(The original article was published on Canadian Business Journal, Issue of October 2009)
Based in Toronto, IPE is an international freight forwarding company that handles ocean, air, and ground shipments. Jeff Hao, General Manager, came on board in January 2005, which was an important period in the company’s development. “The first three years is a critical time in any business,” he says. “It’s a period where you not only have to survive, but you have to grow.” Fortunately, IPE managed to do both of those things.
Although the company started with only three employees, it soon grew enough to necessitate a new office. In fact, IPE moved four times in the first four years, just to accommodate new hires. Today, the company has 16 fulltime employees and has been in its current location since 2006. However, just because the headquarters hasn’t moved in a few years doesn’t mean the growth has died down. On the contrary, IPE opened two national branch offices in 2007—one in Montreal and the other in Vancouver.
In addition to employee growth, IPE also continues to collect new clients. And client collection is an appropriate concept for IPE Logistics, as the company has never lost a major customer. “Many of our key clients have been here since the beginning,” Hao says. “They have grown together with us. Some of them used to be small companies and have since expanded into medium-sized businesses. On top of maintaining good relations with existing clients, IPE also focuses on bringing in new business every year.”
To illustrate how successful the company is, Hao explains that IPE has grown 640 per cent in five years (from 2003 to 2008). “Even last year, which was rough for the freight forwarding industry, our revenue grew 30 per cent,” he says. “This year, our revenue is stable, and we have been in the fortunate position to hire new employees.”
“We don’t worry about the big economic situation,” Hao adds. “Of course, it affects us because our clients’ order sizes are shrinking. But our client base is growing. Even if individual orders are decreasing, we can still cover our targets by increasing the number of clients.”
Recent growth in the logistics industry is remarkable; global trade was hit especially hard over the last year. Even PROFIT magazine took notice of IPE’s success, ranking the company #126 on the list of fastest growing companies in Canada.
An advantage in size
After summarizing the company’s achievements, Hao reckons the secret to success lies in its size. “There are advantages to being a smaller company,” he maintains. “Smaller companies are often more sensible and personalized. As we grow, we make it a priority to keep the level of service that we started with. We remain faithful to our clients. Service means getting on the phone, answering emails and doing our best to make the logistics process easier for businesses. We want to make others feel like they are dealing with real people.”
IPE also continues to specialize in freight forwarding services, as opposed to the larger logistics companies. “Global companies have their own market and strategies,” says Hao, “but they’re not often strictly freight forwarders. They start warehouses and buy truck companies. They expand. For IPE, we started as a freight forwarder and we’re still doing that. We’re focused on providing services, which is most important to us. It’s our business.”
A culture of ownership and flexibility
Small companies are ones in which everyone’s effort is essential; you can’t hide in a workplace of just over a dozen people. That’s why IPE has worked to build a company culture of family, because it produces a team mentality and individual accountability. “Everyone here takes ownership of getting things done and making the customer happy,” Hao says. “That’s a key competency of ours.”
Company culture is something the management team at IPE believes is important. “When we’re hiring, we look for people who will fit into the environment we work to maintain,” explains Hao. “IPE wants to bring in employees that complement our mentality, which is proactive, service-oriented, accountable, sensitive and flexible.”
Flexibility is imperative, particularly in an expanding business. The company needs people who are willing to roll with the punches and wait out the growing pains. “We don’t require someone to have perfect industry knowledge,” Hao continues. “We want someone who is willing to contribute and change with the company. As a small company, we can’t afford to stay the same all the time. We have to be able to observe and evolve.” Another thing they keep in mind when building their team is leadership. Rapid growth often means quick promotions, so IPE needs people who are comfortable in management roles.
Hao believes the company has been able to hold onto its values; he is optimistic that the company will continue to priorities the importance of a cohesive and like-minded team.
IPE Logistics may have a simple business model, but it is certainly working for them. Hao says the company will continue on the same path, until it doesn’t work anymore. “If we have a good strategy, we can keep growing,” he reasons. “And we have a good strategy.”
Right now, IPE’s strategy is to prepare for when the economy bounces back. While the economy has suffered in the past year, the company has taken the opportunity to invest in a new computer software system for higher efficiency and more accurate data. When the economy turns around—and it is, slowly—IPE will be prepared.
Hao hopes the new infrastructure will help the company target bigger players. “We’re starting to go after clients from medium and large companies,” he concludes. “We want to explore more markets, both domestically and internationally. I think after the market recovers, IPE Logistics will be ready to do business on that level.”
The original article was published on Canadian Business Journal, Issue of October 2009.
To read the E-Version of this article, please go to the following links:
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http://www.canadianbusinessjournal.ca/business_in_action/oct_09/ipe_logistics_inc.html ( A Plain HTML Version without Pictures)
IPE Logistics (Canada) Inc.
October 15th, 2009