talent.”
If the result is a workplace that looks more like a startup than a middle-market powerhouse, that seems to be fine with Silver. He has an office that he uses for meetings, but he spends most of his time on the sales floor. “The open atmosphere supports our culture,” says Navta. “Everyone is here to help each other, because efficiency is the key.”