Heartland Express: Operating Model & Corporate Culture

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I've been a student of the US transportation market for years now. While exploring the space, I found this company called Heartland Express. When I visited their website, I saw they only do full truckload (FTL), and I found it intriguing. Every LTL carrier would tell you the last thing they want to do is full-truckload because it's commoditized. I started to understand the story of the founding family and realized these guys have been doing this profitably for a long time. They're doing something others don't want to do. I began digging into how they make it work. That's the overarching question of the interview, which is why I sent you all these questions beforehand. We don't have to go through them in order, but this was just to give you an idea of what I'm trying to understand here.

I saw a chart in the early 90s showing that of the top 100 trucking companies before deregulation, only four were still in business by 1990, because many companies didn't know how to operate under the new conditions.

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When you say some people have no idea how to run a trucking company and others do, what are the main guiding principles that separate them?

Heartland touts itself as a premier service provider and charges more than most other trucking companies for the same load, under the premise of delivering excellent service. If service is important to you as a customer, you might be willing to pay extra for it.

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Why does FedEx outsource this? Why don't they do it themselves?

It's challenging to find enough trucks and drivers, and sometimes it's cheaper to contract it out. FedEx needs to move their product regardless of whether the truck is full because they're selling a service. If they have a full truck of small parcels, like eight to 10-pound boxes, going from Portland to Los Angeles, but can't fill the truck daily, it might be too costly to run their own truck, so they contract it out. Additionally, the number of truck drivers in America has been decreasing over the last 10 years.

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