The formula for success is unchanged at Recon Logistics.
In the 2012 Lake-Geauga Fast Track 50, Recon Logistics is recognized as the No. 1 Established Company. Last year, the Auburn Township freight-management business founded nearly eight years ago by Hank Newman was recognized as the Fast Track 50′s No. 1 Emerging Company.
“Boil it down to faith or whatever, but I believe if we build the best operations model and do things the right way, transparently and while making a fair profit, growth will come,” Newman said.
Indeed, the growth of Recon Logistics has been steady, bordering on spectacular, since the 47-year-old Newman first set up shop in 2005 in the basement of the Auburn Township home he shares with his wife, Brigid, and their six children.
Newman said gross receipts have risen from $385,000 in 2006 to $25.5 million in 2011. ”We’ve now had growth in 28 consecutive quarters and expect to increase this year,” he said. According to Newman, Recon Logistics has 19 employees and 75 to 80 clients. While the majority of those clients are small to mid-size manufacturing companies based in Northeast Ohio, Newman said Recon Logistics also has clients in California, Colorado, Massachusetts, North Carolina, South Carolina and other states.
A self-described “introvert and hands-on perfectionist,” Newman points with pride to his company’s record of never having lost a customer. ”I know we will lose a customer someday. No company in the history of this planet has been around for any length of time and not lost a client,” Newman said. “But when it happens, I’ll be darned if it’s going to be our fault.”
“Transparency” is the buzzword frequently used by Newman to summarize the business practices of Recon Logistics. For a flat, monthly service fee, Recon Logistics works with its clients to move manufactured goods in widely varying quantities from the manufacturers to their customers in a timely, cost-effective manner. Recon Logistics uses software programs that receive input from a nationwide array of freight shippers. The primary mode of transportation for those shipments, Newman explained, is over-the-road trucks.
Why would manufacturers engage the services of an outside party to handle such shipments? ”We are experts in freight negotiation and rate makeup,” Newman said. “We save people money and we save them time. Whether the economy is going up or down, there is value to that.”
Cost predictability, reflected in the established monthly fee, is another key element of the service provided by Recon Logistics. ”Many other third-party logistics companies do the work we do, but they act as middlemen and mark up all the transactions,” Newman said. “With us, everything is transparent. Customers know exactly what they are paying for.”
Newman said Recon Logistics offers “an average savings of 30 percent” to companies that typically spend $500,000 per year on shipping.
With benefit of hindsight, Newman said he began acquiring the expertise he now brings to bear while majoring in logistics at John Carroll University. A 1984 graduate of Kenston High School and 1989 graduate of JCU, Newman formerly owned his own trucking company. After getting out of that business in 1994, he handled logistics for various major corporations before founding Recon Logistics.
The success of Recon Logistics has been noticed inside industry circles. Newman said he’s heard rumors of bigger companies possibly wanting to acquire Recon Logistics.
“I don’t envision selling,” Newman said. ”I’m having fun doing this. Especially in a small, growing business, there are opportunities to innovate, employ people and empower them.”