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OPERATIONS

Meals on Wheels (and Rails and Water)

Paul Robbins looked at a run-down Florida neighborhood and beheld a transportation utopia. The story of this year's #1 Inner City 100 company.
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Paul Robbins looked at a run-down Florida neighborhood and beheld a transportation utopia

Caribbean Shipping & Cold Storage thrums with activity. Outside the warehouse, 18-wheeler trucks rumble to and from the loading dock in perpetual unchoreographed motion. Inside, beeping forklifts heft pallets stacked high with boxes of Dunkin' Donuts soups, Best's Kosher beef Polish sausages, and other comestibles making a Jacksonville, Fla., pit stop on their way to restaurants in South America and the Caribbean islands.

Five years ago the scene looked very different. Like proud home remodelers co-CEOs Paul and Julie Robbins spread out photographs showing their company's site prior to its $1-million face-lift. They depict an abandoned warehouse surrounded by ramshackle houses and a lot strewn with rubble from a roofing company that burned to the ground. Invisible to the camera's eye is the nearby matrix of rail lines and highways that has helped propel Caribbean Shipping to the #1 spot on Inc.'s list of the 100 fastest-growing inner-city companies. Sales rose from $3.5 million in 1994, the year before the company moved to its present location, to $20 million in 1998.

Paul Robbins, a compact, energetic man of 47, likes to compare his business to a travel agency. "If I'm going on a trip, I could call the airlines and a car-rental agency and a hotel," he says. "But I'd rather make one call to a travel agent to set everything up." In Caribbean Shipping's case, the travelers are food products that require cold storage on their way to fast-food restaurants, grocery stores, and hotels in Puerto Rico and other islands in the Caribbean. A shipment of seafood migrating southeast from Seattle might be handed off between trucks, trains, and ships as many as six times, explains Robbins. Instead of making arrangements with all those carriers, customers such as Outback Steakhouse and the Ritz-Carlton hire Caribbean Shipping to navigate the paperwork, supply the trucks, and even expedite U.S. Department of Agriculture inspections. At each step Caribbean Shipping makes a bit of profit for itself.

The company's logistical proficiency is a product of its location. Caribbean Shipping is one block from Interstate 95, a north-south route that half a mile down the road crosses Interstate 10, which runs east and west. A CSX Transportation railroad line is so close that train whistles regularly punctuate staff meetings. One of Jacksonville's marine terminals is 5 miles away, another 17 miles. Robbins considered building Caribbean Shipping's warehouse near a terminal, but tax credits, grants, and cheap land lured him to the inner city. "We got three times more building size here than we would have had near a terminal, with the same capital investment," he says.

Those financial incentives outweighed the neighborhood's dicey reputation. When Caribbean Shipping moved there, late in 1995, police regularly patrolled the area for drugs, and the company's general manager had a shotgun shoved in his face by a man who stole his money and his car. In 1996 and 1997 the company spent $110,000 a year on round-the-clock security. But as Caribbean Shipping and its neighbors stepped up their activity, safety improved.


"We got three times more building size here than we would have had near a marine terminal, with the same capital investment," says Paul Robbins.


Florida is many miles away from -- and many degrees warmer than -- Paul Robbins's home state of Maine, where the entrepreneur labored as a structural ironworker. After being transferred to Jacksonville, in 1979, he left construction to work in a warehouse for King Provision Corp., which distributes everything from napkins to ground beef for Burger King restaurants.

After three years Robbins was promoted to vice-president of operations and found himself traveling frequently to Puerto Rico, where he observed Pizza Hut, Wendy's, and other franchises springing up on the streets of San Juan. The economics of shipping intrigued him. Burger King had enough Puerto Rican outlets to require cargo containers crammed with supplies, Robbins knew, but the less plentiful chains did not. They consequently required a middleman to ensure they didn't lose money by shipping half-full containers.

Inspired, Robbins created for his employer a new division called King Export that filled containers by corralling small loads from several customers. The consolidation part of the service wasn't unique, but King was one of only a few companies that also offered cold storage, which keeps perishables from perishing during lulls between transport legs.

By 1993, however, building things for other people was losing its luster. When his offer to buy King Export was rebuffed, Robbins launched his own company, using contacts he'd made while at King Export. He persuaded a coworker, Julie Robertson, to join him. The two later married.

At first the couple worked out of a cramped 120-square-foot office in a retail-dense neighborhood and subcontracted everything out. In 1994 they decided to bring Caribbean Shipping's nuts and bolts in-house, prompting a move to a location with a leased cold-storage facility. There they started a trucking division with two vehicles. However, even that space soon became inadequate. City and state tax incentives that were offered to companies that moved to an old industrial section of Jacksonville's downtown were enough to lure the Robbinses to their current location.

The core of Jacksonville's inner city is a state-designated Enterprise Zone. For Caribbean Shipping, doing business there has translated into savings of $14,460 in property taxes and $17,900 in electricity sales taxes since 1997. The company also received a state grant of $37,380 for hiring and training 43 workers, and it gets state tax credits for employing residents of the inner-city zone. (Caribbean Shipping currently employs 18 residents of the area.) The company's biggest obstacle to growth is finding skilled employees, who are tough to come by in an excruciatingly tight labor market, says Robbins. He plans to add 40 or 50 new hires to a staff of 125.

Growth has been Caribbean Shipping's watchword, and Paul Robbins says he is just getting revved up. This year he will convert two small city blocks across the street from the warehouse into 3 million cubic feet of cold-storage space, more than three times his current capacity. The addition will mean new office space as well, a prospect embraced by employees who sit at desks separated by just a whisper of space as they track freight across continents using computers, telephones, and radios.

To fund the expansion Robbins went back to the city, which was happy to oblige. "Paul Robbins knows his market and has a great customer base that continues to use him and recruit new customers," says Joe Whitaker, a senior project manager at the Jacksonville Economic Development Commission.

The Robbinses' current plan calls not only for buttressing the company's Jacksonville base but also for reaching new markets. Caribbean Shipping is penetrating deeper into South America, and the CEOs are hungrily eyeing the Dominican Republic as well. That country has a large population of teenagers and "only three Taco Bells," says Paul Robbins, explaining why he expects a massive onslaught of fast-food joints. "If you are going to have the same chalupa in the Dominican Republic as in Jacksonville, the meat is going to come from the United States," he says. Caribbean Shipping, he hopes, will be charged with getting it there.

Jane Tanner is a freelance writer based in Atlantic Beach, Fla.

For a detailed list of Inner City 100 companies, please see The Inner City 100: America's Urban Superstars.


Please e-mail your comments to editors@inc.com.

Last updated: May 1, 2000




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