Target Interstate Systems finds harmony working with customers
Produce logistics company Target Interstate Systems has been part of the Hunts Point Terminal Market since 1981 and understands what it takes to form strong relationships with major shippers and receivers in the produce industry.
“What makes Hunts Point so special is the unique dynamics of the largest wholesale market in the world of fresh fruit and produce,” said Paul Kazan, president of Target Interstate Systems. “The diverse demographics and ethnicities of New York City is reflected in the vast array of fresh fruit and produce offered by the market unlike anywhere else.”
For its customers in Hunts Point, Target Interstate Systems provides logistic support and service for a vast array of produce, procured from all the various growing regions in the country as well as imports.
“Hunts Point is also different in the pricing of those services,” Kazan said. “Unlike the committed volume and or price contracts that exist with the supermarkets and institutional wholesalers, transportation is viewed as another commodity and is subject to the same forces of supply and demand as the underlying produce we haul.”
Unfortunately, business has been flat for the company over the past year due to the pandemic.
“Though the Hunts Point market has been steady for us, our foodservice division has suffered significantly due to the COVID-19 pandemic,” Kazan said. “In addition, there is a considerable lack of carrier capacity in most regions we serve. For example, the enormous backlog of container freight on ships coming into the West Coast ports is creating an urgency to move that freight by truck and not rail.”
Additionally, he explained, there is a considerable imbalance of “dry” freight available which is pushing the freight rates on produce to record highs for this time of year. Therefore, the company’s focus is to increase its carrier capacity by aggressive onboarding of new carriers to help serve its customers.
“The dynamics with our customers fall into two categories,” Kazan said. “One is a transactional relationship where you are just another commodity to procure. This is where you as a vendor have loads offered by the customer whose decision is price driven. Each load is unto itself and is primarily based on the lowest bidder for the freight.”
The other is a partnership relationship, in which the company has an ongoing working relationship based on service and trust.
“Here the customer tenders you the freight as their logistics partner and knows you will always charge the right or fair price,” Kazan said. “They recognize that we are truly collaborative partners understanding their specific business needs to help support and grow their bottom line. This is where we find true harmony in working with our customers.”
A challenge that Target finds in 2021 is the younger generations coming in working in a completely different way than most long-time companies have been used to. For example, Kazan noted that millennials thrive in the digital environment and more and more business is being done that way.
“Business is now primarily conducted through texts and emails,” he said. “Often these involve a burst to a large number of vendors looking for a quote. For us, this is the same on the carrier side. We also send out burst requests for trucks and trucks do the same looking for loads with a published price.”
Additionally, a lot of the transactions are now done on a third-party website where you can post and book trucks. All this takes out the personal and partner relationship approach that Target enjoys most.
Although he’s been very happy operating at Hunts Point, from a transportation perspective, Kazan would like to see greater improvements in the market infrastructure to include some services for the truckers.
“I think that trying to create an orderly appointment system for unloading trucks would be helpful in the future,” he said. “Companies throughout the country are finding themselves rated on the internet for timely loading and unloading which could affect the rates. There are some simple programs out there to help customers to do this with no additional labor.”