Skyrocketing to $765 Million With Steam Logistics President
The FreightCaviar podcast had an insightful conversation with guest Steve Cox, President of Steam Logistics. Steve took us through the company’s remarkable journey from adversity to astounding success. He also revealed the secrets behind Steam’s rapid growth, the company’s unique culture, and his inspiring leadership style that drives innovation and progress.
The Journey of Steam Logistics
Steam Logistics was initially conceived as the international division of Access America Transport in 2012. When Access America was sold to Coyote in 2013, Steve jumped over to Steam. However, having worked only in domestic, there was some struggle to adapt to the complex world of international logistics. “For about four years from like 14 to 18, all we did was fail,” Cox admits.
It wasn’t until 2019 that they finally found their footing by refining their product offerings and launching a drayage division. That year the company brought in a revenue of $33 million. Steam was the first company to enter the drayage market in Chattanooga. By leveraging their domestic and international experience, they quickly became a leader in the industry, growing their drayage division to $200 million in sales within just two years.
By 2022, the company’s revenue jumped to $765 million. “It was tough, I mean honestly, it was. At points, I didn’t feel like it was a viable company. I thought for a while we weren’t going to make it,” Steve says.
Today, Steam Logistics’ domestic product accounts for 60% of their business, and their first-quarter domestic sales have grown by 40%.
What’s the Secret Sauce?
Steve shares a straightforward philosophy when asked about the secrets behind Steam’s success: “When we were at Access America and previous from Steam, we went from 50 million to half a billion in five years, and people are always like, ‘Well, what’s the secret? What are you doing?’…I ran into that brick wall as fast as I could, and I backed up and did it again.”
Steve credits their success to a combination of factors, including a strong company culture, competitive pay, and an unwavering focus on employee success. He explained that the opportunity to change lives and provide financial stability for individuals from all walks of life is a driving force behind the company’s growth.
However, rapid growth isn’t without its challenges. Steve says the biggest problem is the recruitment and training that comes with expansion. Steam Logistics now boasts 11 branch offices across the United States, with plans for further growth.
“In 2019, when we made 33 million, we had 56 employees. At the end of last year, we had 896.”
How Steam Logistics Prepares For the Future
Despite the challenges of a tough market, Steam Logistics remains focused on its goals. With a targeted revenue range of $765 to $800 million for the year, the company is working on refining its processes, finding inefficiencies, and developing its own technology.
“We did 765 last year; we believe we need to be between 765 and 800 this year, and we think that’s a heck of a result in the market,” he explains.
This “launching pad” strategy aims to position Steam for rapid growth in the future, potentially doubling its revenue in a single year.
“If we can go from a billion to 2 billion in a year, that’s what we’re getting ready for this year,” Steve says confidently.
Steve’s Current Mission: Ending Non-Competes
Steve believes that non-compete agreements are detrimental to the brokerage industry. “We just don’t have them at Steam, and a lot of brokerages in the lobby don’t. I don’t care about them,” he says. He argues that they are predatory practices employed by large, bully companies and can negatively impact young talent in the industry. And worse, it’s a form of wage suppression.
Take for example, a 22-year-old college graduate who signs a non-compete without fully understanding its implications, Steve explains. When they receive a better job offer with higher pay a couple of years later, they’re stuck due to the non-compete. “As an industry, we lose talent because of that,” he says.
Steam embraces competition and believes that young professionals should have the opportunity to advance their careers. And if a former employee leaves to start their own brokerage? Steve says it should be welcomed because it ultimately benefits the industry.
But how can businesses protect themselves?
Steve supports non-solicitation agreements, which prevent employees from taking customers and coworkers with them when they leave a company. “Companies can protect themselves with a non-solicit,” he says. These agreements ensure that customers trust the company, not just individual employees, for essential services like carrier vetting.
Non-solicitation agreements are a fairer and more effective way for companies to protect their interests while allowing employees the freedom to grow and thrive.
Steve’s Logistics Inspiration? Ken Oaks
Steve holds Ken Oaks, the owner of an $8 billion company in the industry, TQL, in high esteem. Cox credits Oaks’ success to maintaining a high percentage of ownership without relying on acquisitions or taking on outside capital.
Steve learned from Oak’s approach of promoting internal talent to open up new markets. Branch expansion was also influenced by TQL’s struggle with finding talent in a single city. Steam followed TQL’s steps to open branches in other cities to tap into new talent pools.
Steve admires Ken Oaks for building a company from scratch and still being actively involved in the business.
Double Brokers and Steam Logistics
The pesky issue of double brokers affects everyone in the industry, and Steam is no exception. To counteract this, the company focuses on properly vetting carriers and ensuring they communicate directly with drivers to verify load information.
However, Steve says it really boils down to educating carriers on how to spot red flags. While the brokerage does all it can to ensure they don’t deal with double brokers, it doesn’t stop them from being impersonated.
How Leadership Works At Steam Logistics
Steve left us with a clear outline of his leadership style and explains how he shows up every day for his company and employees. Here’s how Steve is leading the way at Steam:
- Leading from the front: Steve always wants to set an example for his team by diving into tasks head-on.
- Promoting a culture of hustle: He’s always on the move, instilling a sense of urgency and drive in his employees.
- Persevering through adversity: It’s important to demonstrate unwavering determination.
- Prioritizing employee growth and development: Steve invests in his team by providing professional and personal growth opportunities.
- Fostering healthy competition in the industry: Steve embraces the competitive spirit and encourages his team to excel, driving innovation and progress while supporting other local businesses.
- Staying true to the company’s vision: Steve wants long-term success at Steam. Short-term financial gains don’t sway him.
- Being a fearless advocate for his company: Steve champions Steam Logistics at every opportunity, instilling a sense of pride and loyalty in his team.
Steve Cox’s dynamic leadership style has been instrumental in driving Steam Logistics’ meteoric rise to success. His dynamic leadership style sets a remarkable example for his team, inspiring them to tackle challenges head-on.