Episode 52: Navigating Government Contracts in Logistic...

Intro – 00:00:01:

Welcome toFreight Nation: A Trucking Podcast where we explore the fascinating world of trucking and freight management. We dive deep into the freight industry and uncover why the trucking industry is more crucial to our country now than ever before. Stay tuned to uncover the driving forces behind successful trucking businesses and hear from the hardworking truckers and leaders who keep the world moving. Let’s hit the road.

Brent – 00:00:26:

All right, well, welcome back to Freight Nation, a podcast by Truckstop. Man, I’m so glad that you’re joining me today. We know that you have a lot you can do with your time because the trucking industry is busy. Boy, is it busy today. It’s an honor to us that you would like to give us your time today to further your career, further your time inside of transportation. And that’s what Freight Nation is all about. That’s what Truckstop is all about. We’re here to help. We’re always here to help. And we want to bring those significant people that have done really unique things inside of transportation to be a part of Freight Nation, be a part of the podcast. So you can hear their story and you can really hear the unique things that apply to their business that you can apply to your business because we all want to help each other succeed in Freight. And that’s what Freight Nation is all about. And so, boy, we’re glad that you joined us today. We’ve got a really fun episode today. Somebody’s going to teach you something about something that’s really complex. And I don’t just mean like being in business. And we’re going to talk a lot today about what it might be like to do business with the government and what it’s like to scale a business and what it’s like just to be a leader in the industry. Because we need more and more leaders in the area of transportation. And we’ve got a great one for you today. Joining me today is Ms. Melanie Patterson, who is the founder and managing director of Integrity Global Logistics out of Chicago. Melanie, thank you so much for being a part of the Freight Nation podcast today.

Melanie – 00:01:40:

Hello, Brett. Thank you so much for inviting me on and having me here. I’m so excited.

Brent – 00:01:46:

Well, what’s interesting is as I was looking at your profile on LinkedIn and everything, it seems like you’re excited about a lot of things.

Melanie – 00:01:54:

I am. I’m super excited about the transportation industry right now, especially adding the government as one of your customers. And you know what? There’s no shame that’s oozing out of me. I think we have a lot of people in the industry who are telling you about the great things about the industry, the bad things about the industry, but very few talking to you about the government. And so I’m excited about it.

Brent – 00:02:20:

So before we get into the business part of the podcast, I always like for people to know people. So tell me a little bit. What keeps you so hopeful and joyful? Because that’s not something that you manufactured. You typically you wake up that way. So what drives Melanie to have that joyful attitude? All right.

Melanie – 00:02:40:

I think for me, one thing that pops out right here that I keep on my desk is…

Brent – 00:02:45:

Winston Churchill quote. Yeah, I got that. I got the same one. My dad bent that into me when I was a kid. Never give up. So tell me how that motivates you.

Melanie – 00:02:56:

To be transparent and vulnerable on this platform, I’m a youth that comes from adversity. I’m a kid from Chicago who graduated from an alternative high school. And I figured it out eventually. As you stated, I went on to medicine. So I got my bachelor’s degree. I got my master’s degree. And so I say all of that to say that I’ve been through quite a bit. I’ve been through some adversities. And one thing that I know is so important is to maintain a positive mindset. And that’s what I choose to lead with every morning. My alarm goes off at 445 and I command my morning. I command my day, which ultimately will command my week, my months, my life. And that’s what you see. So it is very intentional.

Brent – 00:03:40:

Right. Well, that’s super cool. I like the way you talk about attacking life every single day you get up. It’s funny because most people talk about when you see somebody that’s created success, they go, well, they always want to know how a person did it. And usually it comes back to just what you said, intentionality and then hard work. Stay it at it.

Melanie – 00:03:58:

For sure. The hard work is very essential. One thing that I say to myself and that I share with my mentees and my colleagues is the vision is cool, but it’s the execution behind the vision that’s going to yield the results. And so being intentional and executing is really where that secret sauce lies.

Brent – 00:04:18:

Yeah, for sure. All right, hold on. You just brought up something that anytime somebody asks me about good ideas, I always talk about, man, there’s so many great ideas out there. The difference is who can execute. Talk a little bit, because Melanie, we’re going to talk about your business, what got you into it, where you came from, because you have a really cool entry point into this. And I’m going to let you tell that story. And then not only did you develop a business, you developed an advice-giving business where you’re mentoring people in their business, which is really giving back, which is super cool. But tell a little bit, before we jump into those sort of three things, and then talking about the specifics about government contracting and stuff, man, you just opened the door. Execution is everything. It’s just everything. Talk a little bit about that to the Freight Nation watchers and listeners.

Melanie – 00:05:02:

Yeah, absolutely. Right now, it’s really an important time to get back into your business, fall back in love with your business, and really understand the place of a leader within your business, right? Go ahead and execute on getting your business from where it is right now to the next level. And so that’s really an internal decision that needs to be made. Of course, I went through a lot of adversities. And one of the toughest things is business ownership, right? It takes a special person. But how about a small business in the transportation industry in this current marketplace, right? Yeah, we got to get back in our business, get our hands back on the wheel, so to speak, and really understand it’s so important to start to market our business and showcase our added value to our customers for sure.

Brent – 00:05:54:

Yeah, well, you talked about something about what makes a business owner an entrepreneur. What’s the difference? And you showed a little sign there that said, never give up. And it’s usually the ones that won’t give up that find success because it’s not easy to do. And adversity is part of any success story. There’s no doubt. If you don’t have adversity, it probably wasn’t worth it.

Melanie – 00:06:13:

Yep. Very well said.

Brent – 00:06:15:

And I’m not saying adversity where you ended up being in a situation that you didn’t create of your own. I’m talking about just the adversity of doing things that are hard, that are difficult, because if business success was easy, everybody would have a successful business. And they don’t. They just don’t. All right. So let’s talk a little bit about Melanie, because I really want people to hear about your path because this is the fun part before we get into business operations part. The fun part is how you got from what you started your career out into logistics. Talk about that because that’s a fascinating story that the Freight Nation watchers and listeners are going to love to hear.

Melanie – 00:06:50:

Come along with me.

Brent – 00:06:51:

Yeah, you’re good.

Melanie – 00:06:52:

All right. So I alluded to a little bit early on in the call that I graduated from an alternative high school. My high school principal believed in me, and she said, I’m going to sponsor you, and I want you to go on to college. It’s something special about you. You’re not just like one of these other students. And so I went to school in Tuscaloosa, Alabama.

Brent – 00:07:11:

Well, time out, time out. You know where I live? I live in Tuscaloosa, Alabama. The guy that’s my partner on our nonprofit called Elevate USA went to Stillman. Oh, my goodness. That’s amazing. It’s amazing how things are connected.

Melanie – 00:07:26:

I know, right? Small world. And so that’s where it all started for me. But I majored in business management and administration. So I did that for a little bit. But God said, I have other plans for you. And so I went off to an internship in Beverly Hills, California at Cedars-Sinai Hospital, and I shadowed a nurse in NICU and I fell in love. And so I went down the path of nursing and I got really involved with the world of corporate. So I climbed that corporate ladder, starting out with my bachelor’s degree, my master’s degree, all the accolades behind me to be competitive in the corporate setting. But I was left empty. I felt like there was more for me to give. I, at that time, had small children and I was an ER nurse. So ER trauma was my thing. And so it reminds me of transportation. One essential worker to another. And so I was missing Christmas mornings. I was missing Thanksgiving with the kids. And transparently, I was an investor on the side. And so I said, what would it look like if I just jump into entrepreneurship full time? So friends told me, hey, take a look at the trucking industry. You need to check out the trucking industry.

Brent – 00:08:40:

What year was this?

Melanie – 00:08:41:

This was in 2020. And they said, you need to take a look into the trucking industry. And I said, oh, absolutely not. It’s just too much risk there, right? Well, here we are, right? Here we are. And so.

Brent – 00:08:54:

Because you won’t give up.

Melanie – 00:08:56:

I never give up. And so really, actually, the industry, it’s for me. I am one of those girls that have a tough skin. I went on to launch Integrity Transit Company, had a fairly nice size fleet. And I quickly realized this is a very saturated and very competitive market.

Brent – 00:09:13:

For sure it is.

Melanie – 00:09:14:

I said, how am I going to leverage myself? Now, mind you, I know. I know a little bit about business, had a few companies underneath me at that time. And so I did the legwork and I did the research and I discovered government contracting. And that is really how we got to this empire of Integrity, global logistics, Team Integrity Knowledge Center and things of that nature.

Brent – 00:09:36:

Yeah. All right. So Alabama to Beverly Hills, then to Chicago. You’ve been investing in your future all along the way. Getting the education then, experience. And then you started looking into the marketplace and realized in 2020, the marketplace was exploding, right? Because after right as I started coming out of the two week quarantine, we were all going to be in, right? Just two weeks. It ended up being two years. So you decided to get in the logistics industry and get the logistics marketplace. As you were going through it, you started finding different success in different areas, but you obviously pivoted to the government side, which is, I applaud you, Melanie. I mean, I’m like, I know what it means. I know how to do business with the government. It takes a special person with a special amount of patience to be able to work with the government. So before we get into the government side of this, what were some of the things you learned when you first got into logistics that helped you sort of learn along the way?

Melanie – 00:10:37:

That’s a very loaded question, but to bring it all in, one of the things that popped out initially to me in managing of a fleet, really the importance of educating those drivers while they’re bucketing docs, while they’re out there on the road. There’s no secret. Transportation is a heavily regulated industry and is becoming more regulated. And so education with safety was definitely a great learning point for me. But most importantly, understanding your numbers, really understanding your break even operational cost. So to be honest, there was a lot of money coming in, but there was a lot of money going out. And if you don’t understand how to capture those numbers, how to be fuel efficient, right? Making sure that your equipments are, are maintained while out there on the road. We were true over the road team referred and so those were some great robust, learning lesson for me in my journey. How did I bring it all together in, understand to pivot? I think, really , just really watching the market and seeing the trend of what was happening. As you just said, 2019, 2020. We did very well, we were in the boom of COVID, at that particular time, those who are in business, no, that’s going to plateau. At some point.

Brent – 00:11:49:

You were one of the smart few that knew that was going to plateau. Most people thought it was going to continue for a longer time. So keeping ahead of the data was something that was obviously key.

Melanie – 00:11:58:

There you go. Really trending the data is what kind of helped with that. And you know what? I got a secret. What really helps is the government. You know what’s going to happen before it happens as a government ender. So they will reach out to me. I was the prime sole awardee for the full state of Illinois for full emergency management, right? So we were the one delivering hospital beds, respirators, dialysis machine, gloves, hand sanitizers. And so we’re privy to a little bit more information than the public. And so with that, you know what’s going to happen. And then just naturally, just as a leader and executive of your business, you’re trending that data to see what is going to happen next, what is forecasted for your business. And so understanding not to acquire all of that equipment, understanding that it’s going to soften. And come down and also leveraging the government as my customer, being that they’re the largest, we didn’t have to just stay in the reefer lane, right? We were able to bring about that diversity and step into flatbed. We stepped into courier service. And so there’s a lot of different verticals under the umbrella that helped us to survive.

Brent – 00:13:10:

Wow. So you kept iterating your business into new segments to grow your business. Now, let me ask you an important question because I don’t think I’ve ever asked anybody this on Freight Nation before. So how much time do you spend looking at the market data to determine the direction of your business?

Melanie – 00:13:29:

So for me, I like to take a look at it daily, at least one hour a day. But when you say market data, are you speaking to the spot market? Are we talking about government contracting data? Are we talking about operational costs and operationally data? So there’s a few hats that I wear. And so I really try to look at my CEO dashboard once a day, if possible, and then trending overall like market analysis data. I’m constantly doing that with my peers in Twitter, on LinkedIn, at conferences, in this setting. But physically actually looking at the spot market, looking at freight waves and pulling down that data, I would definitely say that’s about once a week for sure. Because we also have to answer these RPs. And so we need to be aware of what spot market costs are right now, what our fuel costs right now. And then some of our projects are dependent upon the region, that we’re in. And so those prices fluctuate.

Brent – 00:14:30:

All right, Freight Nation, I hope you paid attention to what Melanie just said. She just gave some valuable information. She said it’s not just looking at data that’s important. It’s looking at specific data, whether you’re talking about different segments of the marketplace or different parts of freight that are moving. Government freight is obviously very different than open market freight. Looking at what’s going on from a forecasting standpoint, what’s looking at business data from the standpoint of just business structure itself and how business modeling is changing. So she didn’t talk about just data in general. She was real specific about things. And I love that, Melanie, how you talked about the importance of knowing your numbers, where you went all the way down from knowing your numbers to fuel efficiency to understanding the efficiency of the truck and then the drivers going across the country for you. So let me ask you, how big is your operation that you run?

Melanie – 00:15:16:

So right now we are running 22 units, but we have partners that we align ourselves with to handle these large projects that are under the government umbrella. This is one thing that I appreciate about this customer. They’re really keen on partnerships and subcontracting and joint ventureships, which looks very different on the private market side of things. And so there’s a lot of different added values that you can bring to this customer. So storage, warehousing, packaging, crating. And so it’s not just about those trucks that are running up the road.

Brent – 00:15:50:

Oh, there’s revenue in all segments. Yeah. I’ve got a friend of mine out of Texas that pivoted into the dry goods movement because of the amount that they can get on expedited hotshot hauls. And more than half of her business now is in that segment because she found a very profitable segment that could do returns, which gets me to your point about doing business with the government. So you talked about your structure. You’ve gone from Stillman University. And Tuscaloosa, Alabama, where I live, I’ve lived the last 27 years, to health care, to logistics, and realizing kind of grabbing a hold of what’s something that you could lead, which is super exciting. And so you’ve moved your business all the way through. And you started finding that government contracting is something that you’re actually really good at. So tell me about how you discovered that. And then what are the advice you would give others about considering to get into it?

Melanie – 00:16:38:

Well, let’s pull it back a little bit. I don’t know about being really good. I’m still a practitioner of the craft. I’ve done well so far, but that’s because I execute, right? Circling back around to that execution. And that’s what it really looks like for government contracting. You asked, what advice would I have for someone looking to get started? Really understanding what services you offer. There’s truly riches in the niches. There are a vast array of different forms of transportation.

Brent – 00:17:09:

Riches in the niches.

Melanie – 00:17:10:

Riches in the niches. And so I know that most of us, we get comfortable with talking about ground transportation. That’s really what we highlight on most of these platforms. But this particular customer gives opportunities to where now in Integrity Global Logistics, we can offer charter freight and air freight. There’s different opportunities where you can haul rail freight and things of that nature. And so we have to think beyond just what we see in front of us. Is it a hard customer to establish a relationship? Absolutely. Right? Listen to the word. Government contract. That is a heavy true, right? But I will tell you this. Once you set your foundation and once you start to build a portfolio and a relationship with the government, this is a long lasting customer. That is recession truth. That does not fluctuate according to the market temperature. We did our best during COVID, of course. And that’s because of government contracting, not because of the spot market, right? Why are we still able to sustain and thrive right now in business? We’ve just landed an eight figure contract. That’s not from the spot market. Now, I will say this. Some of our private customers we do well with, right? We haul pharmaceuticals as well. So let me not paint the picture like the government is your only customer. I want to be clear about that. The government is not your sole customer, right? But I’m going to tell you this. It is a damn good customer to have on your portfolio. And especially if you want to build, grow and scale any form of small business, they will help you to get there. Why? They understand that operational cost, right? They understand fringe wages and benefits. They understand what it is to run an organization versus a spot market where it’s run that truck up and down the road. And it looks a little bit different, right? And so understand what your niche is within the transportation space, right? Is that ground transportation? Is it warehousing, packaging, crating? Are you a logistics provider in a full 3PL where you can offer several different a la carte services for the government, right? Are we hauling pharmaceuticals, temperature sensitive cargo? Are we hauling mail? Are we hauling military artillery vehicles and ammunition and things of that nature, right? So we’re really focusing in on. What it is that you want to add to the government and moving strategically. At Team Integrity Knowledge Center, this is where this foundation came from, right? This organization rather is because, yeah, I got into industry. I became successful and I did it quietly until my girlfriend nudged me and said, excuse me, how are you going to reach this level of somewhat of success and not reach back to the community? And so that’s where the inception of Team Integrity Knowledge Center came from.

Brent – 00:20:14:

You had someone invest in you that got you to Stillman. Is part of your heart towards that was the genesis of that relationship?

Melanie – 00:20:22:

I never thought about that. And now that you bring it to the forefront, I guess I would say that it does have some form of an impact, right? But most importantly, I think for me, why I became a nurse and an ER nurse is because I identify with underserved communities. I identify with troubled youth who are misunderstood. I identify with not having the tools and resources. And we’re not talking at our dinner table about financials and business structuring and hedge fund accounts. That wasn’t my narrative. I’m in my story. And so I think that opened up on something that I can give back to our community that will really help them to have longevity within this industry. Once again, transportation reminds me closely of the medical field, right? We’re both essential. We are the heartbeat of the economy. Without transportation, we just would not be able to sustain. And while it’s still a great market, a great industry to be in, we just need to understand how to strategically move within the industry. Another thing is we need to understand the power of relationships, right?

Brent – 00:21:35:

You’re speaking my language now.

Melanie – 00:21:37:

OK, so let’s talk, Brent. And you’re not going to build that relationship in your first meeting, right? It has to be nurtured. It has to be cultivated. We have to showcase our added value, our core competencies and how our partnership will, once again, build growth. And so right now, I think it’s keen that we build trust. And most importantly, we build relationships with Integrity.

Brent – 00:22:02:

Without a doubt. And relationships, business isn’t any fun if you don’t create beneficial relationships out of it. I’m a whole supporter in that thing. So, wow, what great information about how to do business with the government. I love how you talk about bring what you specifically can do and then ask the questions about what you can grow into and continue to iterate your business on serving that government entity as a customer. But also remember, they’re people too, and then relationships need to get built. And as you scale out, and I love your heart in this, Melanie, about why you have your innovation, your Integrity knowledge center, because it’s about giving back to those and helping grow and really adding positively back to something that’s given a lot to you. I feel the same way about what’s going on. So much has been in my life has been such a reward to me. I want to help others have that same opportunity. Take this away from this conversation, Melanie. No matter where you start, just start somewhere and build success one day at a time. Get the education that you need or the credentials or the experience that you need to move into something and don’t be afraid of taking risks. Because here’s what I know about Melanie in these few minutes we’ve been together. She likes to take risks, but she knows she can control the outcome. And that’s a powerful thing to know about yourself. Melanie, that’s fantastic advice. And look, I also want to point out one other thing that you and I have in common. We’re both speaking at the Broker Carrier Summit in Fort Worth in just a couple of weeks.

Melanie – 00:23:28:

Yes.

Brent – 00:23:29:

So come out to the Broker-Carrier Summit in Fort Worth. I think this is starting the 23rd or 24th? 23rd. That’s right. In Fort Worth. Looking forward. And if you want to hear more from Melanie, you can always go find her on LinkedIn. You can come out to the Broker-Carrier Summit. I’m sure you can find her. She’s not hard to find. It’s one of my favorite things about Dion Sanders. He always says, I ain’t hard to find. She’s not hard to find. And she’s always got a great heart to help. Melanie, thank you so much for being on Freight Nation today. You have been just a joy, as we started with, to be a part of. And I love your hope and your encouragement for others and your desire to give back. So thank you so much for being on Freight Nation today.

Melanie – 00:24:03:

Absolutely, Brent. Thank you for having me. Look forward to coming back.

Brent – 00:24:06:

Well, you will. Absolutely. I love to hear. I want you to continue to tell the story and continue to help people. Well, Freight Nation, that’s a wrap. As we like to say at Freight Nation, don’t forget to work hard, to be kind, and to stay humble. All right, Freight Nation, we’ll catch you the next time.

Outro – 00:24:22:

On behalf of the Truckstop team, thanks for listening to this episode of Freight Nation. To find out more about the show, head to truckstop.com/podcast. If you enjoyed this episode, make sure you hit subscribe so you don’t miss any future episodes. Until then, keep on trucking and exploring the open roads with Freight Nation: A Trucking Podcast.