Managers Buy Out RTS

Five managers of Milwaukee-based Rock Transfer & Storage Inc. (RTS) recently closed on a deal to purchase the company from previous owner Richard Sheridan. Sheridan’s pending retirement prompted the newly formed executive team to begin conversations with him 18 months prior to the purchase, said Robert Hutton, the new president and chief executive officer of RTS.

The ownership team evolved with the intention of taking the trucking and warehousing company to the next level, Hutton said.

He declined to disclose the price of the sale. 

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In addition to Hutton, the executive team includes: Terrence Hogan, vice president of operations; Kimberly Haglund, vice president of human resources; Joni Sablich, vice president of business development; and Dawn Jasper, vice president of finance.

"We as a management team have been the nucleus behind the company for up to 15 years," Hutton said. "We have a commitment to the company and what it represents in the marketplace."

RTS has about 100 employees and specializes in transporting products for industrial manufacturers in the Midwest and on the East Coast through its transportation division at 6130 S. 13th St. and a warehousing service through its 87,000-square-foot public warehouse and corporate office at 130 E. Edgerton Ave.

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"The foundation of our warehouse operation is rooted in our partnership with the metal casting industry," Sablich said. "For over 25 years, we’ve provided critical inventory and distribution services to both the raw material supplier, as well the casting producer."

The new executive team has a vision to grow RTS into a larger trucking company with a regional presence through the addition of trucking terminals and by duplicating the current RTS operations in other states, Hutton said.

RTS plans to add more clients and employees as it extends geographically to better serve its current clients, Hutton said.

Although the executive team is still working out the framework for the growth plan, the group has established a goal of opening one trucking terminal per year in a different location, Hutton said.

The first new terminals will be in the Midwest, but the company plans to expand by eventually opening new terminals throughout the nation.

Sheridan, who purchased RTS in 1992 from the company’s founder, Leiland Martell, moved the company from the north side to its current location on Edgerton Avenue in March because of lease agreements, the need for additional space and its location closer to the transportation division, Hutton said.

"Part of our overall growth strategy is to enhance and market our warehousing services," Sablich said. "The purpose of our recent move was to provide us with additional capacity. We are now positioned to further offer the marketplace a variety of value-added services."

RTS currently employs 63 drivers for its 53 trucks.

To expand, the company will have to develop effective strategies for coping with a shortage of interested and qualified drivers, Hogan said.

"It will definitely be a hurdle, especially when we go to areas where we don’t have a foundation built or resources to pull from," Hogan said. "But we have been down this road before and are expecting (challenges) before they happen to avoid pitfalls.

"The biggest issue internally is pay," Hogan said. "There is only so high we can go with compensation and at the same rate there is only so much we can push the envelope to where it correlates with our customers."

The average truck driver in the United States is paid $16.56 per hour, or $34,444 a year, based on a 40-hour work week, according to the U.S. Department of Labor.

Hutton believes the RTS approach to the truck driver shortage is unique.

"The challenges still face us, but the type of company and approach we have toward business allow us to find ways to adapt to the demands," Hutton said. "We hire qualified people, have a good reputation in the industry and offer top-of-the line driving equipment."

RTS requires prospective drivers to have at least two years of driving experience, a clean driving record and a hazardous material endorsement, Hogan said.

RTS drivers receive uniforms and winter coats from their employer and are compensated for on-the-road costs, including tolls, meals and the option for per diem pay for stops, Hogan said.

Long-haul drivers are paid by the mile. Short-haul or day drivers are paid hourly wages, Hogan said.

Hutton said RTS has had little employee turnover.

"The quality of employees that reside at our company, from the drivers to the internal staff, were the driving factor in our decision (to purchase RTS)," Hutton said.

Hogan added, "All factors combined, our hiring process is longer and in depth and the timing sometimes does not work out for people. But in the end it does for us."

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