Lazer Spot, Inc.
The Big Dog in Yard Transportation
Alpharetta, Georgia USA
October 31, 2019
By: Evan Armstrong
Adam Newsome, CEO
Phil Newsome, COO
Bob Wright, EVP-Fleet Operations
Will Rozeboom, VP-Solutions Designs
Lazer Spot Overview
Lazer Spot was founded in 1996 when two regional trucking executives approached Keebler Foods about starting a brokerage business. Instead, the potential customer suggested the two might consider bidding on the yard management work, as its existing spotting provider had just raised rates. Amazingly, they were awarded the business despite having no equipment and no drivers. When the incumbent spotting provider said it would stop providing service at the end of its next shift, the new business owners hurried over to a used equipment dealer, where a salesperson agreed to drive the truck over to the customer’s facility and show them how to use it. Neither had ever driven a spotter truck before and they were both wearing suits when they arrived for their first night on the job. It was a memorable first night, with the truck breaking down and leaving grease all over the suits of its new owners, but Lazer Spot, Inc. was born.
From those humble beginnings, they grew the business with blue-chip customers including Unilever, Georgia-Pacific, Inland Container, Owens Corning, and Pactiv reaching $40 million in revenue in 2007 with 95 operations across 20 states. In 2010, Lazer Spot received its first private equity investment allowing one of the founders to retire and securing necessary capital for growth under the leadership of Wes Newsome. In 2011, it began services in California and reached 190 operations in 27 states. In 2015, its revenues exceeded $200 million, and Lazer Spot received an equity investment by Greenbriar Equity.
In 2019, Lazer Spot made its first acquisition acquiring Mesko Spotting Service adding $22 million in business. With 2019 estimated revenues of $315+ million, Lazer Spot has grown to be a domestic yard transportation management leader serving more than 100 customers with over 400 operations in 38 states and Canada.
Lazer Spot U.S. and Canada Operating Network
Lazer Spot’s core service offering is to provide highly integrated and engineered trailer spotting, shuttle, and trailer yard transportation management services to shippers and third-party logistics providers. As part of its offering, Lazer Spot’s Solutions Design group frequently engineers and designs yard layouts for customers, optimizes shuttle/spotter routes and tasks, and develops key performance metrics and informational systems dashboards to track operational performance. The goal is to run safe and efficient operations which reduce customers’ operating costs and minimize carbon dioxide emissions. According to Lazer Spot, over the past three years, it has saved customers two million operating hours and three million of diesel fuel costs while eliminating 27 million pounds of carbon dioxide emissions.
To achieve these results, Lazer Spot has built a management structure tailored to support decentralized decision making at the local customer operation level.
With a large national network, many customer operations are arranged in geographic clusters allowing Lazer Spot to flex cross-trained labor and equipment between multiple customer sites to handle surges in demand. Lazer Spot defines this ability as creating a “surge site cluster” and its flexibility provides a significant value-add for customers, especially during the retail peak season.
Geographic Clusters can Flex Labor and Equipment to Meet Demand Spikes
Lazer Spot’s customer retention rate is over 90% and none of its 100+ customers represent more than 10% of revenue. Its revenues by customer industry are shown in the figure below.
Revenue by Customer Industry
Lazer Spot has invested heavily in information technology to manage and provide visibility to its trucking fleet and to interface with customer Warehouse Management Systems (WMS) and Yard Management Systems (YMS). These solutions allow it to deliver synchronized spotting and shuttle services to customers.
Key systems components to manage Lazer Spot’s network include Geotab Telematics fleet management software providing it with truck equipment management and real-time GPS tracking. In addition, Lazer Spot utilizes Noregon’s Tripvision Uptime application which proactively notifies personnel prior to equipment failures and helps maintain preventive maintenance schedules. With this systems’ “backbone”, Lazer Spot knows the position and status of its equipment in real-time.
Tripvision Screen Showing Equipment Statuses
To proactively identify and develop process improvement solutions and provide customers with cost and performance information, Lazer Spot has built custom reports and dashboards within its Salesforce Customer Relationship Management (CRM) system. Its customer portal allows customers to run ad hoc queries and reports. Some of the Key Performance Indicators (KPIs) Lazer Spot tracks for customer operations are:
- Monthly hours and moves per customer
- Average moves per hour
- Average idle time percentages
- Number of trucks, trailers, and drivers onsite
- Total spend for spotters, shuttles, and gate clerical
- Total spend for trailers and fuel
- Safety quality
- Driver turnover percentages
Customer Site Visits
During our visit to Lazer Spot, we had the opportunity to visit two very distinct customer operations. These are detailed below.
GE Appliances Distribution Center Spotting Operation – Commerce, GA
In February 2019, GE Appliances opened a new 299 dock door distribution center in Commerce, GA and tapped Lazer Spot to manage its trailer spotting. The operation currently has one spotter truck and a spare truck supporting the site’s 12-hour/5-day a week distribution operation. When the operation is fully brought online, the distribution center will require four spotter trucks plus a spare. Lazer Spot provides customers with a spare truck as a backup for all of its operations. The operation is also part of a surge site cluster, so spotting equipment can be brought in to support spikes in demand as needed. The operation is overseen by Area Manager, Manny Greenwell, who is also responsible for Lazer Spot’s local HomeGoods, Reckitt Benckiser, and ULINE operations.
Lazer Spot is integrated with the customer’s YMS to manage tasks between the warehouse and the spotter driver. During the morning, the spotter drops empty trailers into assigned dock doors for loading, and in the afternoon, loaded trailers are repositioned in the yard for carrier pickup. To ensure operational efficiency, Lazer Spot worked with GE Appliances in designing the yard layout. As a safety measure, it also developed a way to secure swing doors on trailers to avoid injuries during loading and unloading.
Kubota Manufacturing JIT Manufacturing Support Operation – Gainesville, GA
Lazer Spot has been supporting Kubota Manufacturing America’s (KMA) Gainesville, GA manufacturing operations since 2011. The manufacturing operation is based in a large free-trade zone where Kubota manufactures lawn mowers, utility vehicles, and yard tractors. Lazer Spot manages day-cab shuttles from KMA’s local parts and components vendors to Kubota’s onsite warehouse, JIT (just-in-time) movements of parts and components from the warehouse to multiple manufacturing lines, and the transport of finished products to KMA’s national distribution center in Jefferson, GA. To support the operation, Lazer Spot manages 70 drivers and maintains a fleet of 18 spotter trucks, 34 day-cab tractors, and over 200 dry-van trailers. It manages approximately 1,000 trailer moves per day. To ensure operational performance is met, each piece of equipment utilized in Lazer Spot’s KMA fleet is inspected daily to avoid service and safety issues.
The JIT manufacturing line-feed part of the operation is supported by six tractors and trailers. It has tight pickup and delivery windows and runs with 10-minute cycle times from the warehouse, where Kanban component sequencing and trailer loading is performed to KMA’s four manufacturing facilities.
Each morning and evening Lazer Spot generates a report for KMA showing the status of each trailer in the operation detailing its location and if the trailer is loaded or empty.
Lazer Spot holds quarterly business reviews with KMA. KPIs for the KMA operation include:
- Average moves per hour
- On-time performance
- Number of trucks, drivers, and trailers utilized
- Total spend by category
- Safety quality
Lazer Spot Operations Summary
Lazer Spot has grown from humble beginnings to gain a leading position in yard transportation management. With its large national network and information technology backbone, it provides customers with significant cost savings via flexible operations engineered for improved labor and fleet management. We anticipate Lazer Spot will continue to grow its North American network building additional scale to further its service value to customers.
Sources: A&A Primary Research, http://www.lazerspot.com