APPLE VALLEY For a small business, having the power of a large transportation company behind

S O L U T I O N S H O W C A S E

CR E AMERY

GROWS BUSINESS

BY OUTSOURCING

ITS TR ANSPORTATION

you can mean the difference between getting deliveries made on time, or losing customers. From customized vehicles to maintenance to a predictable monthly payment, outsourcing your fleet can be your secret weapon. This report showcases how Apple Valley Creamery gained a more reliable fleet to help its small business grow.

FLEET LEASING & MAINTENANCE | DEDICATED TRANSPORTATION | SUPPLY CHAIN SOLUTIONS

THE OUTSOURCING DIFFER ENCE Since partnering with Ryder, Apple Valley Creamery has:

Improved on-time delivery to 99.9%

Saved more than $10,000 annually in transportation costs

Experienced less than Decreased feet 1% product loss downtime by 66%

Beneftted from trucks designed specifcally Increased customer service levels leading to for them to keep products at optimum business growth of 25% year-over-year

temperatures and freshness

What is Small Business Trucking?

How you transport your products and services is often a secondary consideration in running your business. Understandably, your first priority is to take care of your customers by providing them with the best you and your staff have to offer. To do that right, however, you need to have your vehicles where they need to be, when they need to be there – without exception. Anything else is a risk to business that most small business owners feel they can’t take.

But the importance of your fleet doesn’t end there. The way your company manages its fleet impacts its overall business strategy and success going forward. Your fleet must be dependable. Your company needs to use capital efficiently – with regard to your fleet and the rest of your business. These substantial considerations hold true whether you lease or own your fleet.

The challenges of ownership

Today’s business environment is full of challenges for fleet owners, and it is only getting more complicated. New emissions technology is making trucks more expensive and complex to maintain. Truck prices, along with associated maintenance and repair expenses, have increased by more than 40 percent. The driver and technician shortage is also hampering fleet owners who need to get products to customers.

With the effect your fleet can have on your business, you have to ask yourself whether it’s better to have a full service lease or own your fleet. When deciding which is best for your company, you should take into account: type of operation, truck configuration, managing preferences, routes, capacity, and financing.

Also, ask yourself these questions:

• Do I spend too much time and money managing my fleet?

• Am I up-to-date on the complexities of engine technology, regulations, and emissions standards?

• Can I drive more value from my fleet while gaining time to focus on my business and customers?

Busting the leasing myths

Many small business owners feel owning their vehicles is the only way they can brand their fleet, benefit from tax deductions, and have total control among other things. But these can all be attained through a lease as well. Ryder offers a full suite of lease options so you can select the lease that works best with your business goals in mind.

The truth is, owning, running, and maintaining a fleet can be costly. Unpredictable costs, breakdowns, and unseen risk can take your focus away from your business and your customers. With a full service lease, you get a fleet you can rely on, predictable monthly costs, substitute vehicles available right when you need them, and time to focus on your business.

Through a full service lease, your monthly payment can actually be less than what you are paying by owning your fleet. You also limit your risk should your vehicle breakdown, as all maintenance is covered.

By collaborating with Ryder for a full service lease, you can put the complexities of managing your fleet behind you. With a full service lease you won’t have to worry about acquiring, managing, and disposing of the vehicle. Flexible financing options, vehicle specification, repair, and preventive maintenance are also included.

What you get is a reliable fleet, customized to your business with a predictable monthly payment. These results can be seen in the case of Apple Valley Creamery.

Apple Valley Creamery grows greater

At Apple Valley Creamery in East Berlin, Pennsylvania, providing quality products to their customers is not just about pride. It is their commitment. Apple Valley, which is owned by the Everett and Stoner families, is the only creamery in Pennsylvania that provides both pasteurized and raw milk from 80 pastured grass-fed cows with an Animal Welfare Approved certification. For the fewer than 25 employees at Apple Valley Creamery, providing the freshest products and exemplary customer service are key to this small business earning big returns.

In December 2007, the farm expanded its operation by offering home delivery service. However, expanding brought new challenges – truck ownership.

For this small business, truck ownership brings the tasks of keeping the vehicles properly maintained and having to scramble to find a replacement vehicle should a truck break down. The challenges are magnified in the food and beverage industry, as products must be kept at certain temperatures so customers receive them at peak freshness, the products don’t spoil, and the shipper complies with federal safety regulations.

In Apple Valley Creamery’s case, if one of the trucks they own breaks down, their customers won’t receive products on time, there is a high risk of product loss due to spoilage, and they have to deal with truck downtime and high maintenance costs.

Looking for a solution to their transportation issues, Apple Valley Creamery explored the possibility of outsourcing by leasing one truck from Ryder. The agreement includes Ryder’s maintenance service, assuring reliable vehicles,

and predictable costs. Since leasing its first refrigerated straight truck from Ryder, Apple Valley has leased two more customized trucks. The cab and chassis of trucks two and three are customized by Ryder and unique to Apple Valley, with special cold plate bodies procured from an original equipment manufacturer (OEM) because of Ryder’s ability to leverage relationships in the industry. The body also has the flexibility to change to a new chassis to maximize its life for Apple Valley.

The cold plate bodies keep the milk always delivered at or below 33 degrees. Before, Apple Valley was delivering milk at 41 degrees. With the new trucks getting the product to the customer’s doorstep colder, the quality of the product is at its peak.

Since leasing from Ryder, Apple Valley’s transportation costs have become more predictable. Maintenance costs reduced by more than 75 percent, and continue to be a controlled expense built into their lease with Ryder. In the 12 months before outsourcing to Ryder, unforeseen maintenance costs for the two owned trucks were $10,768.49.

“Although we haven’t had to use it yet, the comfort

in knowing that there is a Ryder location near every

place we deliver is great. In the end, we needed to

fnd a solution and leasing from Ryder was

the best one. ”

– Don Everett, President, Apple Valley Creamery

The fleet’s downtime has also decreased by more than 66 percent. In the year before contacting Ryder, Apple Valley had three truck breakdowns resulting in three days of late deliveries. With predictable costs and a more reliable fleet, Apple Valley has cut transportation costs dramatically and improved its on-time deliveries to 99.9 percent since it began leasing from Ryder.

Apple Valley Creamery has experienced 25 percent growth year-over-year for the past five years. It now serves more than 600 delivery customers including 40 distributors - a client base that continues to grow. This has been possible due to reliable deliveries and an expanded fleet.

For Apple Valley Creamery, leasing their fleet from Ryder rather than owning it allowed them to get the customized vehicles needed, coupled with built in maintenance, and rapid access to specialized rental vehicles whenever needed to keep their business running more efficiently and at a lower predictable cost.

To read the full case study on Apple Valley Creamery and learn of its other results, visit ryder.com.

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