A creative business solution guides Knichel Logistics to success

 

Kristy Knichel has led Knichel Logistics as president and CEO for a decade now, but she still feels the pressure of operating a family business acutely.

Kristy and her father William founded the company in 2003. Her brother William Jr. and younger sister Casey are actively involved in management, while another sister and her father remain part owners. As frustrating as it can sometimes be, Knichel says that the ability to navigate the issues that come with operating a business successfully with your siblings drives her to this day — and is a factor in the company’s growth.

“As much as I’ve gone through, a lot of heartache and crazy times — there’s a reason for it,” she says.

Running a family business presents a unique set of challenges that don’t come into play at other companies. The ability to be creative and flexible in that environment and to keep everything moving forward, however, can often put the leader in a better position to deal with the more common issues that come about in leading a business.

A balancing act

After her promotion to leadership and her father stepping down, Kristy has had to strike a balance when it comes to taking her father’s advice, someone whom she views as a mentor and who was responsible for kindling her interest in logistics. Sometimes his input has conflicted with her own ideas and her management style.

“It can be difficult,” Knichel says, “but at the same time, I keep telling myself there’s a greater goal here.” That goal is obviously to make decisions that contribute to the company’s continued success.

She says that this situation is complicated by the fact that the current challenges are different than what Knichel Logistics faced when it was smaller. Her father doesn’t always understand the reasoning behind her decisions, primarily because his own success in the industry occurred under different market conditions.

“It was a challenge for me, talking with him about things I wanted to do. We weren’t on the same page a lot,” Knichel says. “Now, he doesn’t question me as much, what I’m doing.” To put it specifically, her success has built up more trust between father and daughter.

Knichel has been quite open publicly about her family business, including in several published articles and in a speech she presented as a keynote speaker at the 2016 Transportation Intermediaries Association convention.

Keeping up with the competition

Compounding the complications involved with segregating familial dynamics and work is the fact that operating and sustaining a midsize third-party logistics company (3PL) in today’s transportation industry has never been tougher. As a 3PL, Knichel Logistics arranges freight transportation for their customers through their wide array of carrier partners and contracts with the Class I railroads.

The transportation industry is notoriously competitive and expansive, with numerous mergers and acquisitions occurring monthly by enormous corporations, meaning uncertainty for smaller players. As a $50 million provider of transportation and logistics, Knichel Logistics is considered a small fish in this industry.

Unlike other companies its size, Knichel Logistics does more rail/intermodal business than truckload. Intermodal transportation has slimmer margins, however, so the company is currently working to grow its truck business and achieve greater diversity within their portfolio.

But the truck brokerage industry is consolidating as companies buy pieces to ensure they provide services like expedited and freight forwarding, she says. Large truck brokerages also have offices all over the country that better understand regional and local markets.

“It’s been tough for us because the bigger companies are getting bigger and they have more buying power out there with some of these larger trucking companies,” Knichel says.