IN 2001 Dan Mims had a decision to make. His company, Mims Meat Company, was growing steadily. Deliveries to restaurant customers, including Dairy Queen, were getting farther from the company's headquarters and warehouse in Houston, Texas. He had to add more trucks and a service program that could support them from Mims' maintenance shop.
To ramp up the fleet quickly, Mims decided to lease equipment. Since 2001 Mims has leased a majority of its trucks and tractors. Last year, the foodservice distributor decided to lease new tractors through PacLease and its affiliate in Houston, Rush Enterprises. Mims Meat also leases refrigerated trailers from PLM Trailer Leasing.
“We turned to leasing when our Dairy Queen business exploded,” Mims says. “It really stretched the number of miles we were traveling. We did it to maintain our customer service. If a truck breaks down in Texarkana, that's a long way from Houston. I needed an organization behind me that could get trucks up and running as soon as possible so we could hit our delivery windows.”
Since 2006, Mims, who has been involved in the business since 1986 and owns the company with his mother, has leased 16 Peterbilt 379 tractors through a full-service lease with PacLease. Out of its fleet of 28 trucks, Mims owns eight tractors and four refrigerated straight trucks. Mims' decision to lease with PacLease enabled the company to handle its biggest growth year in 2006 when business soared by 20%.
Started 60 years ago
Mims Meat has been selling meat to Texas businesses for 60 years. Mims' father, A D, started a restaurant along with his two brothers and sister after World War II ended. In order to provide meat for the restaurant, A D began the meat business. Rationing for commodities such as red meat, sugar and flour was still under way after the war. Since rationing didn't apply to live cattle, A D bought a steer, had it processed and bartered meat to other businesses for sugar, flour, and other provisions he needed for the restaurant.
“My dad began selling miscellaneous cuts to restaurant patrons,” Mims says. “A friend got involved in drive-in theaters and asked my dad to supply him with hamburger patties. That's what got us started in this business.”
As business grew in the 1950s, Mims Meat added delivery service. By 1962, the company had moved into its current warehouse facility near the original restaurant location. Mims eventually sold the restaurant, including a second location that still exists as the Dinner Bell Cafeteria.
Around 1970, the Dairy Queen business literally walked in the door. “One day a man walked in who was running Dairy Queen stores in the Houston area and asked my dad if he would sell them some hamburger patties,” Mims says. “We did the ground beef patties and then they wanted to know if we could sell them other things, such as hot dogs and fish. We have grown and evolved right along with them.”
More than meat
Today, Mims Meat's 110 employees supply meat and just about everything else to 240 Dairy Queen restaurants in Texas and a couple just across the state line in Arkansas and Oklahoma. Mims Meat also distributes products to more than 500 other restaurants and business cafeterias, between 20 and 30 health-care accounts such as nursing homes, and at least eight other meat distributors.
“We supply everything from mop buckets to prime rib,” Mims says. “When we go to a restaurant, we try to sell them everything they use. We handle paper products, canned goods, frozen vegetables, cleaning supplies, utensils. We do everything but equipment.”
Mims adds that the non-food business started in late 1980s. Economics at the time dictated a change. “We had to make a decision that if we wanted to continue what I call store-door business, we needed to get delivery drop sizes up,” he says. “The more you could unload at a restaurant, the better off you would be. It was the way our industry was evolving. Restaurant operators want fewer delivery suppliers coming in their back door. For example, the Dairy Queen restaurants get two deliveries — ours and the bread company.”
Mims Meat carries about 5,000 line items. The meat items range from patties to steaks, specializing in beef and pork. In addition to distributing other producers' meat products, Mims Meat also processes its own beef products and packages them under the private labels of other distributors. For several years in the 1970s and 1980s, Mims Meat operated a slaughterhouse in Lufkin, Texas.
Warehouse expansion
Mims Meat has operated out of the same warehouse location for 45 years. The original space has been expanded at least half a dozen times to its current 37,000 square feet. The warehouse contains 8,700 square feet of dry storage space, 7,300 square feet of freezers, and 3,700 square feet of refrigerated area, plus space for meat processing. The building has nine dock doors for loading its trucks and another dock for unloading incoming vehicles.
“We're not in the produce business but we do deliver produce as a convenience to our customers,” says Dan Mims.
Mims Meat also leases a 20,000-square-foot warehouse in Houston for additional dry storage. The company ships dry orders from its main warehouse first and replenishes inventory and fills occasional day orders from the secondary warehouse.
Customers can order online, via fax, or with one of Mims Meat's six sales representatives. Dairy Queen stores typically order 50 items at a time from a list of about 200 line items, according to Mims. Other restaurants, which range from sandwich shops to steakhouses, usually order 20 to 30 items at a time.
Deliveries are made once or twice a week, often determined by a restaurant's on-site storage space and volume. Delivery routes, driven by the company's 25 full-time drivers, vary from day trips to overnight routes that return the next day. Stops range in number from seven or eight on the higher mileage routes covering as much as 750 miles roundtrip, up to 16 stops for local routes within about 100 miles of Houston. Routes stretch as far west as the San Antonio area, north to Texarkana at the Arkansas state line, south to Corpus Christi, and east into Louisiana.
In addition to the 28 straight trucks and tractors, Mims Meat recently leased a new Peterbilt model 220 cabover, one of the first of the new model to be leased through PacLease. Mims says he will try out the new truck to see how it performs as a possible replacement for some of the other straight trucks in the fleet.
The Mims Meat fleet includes 20 trailers manufactured by Great Dane and Utility. Mims leases 16 trailers from PLM Trailer Leasing that are equipped with Carrier refrigeration units, and owns four trailers with Thermo King refrigeration units. The trailers range from 28 to 48 feet, with most of them being 48-footers, according to distribution manager Mike Germany. Straight trucks carry Morgan 20-foot or 24-foot refrigerated bodies.
Trailers are divided into three temperature zones — 0°F for frozen, 35°F for produce and other perishables, and ambient temperature for non-perishables. Mims says he experimented with center dividers on some of the trailers but didn't achieve the results he was seeking.
The Mims Meat president says his loading employees are faced with the challenge of balancing trailer loads. Frozen foods in the nose of the trailers weigh considerably more than dry items such as Styrofoam cups placed at the rear of the trailers that have more bulk than weight. He says one of the benefits of working with PacLease and Rush is that he was able to spec the Peterbilt tractors with the steer axle set forward to help balance the weight over the axles.
Right leasing package
Mims says the PacLease decision process took place over about eight months. He was looking for the right combination of leasing terms and quality equipment and says he found PacLease to be the most creative in assembling the financial terms and conditions.
“We looked at a number of things,” Mims says. “Fuel economy was important. I estimate we spent 40% more on fuel last year because of higher fuel prices. Good fuel economy is obviously important.
“We also wanted reliability. Downtime is expensive. When I have a driver sitting on the side of the road, it costs $60-$75 an hour for that truck. When that happens, we're not making deliveries and we're losing profit on those deliveries. It's a customer satisfaction issue. Our customers expect us to hit our delivery windows. If we miss them by more than 30 minutes, that's a problem.”
Driver safety, visibility, and comfort were also important considerations. “One reason we went with Peterbilt and PacLease is because of the very competitive market for truck drivers,” Mims says. “The better the equipment you put them in, the easier it is to recruit.”
Mims also appreciates the on-schedule maintenance program through PacLease. Routine maintenance is usually performed at the Rush facility about five miles away, although a Rush technician will even visit the Mims Meat location to make an occasional repair. Mims Meat still employs two mechanics to service its owned trucks and to work on other equipment. The mechanics also handle quick repairs such as replacing a burned-out light bulb.
“Our trucks turn and burn,” Mims says. “They don't spend much time in our yard.”
By leasing trucks, Mims Meat also was able to update its fleet immediately without straining the corporate credit line, according to Mims. Buying 16 trucks would have been tough financially. “Plus, they keep meticulous records so that any time an audit or inspection comes up, we're ready,” he says.
Like most successful businesses, Mims Meat focuses on meeting customer needs. That includes choosing the right trucks and leasing program to help support its deliveries. After 60 years in business, the company clearly has found the right formula.
Leased trucks spec'd for performance
MIMS Meat's Peterbilt trucks are equipped with Cummins ISX 15-liter engines rated at 475-horsepower and driven through Fuller 10-speed transmissions. Componentry includes aluminum wheels, hubs, fuel tank, and battery case, and motorized mirrors. Driver features include an AM/FM radio with CD player and cab air suspension.
The trucks also are equipped with the PacTrac on-board computer — available through PacLease — for tracking the vehicle and driver. Mims Meat President Dan Mims says his company uses the system several ways.
“We can review the previous day's run to determine if a driver was running the route as prescribed or if there were any unauthorized departures from the route,” he says. “And if a customer calls inquiring as to when to expect his delivery, we can locate the truck and give an approximate time of arrival.
“We can also use PacTrac to help in fuel tax reporting, and we can monitor our drivers' practices to determine if they are doing anything that have a negative effect on the fuel mileage or engine life,” he says. “Bottom line is that without PacTrac we have no way to effectively manage our fleet once our trucks leave the yard.”
