“We had been a company that historically owned its trucks,” says Chad Johnson, executive manager of Bailey’s Logistic Services, who oversees 50 vehicles used at locations in Denver, Salt Lake City, Oklahoma City and Birmingham. “When I joined the company, however, I saw an aging fleet that was racking up unexpected service expenses, and equipment breakdowns that were hampering customer service.

“Our mechanics couldn’t keep up, and trying to budget for transportation became a guessing game because repairs were getting out of hand,” Johnson recalls. “Equipment reliability also began to affect our performance, including some failed DOT inspections. If we missed a delivery due to an out-of-service truck, that meant calling customers and working with them to reschedule.”

Reliability is especially important at Bailey’s Logistic Services. “Our logistics operation began when we secured a contract with GE for delivering household products it sells through Home Depot,” Johnson explains. “All told, we’ll make up to 1,000 home deliveries to Home Depot customers per day during the busy season, but on average, each vehicle we operate will make about 18 deliveries per day.”

Bailey’s delivery service solutions include curbside, inside placement, and full assembly and installation provided by driver teams trained in the assembly and installation of a myriad of different exercise equipment, appliance and furniture products. The company originated in 2005 after being spun off from its parent company, Bailey’s Moving and Storage, a household moving company that started operations in 1952. The logistics business now represents about half of Bailey’s revenue.

Bidding process

To boost fleet reliability and improve budgeting control, Johnson turned to full-service leasing for Bailey’s Logistic Services. After several years with one leasing services provider, he decided to open the bidding process to a select few companies. In 2011, Bailey’s Logistic Services awarded a lease contract for three Kenworth T270s to MHC Truck Leasing, the local PacLease franchise in Denver.

“Price was a factor, but even more so was the level of service that MHC would commit to providing,” Johnson states, “including how they handled breakdowns. Another part of the equation was vehicle reporting, and so MHC committed to giving us data from the Kenworths.

“We wanted fuel consumption information, including miles per gallon and idle percentages, along with hard-braking reports,” Johnson continues. “We essentially wanted a report card on the vehicle and the driver so that we could see which drivers needed more training, and if we needed to adjust the way they operated vehicles. It’s easy to let a vehicle idle while loading and unloading and we saw idle times up to 45% with some of our drivers. Without these reports, we would have never been able to adjust their behaviors. Today, our idle times are less than 10%.”

Before fully committing to MHC and PacLease, Johnson took the company on what he calls “a long-term test drive.”

“We rented several Kenworth T270s for three to six months at a time to see how they performed,” he explains. “Before we would consider a full-service lease, we felt the condition of rental units and the service behind those trucks would be indicative of how MHC would work with us.”

The test drive that began in 2010 eventually led to more PacLease vehicles being put into service by Bailey’s Logistic Services. In 2013, 10 more Kenworth 270s were added to the Denver fleet, two T270s were placed into service in Salt Lake City and five more were fielded in Oklahoma City.

Savings at the pump

According to Johnson, vehicle performance is saving the company at the pump. “Our reports show our fleet average with the T270s is at 8.5 MPG compared to other trucks in the fleet that are getting up to 6.5 MPG,” he relates. “At the same time, the level of service at all the locations is consistent and top-notch. Additionally, our drivers say our trucks make a difference in their staying with our company.”

From a budgeting standpoint, Johnson says leasing takes away the unknown. “We know our lease payment so we can budget appropriately,” he adds. “Before, we couldn’t really budget. If one of our trucks broke down, we’d have to call around and get the vehicle towed and then find a replacement vehicle. We never knew how much it would cost to fix. Those were wild cards that played havoc with our business.”

Included in that business is a Bailey’s Logistic Services Kenworth T270 that is adorned with the Denver Broncos colors and logo and is dedicated to the football team. “Several years ago, we began work with the Broncos to become the team’s official mover,” Johnson says. “We worked with PacLease, which did a great job of getting us a T270 that we could put to work for the team with a special graphics package.

“While the truck is used year-round for various Broncos functions, its main purpose is to get equipment to the airport for away games and to the stadium when the Broncos play at home,” Johnson continues. “We then park the truck in front of the stadium and it instantly becomes a magnet for a constant parade of fans who want to get their picture taken in front of it.”

Today, Bailey’s Logistic Services continues to expand and grow in its current, as well as new markets. In early 2012, it opened its office in Birmingham, Ala. “In all cases,” Johnson says, “we take pride in providing high quality prompt delivery service.”