MDX Freight LLC, St. Louis, has been operating under the Midland Davis Corp. umbrella since Aug. 1, 2016. The freight brokerage company was previously owned by Keith Mallon, who now serves as its manager. “I had my own business for 13 years, and Midland was one of our customers,” he says.
Midland Davis, headquartered in St. Louis, collects and recycles many grades of ferrous and nonferrous scrap metals, paper, plastics and wood at its Moline, Illinois, location. The company also operates brokerage offices in St. Louis and Milwaukee.
The recycling and brokerage company purchased the third-party logistics firm in an effort to have more direct control over its freight services, Mallon says. In exchange, MDX Freight has received a more stable business environment as well as business resources it did not have access to before. One such resource is a credit department that is available to check the credit scores of prospective customers.
“It has been a huge positive,” he says of the credit department, adding that the company has not taken on any bad debt since the acquisition. In the past, before the freight brokerage company had a credit department, Mallon says, “We might have taken a risk on a customer who may have taken a long time to pay.”
MDX Freight says it is committed to providing competitive pricing, responsive customer service, quality transport equipment and flexible routes whether its clients need less-than-truckload (LTL) service across their home state or multiple truckloads delivered in the continental U.S., Canada or Mexico.
Mallon says Midland Davis accounts for 40 to 50 percent of MDX’s overall business. The recycling and brokerage company moves $2.5 million to $3 million in freight annually with MDX.
Regarding the company’s remaining clients, he says, “We are pretty well-diversified. If someone needs freight moved and they pay their bills, we are going to move their freight.”
MDX has hundreds of customers but deals with 80 to 100 customers in a typical week, Mallon says. The firm arranges the logistics for 500 loads per month on average, he says, for a yearly total that ranges from 5,000 to 6,000 loads.
”Bad things are going to happen, and how you deal with them will affect if your relationship will grow or not.” – Keith Mallon, manager, MDX Freight LLC
Success in the freight industry depends on more than the timely movement of products from point to point, MDX says on its website. Strong, long-term relationships with its clients and carriers that are based on trust, communication and mutual respect also are necessary components.
“We’ve always found that the best way to do that is to be as honest with them as you can be,” Mallon says. “Bad things are going to happen, and how you deal with them will affect if your relationship will grow or not. If mistakes were made on both sides, you need to share responsibility. If we made mistakes, we need to know that.”
The company also pays the agreed upon amount on time, Mallon says. “That is how good relationships continue.”
Networking for success
Mallon says MDX’s network of carriers numbered 1,300 as of late December 2018. He adds that a number of them travel only in certain lanes or use certain assets, such as flatbeds or vans.
The company’s freight moving services include drayage, expedited, full truckload, hazardous materials, LTL, multistep and over-weight and over-dimension loads. MDX also offers special services, equipment and insurance coverage:
- appointment for pickup/delivery;
- COD deliveries;
- contingent cargo insurance;
- driver assist;
- driver equipment (safety shoes and glasses, hard hats and ear plugs);
- freight storage;
- general liability insurance up to $2 million (double the industry standard);
- contingent cargo insurance of $100,000;
- inside delivery;
- lift gate service;
- lumper service;
- rider policies;
- scale tickets; and
- special permits.
For its recycling brokerage customers, Mallon says MDX does a number of blind shipments. That means the recycler doesn’t know where the load is going or where it came from, he says. “If the shipper knew where to ship it, it wouldn’t need the broker. Doing blind shipments is a big part of what we do for our customers.”
Mallon says he knows recyclers can be driven by costs when it comes to transportation services. By using MDX and other third-party logistics providers, recyclers can find the most cost-effective carrier without having to directly invest labor into that search. “It’s more labor-intensive for them to search,” Mallon says. “They don’t have the tools we have to search out trucks.”
Mallon says recyclers can make themselves more attractive to trucking providers by offering more hours for loading, such as a second shift or earlier receiving. “Trucks want to get on their way,” he says, adding that some recyclers have a reputation for taking more than two hours to load outbound trucks.
MDX says it shies away from customers that do not pay for driver detention. According to industry standards, the first two hours of waiting time are unpaid, with the carrier getting $50 per hour for each subsequent hour. With the electronic logs that are required to track hours of service in the trucking industry, drivers often can provide arrival and departure times for every haul.
Freight brokerage firms are required to have a $75,000 bond, Mallon says. He advises confirming that coverage before a recycling company starts doing business with a freight broker. MDX also offers contingent cargo insurance, which goes into effect if the damages to the cargo exceed the carrier’s insurance coverage.
Mallon says the company sends out a packet to new customers that outlines its insurance coverage.
Most of MDX’s new business comes from referrals from existing clients. “It’s the best advertising you can get,” Mallon says.
In the competitive freight brokerage segment, a good word can go a long way. But retaining customers hinges upon frequent and honest communication, he says. “You have to communicate well and stay on top of it.”