Volume 4  Issue 1 April 21, 2008

Cold Business, Cool Enterprise

Richmond Cold Storage has built a thriving enterprise in refrigerated warehouses by combining old-fashion values with a commitment to state-of-the-art technology and best management practices.

By James A. Bacon

Frank E. "Pepper" Laughon, Jr., the snow-haired CEO of Richmond Cold Storage, refuses to divulge his age but concedes that he's "as old as dirt." He grew up in a different era than today's fast-paced knowledge economy, that's for sure. In the early 1950s, his father's cold storage and ice business still had hand-push carts and horse-drawn wagons. For summer jobs, he worked 17-hours a day, seven days a week, delivering 300-pound blocks of ice -- at least that's how he remembers it. His father thought the grueling physical labor was perfectly appropriate for his son.

Laughon's values hearken from the past as well. He still believes in the old-fashioned virtues of honor and integrity, which he makes every effort to instill in his workforce. Lying to management or a customer, he says, is a firing offense. Lie, he says, "And you go up in a puff of smoke."

Laughon talks of treating employees like members of an extended family -- some have worked for him for decades. He worries about the company's reputation, not its "brand." He builds business by cultivating long-term partnerships, not chasing the latest deal. In short, his priorities are the antithesis of those found on Wall Street. "We're not driven by quarterly reports," he says. "We're not seeing how big we can get. We're looking to see how good we can be. We thrive on excellence."

of energy-conservation technologies and practices. It is also an industry leader in implementing information technologies and scanning equipment to manage inventory.

"For a traditional industry -- the food warehousing industry -- Pepper has been a visionary," says J. William Hudson, CEO of the International Association of Refrigerated Warehouses. "He understood the role of his company not only in this country but globally. ... As chairman of this international association [several years ago], he had the attention and respect of industry leaders from around the world." More.

RIC Moves to Head of Class

Strong enplanement growth and sound finances helped the Capital Region Airport Commission win an A- rating on its latest bond offering.

Fitch Ratings, of Chicago, has assigned an 'A-' rating to nearly $51 million in Capital Region Airport Commission bonds, series 2008a, scheduled for sale in March. The bonds, secured by revenues from the operation of Richmond International Airport, will finance construction a new structured public parking facility expansion.

The 'A-' rating reflects the airport's strong service area in the state's capital and resultant solid passenger market with a high origination and destination (O&D) traffic base, good air carrier diversity, consistently sound financial operations, and a modest capital improvement program through 2012. Enplanement growth at the airport has been supported by underlying demographic and economic strengths as well as the recent service initiation by low-cost carries, including AirTran Airways (in June 2005), JetBlue Airways (in March 2006), and SkyBus Airlines (in May 2007). More. 

In other RIC news...

Airport Assigned A2 Bond Rating. Moody’s has assigned the commission an A2 rating. Stated Moody’s: “Enplanement growth has generated strong operating revenues in recent years, adding to the commission's financial strength. The commission has achieved double digit growth in net income for each of the past three years. Debt service coverage for the airport's revenue bonds has climbed to 2.47x in FY2007 from 1.85x in 2003.” More.

RIC Traffic up 10 Percent. Passenger traffic at Richmond International Airport set a record in 2007: 3.63 million travelers, an increase of 10 percent over 2006. Since the arrival of AirTran Airways, JetBlue Airways, and Skybus Airlines, passenger traffic has increased a total of 46 percent in three years. More.  

People

Moynihan to Retire. Martin J. Moynihan, executive director of the port of Richmond since 1990, will retire in July. During his 18-year tenure, he modernized the port facilities, he was a key player in transforming the Port of Richmond from a “niche port” on the James River to “Central Virginia’s Mid-Atlantic Multi-Modal Freight Gateway.” More.

Port Commits $1.5 MM to Turning Basin.

The Port of Richmond Commission has authorized $1,472,000 for the completion of the Deepwater Terminal Turning Basin Expansion Project. The project will permit the movement of large vessels into and out of the Upper James River, including oil barges and bulk vessels, benefiting the Port of Richmond and private commercial maritime facilities such as DuPont, Kinder Morgan Energy Company and Vulcan Materials Company. More.

Port Traffic Rises. Port of Richmond total tonnage for 2007 increased 4 percent to 464,279 st. Strong performance by ICL, up 11 percent in container traffic, and the addition of Eimskip Shipping Line, accounted for the gains. More.

ICL Deploys New Ship. Independent Container Line, anchor tenant at the Port of Richmond, has deployed a new ship, the MV Independent Accord, with a 1,432 TEU capacity and a speed of 20 knots. More.

Terror Certified. The Federal Marine Terminals have been certified by the Customs-Trade Partnership Against Terrorism, a program that enhances security processes throughout the global supply chain. More.

UPS Freight Guarantees On-time Deliveries. UPS Freight, the nation’s fourth largest less-than-truckload carrier, will back its on-time performance reliability with the same type of service guarantee that long has been enjoyed by UPS's small package customers. Under the guarantee offered by the former Overnite Transportation, a customer can request the waiver of his freight charges if his shipment doesn't arrive on time. More.

O&M Profits Up Again. Owens & Minor has reported revenue of $1.75 billion for the fourth quarter or 2007, a 6 percent increase from the same period last year. CEO Craig Smith said he expects the hospital supply-chain management company to continue outperforming the industry. “We believe we will achieve 2008 revenue growth in the 5 percent to 7 percent range, outpacing overall industry growth rates." More.

Spec Ops Nabs Navy Contract.   Spec Ops, Inc. has been awarded a $1,834,362 contract (including a $638,604 option) from Naval Facilities Southwest for Modular Command Post Systems (MCPS). The company will deliver 27 modular command posts to Port Hueneme, Calif., over a two-year period. More.

Jugnheinrich Rolls out “Green” Forklift. Jungheinrich has introduced the EFG 425-430 four-wheel, counterbalanced lift truck, a “green” alternative to internal combustion forklifts. The electric whisper-quiet, emission- free truck has a 5,000 to 6,000-pound capacity. More.

Richmond Logistics Firms to Tap Export Markets.  The Virginia Economic Development Partnership has accepted two Richmond-area companies, Getloaded.com International and Spec Ops, Inc., into its two-year Virginia Leaders in Export Trade (VALET) program. The program assists Virginia companies with firmly established domestic operations that are committed to international exporting as an expansion strategy. More.  

DSCR Signs MOA. Defense Supply Center Richmond has signed a memorandum of agreement with the Army’s Prototype Integration Facility in Huntsville, Ala., that enables Defense Logistics Agency to procure badly needed parts more quickly. Said Ralph Newlon, chief of value engineering for the Aviation Engineering Directorate: “The MOA ... allows us to pay them for reverse engineering and other technical projects so we can get parts for our aviation customers.”