NASH FINCH CUTS COSTS WITH MORE BACKHAULING

LINDA PURPURA

MINNEAPOLIS -- More efficient use of its wholly owned contract carrier helped Nash Finch here cut transportation costs 3.5% over the past year, with increased backhauls a significant factor in the reduction.

Nash Finch has been making greater use of its contract carrier, GTL Truck Lines, to increase backhauls. The carrier, which currently has a fleet of 38 tractors and 70 trailers, became a part of Nash Finch in the early 1980s.

"We've always operated our contract carrier on a very limited scope and never grew the GTL business," said Jim Kwakenat, transportation manager at Nash Finch. "But today, with tighter margins in the grocery industry, one must be more concerned with costs, whether it be transportation, warehousing or within the corporate structure."

Regulatory laws give GTL greater flexibility in the types of products it can carry compared with Nash Finch's private fleet, Kwakenat explained. The private fleet consists of 504 tractors and 1,150 trailers.

"GTL has authority to haul any type of goods as a contract carrier in all 48 continental United States, which means that GTL is not as limited in scope as a private carrier," he said.

"We can use GTL as a contract carrier so we're not hiring a different third party to pull our loads," he added. "We're keeping the money in-house and gaining the equipment's residual value."