Dunham Express Sets the Standard, One Delivery at a Time

A large part of success is knowing what you want. When Mark Helmke and Mark McDonald took the plunge and bought Dunham Express in 1997, they had found exactly what they were looking for - a small courier company in the Midwest with incredible growth potential and a reputation for customer satisfaction that was second to none.

"When we joined the company it had a wonderful mom-and-pop culture and loyal customer base," said McDonald, now CEO of the company. "Yet it was experiencing severe financial and operational challenges. Our timing was perfect. They needed the technical assistance and fiscal leadership we could provide, and we needed what they already had in place - a solid foundation of well-established customers and routes, and an enthusiastic passion to serve their customers."

The rest is history, as they say. Headquartered on Madison's East Side, Dunham Express now has seven locations in Wisconsin and three in Minnesota; from these distribution centers it also delivers to Illinois, Iowa, and the Upper Peninsula of Michigan. Under the leadership of McDonald and chief marketing officer Helmke, sales have grown an average of 12% per year, from about $10 million in 1997 to more than $25 million in 2005.

Helmke and McDonald brought a combined 40 years of experience in the courier business to Dunham Express. Initially they struck up a friendship in the late 1980s, when they were both working tor Minneapolis-based Courier Dispatch Group, each moving up the corporate ladder in various management roles in the Midwest and Texas.

They'd already been through several reorganizations "when we heard there was a big merger coming along," said Helmke. "That's when we started talking about being independent and doing something on our own."

"The idea of staying on after another restructuring, with less job security and less control, wasn't very appealing," added McDonald. "We wanted to stay in the Midwest. So we wondered: Do we find a little storefront and start driving a couple of trucks? Or do we find a company to invest in?"

As they began to research Dunham Express, they were impressed by its reputation and rapid expansion across Wisconsin. Launched in 1951 as Dunham Mail Delivery by Arthur Dunham, sales had reached about $8 million by 1995, with the opening of new offices in Eau Claire, Wausau, Niagara, Milwaukee, and Appleton.

After McDonald and Helmke finished their due diligence, they felt that Dunham Express's liabilities outweighed its assets on paper. But that didn't discourage their interest, because Dunham's greatest assets were its passionate commitment to customer service and outstanding reputation.

"It was all there," said Helmke. "The company just needed a strong business plan, more experienced leadership, and improved infrastructure, including technology upgrades."

Taking on the competition

The delivery business is highly competitive - from individuals with a couple of trucks to billion-dollar companies like FedEx, UPS, and the U.S. Postal Service. So how did Helmke and McDonald almost triple Dunham Express's revenues in less than ten years? By expanding market share through innovative, highly specialized customer service - the backbone of its reputation.

Dunham Express provides a variety of services, including daily courier routes between larger cities, mail delivery, and inexpensive overnight interoffice services. This specialized service saves companies with multiple branches thousands of dollars in overnight delivery charges and generally gets the work delivered much earlier in the morning.

But Dunham's most valued (and envied) service is its 24/7, on-call delivery. "A customer can call anytime, day or night, and a short time later a Dunham Express truck will be at the door, picking up the package and getting it on its way," said Helmke. This gets the art of "just-in-time" delivery down to a matter of hours, which is a huge advantage over companies like UPS and FedEx.

"Because of our smaller size and flexibility, we do things that the bigger companies simply don't want to do, or can't do" said Helmke. "For example, one of our clients is in Chicago. Our trucks are on their loading dock at 3:00 a.m. and those goods are being delivered in Wisconsin by 7:00 a.m."

Customer service matters

Another big difference between Dunham Express and other delivery companies is the personalized service.

"If you have a problem on a delivery with one of the national carriers, say your overnight package didn't show up when it was supposed to, the big companies will refund the amount you paid and basically say they're sorry," said McDonald.

"On the other hand, if in that rare instance some- 'thing happens with one of our deliveries, we'll enlist another driver and get right on it to make sure it is delivered as soon as humanly possible. When that happens, we lose money big-time, but that is how we run our business."

Dunham Express customers have come to rely on the company to find creative solutions to their shipping problems.

"We tackle the problem first, find the answer, then work out a fair price afterward," said McDonald.

McKesson HBOC is a multibillion pharmaceutical firm that has a distribution center in La Crosse. When the courier company it had been working with suddenly went bankrupt, "McKesson called us on a Friday morning with a big delivery that needed to go out Sunday night," said McDonald.

"We came up with a plan, found the vehicles and drivers, and were there on Sunday with three trucks waiting at their loading dock."

"It was pretty impressive," said Scott Mooney, McKesson distribution center manager (in an article that appeared in Courier magazine). "Actually, it was incredibly impressive. But that's the kind of service you get from Dunham."

OfficeMax (formally Boise Cascade Office Products) in Milwaukee is another Dunham Express devotee. Dunham had just gotten its first contract with Boise Cascade - a small portion of their business in the Upper Peninsula of Michigan - when the company called with the news its long-time delivery partner in Milwaukee had just gone out of business.

"The courier company had ceased operations, the trucks were gone, the whole works," said McDonald. "Boise Cascade had a huge backlog of freight. That night we picked up the freight from their distribution center and did over 1,000 deliveries the following day. In fact, I drove the line-haul truck from 6:00 a.m. to 7:00 p.m. every day for a week."

"Saying 'yes' and worrying about the details later is still a big part of our culture," said Helmke.

Boosting technology

A key part of the McDonald-Helmke vision was to upgrade Dunham Express's technological capabilities. "We knew it was absolutely critical for expanding our market share," said Helmke.

In 2000 Dunham Express was the first same-day courier company in the region to develop scanning technology.

"We invested about $750,000 to develop a very customized scanning system," said McDonald. "Nobody at that time in our industry had an advanced software/hardware scanning system like ours."

Customers expect the very best when it comes to tracking deliveries, which means having the technological capability to provide online tracking.

"Customers need complete visibility of the entire delivery process," said Helmke.

"Our eTrac system is one of the best delivery software systems available for entering online orders, tracking delivery, proving delivery, and billing effectively."

McDonald tells the story of a customer who left Dunham Express for another delivery company that promised a lower rate.

"They told me it wasn't because of our service, but that the new guys could give them a rock-bottom low rate," said McDonald. "It all came down to rate and I couldn't talk them out of it. Seven months later they were back - the rock-bottom company didn't have our service or our technology."

Future plans

Dunham Express has reached that critical size where it's much harder to personally reinforce the "mom-and-pop customer service" mantra daily to over 500 associates, which includes both Dunham employees and independent contractors.

"That's one of the big challenges to our success," said McDonald. "It's harder to communicate the culture. We have more people. More geography. More customers. More activity. When we first came on board all the drivers knew who we were - it's not that way anymore."

As busy as they are, both Helmke and McDonald still make it a point to visit every location, where they hand out gifts of appreciation and help load trucks. "We want to show our associates that we really appreciate what they do, and that we aren't typical corporate CEOs - we're just guys," said Helmke.

"It gets harder to lead and motivate a growing workforce," said McDonald. "We can't do it by ourselves anymore."

Which is why they're both very involved in the hiring process, finding the best possible people who share their values and want to build the same kind of passionate workforce.

To reinforce the idea of how each person, and each delivery, impacts the company's reputation for service, Dunham Express has come out with a new slogan, "Setting the standard, one delivery at a time."

Dunham Express will also cultivate working relationships with select competitors, especially in border states.

"They may be better at some things than we are," admits Helmke. "But to enter into a strategic partnership with us, they must share the same values and have the highest degree of integrity."

Plans also call for more geographic expansion. "We want to be a five-state regional player," said McDonald. Dunham Express also wants to start shipping larger products, such as pallet loads.

"But above all," emphasizes Helmke, "we want to continue to meet all our customers' needs and provide an unparalleled level of personalized service. If we can anticipate solutions for our customers before they even realize they need them, then everything else should take care of itself."