Valley Cartage Crosses The River
Todd Gilbert walked into the building and thought to himself: This is perfect.
Well, almost perfect.
Gilbert is the third-generation president of Valley Cartage, a trucking company founded in Hudson, Wis., by his grandfather, Norman Gilbert, in 1935. In 2012, Todd Gilbert was looking for new space to accommodate his firm’s expansion, and the Lake Elmo building facing Interstate 94 had the space and amenities he was looking for.
Just one thing: It was located in Lake Elmo. In Minnesota.
“It was a huge jump for us to cross the river,” says Steve McFarland, the company’s vice president of sales and marketing. After all, Valley Cartage had operated in Hudson since its founding. Under Todd Gilbert, the company has grown fast thanks to acquisitions and new services. And it was growing, fast.
But there was no guarantee that all of its employees would be willing to make the move with the company. Then there was the fact that Minnesota taxes were higher than Wisconsin’s. The building might be right, but did the move make sense for this family-owned company?
The company had built its reputation on service, no matter how big or small the haul. “One of the first things Grandpa ever said to me,” Todd Gilbert recalls, “was, ‘This business is simple: They call, you pick it up, you deliver it. You do those things, you’ll continue to outperform your competitors.’ ”
Among the companies that have long benefited from this approach is Bayport-based Andersen Corporation, which uses the truck firm for less-than-truckload (LTL) shipments throughout the Midwest and in parts of Canada.
“What’s hard to find in the LTL business is someone who’s service-oriented,” says Vahan Badalow, Andersen’s director of transportation and logistics strategy. Larger LTL firms, he adds “don’t always honor their commitments.” A promised three-day delivery “can be four days, it can be five days.” Valley is very dedicated to our account. They hit that service time 99 percent.”
However closely Norman Gilbert’s grandson has sought to stick to what he calls “the Gilbert way” of basics and service, Valley Cartage’s business is no longer that simple. Under Todd Gilbert, who joined the company in 1992, Valley Cartage isn’t just a hauling operation. In 2002, Todd Gilbert created a logistics division that partners with about 15 other family-owned trucking companies in the region. The logistics partnerships allow Valley Cartage, as Gilbert puts it, “to always say yes” to customers. If a customer needs a delivery that Valley Cartage can’t handle, the company will still accept the job, shifting it to one of the partners that can.
As the logistics side of the business has expanded, Valley Cartage needed modern new space to operate, one where sales, marketing, and operations could work together. That’s what that Lake Elmo building had. That, and an interstate-facing frontage where Valley Cartage’s name would be prominent.
But there was that little matter of higher taxes, one of the many financial barriers to a move. The city of Lake Elmo was ready to help. “There were so many things that compelled us to stay where we were,” McFarland recalls. What the city did, he adds, was look at the situation “holistically.” Lake Elmo worked with Washington County and state government to find ways to reduce those hurdles. For instance, with all the development the city is contemplating on I-94, property taxes were likely to jump in the coming years.
The city “got very creative on that,” McFarland says. Lake Elmo and Washington County have agreed to share in $40,000 in tax abatements over the next four years, contingent upon Valley Cartage meeting certain job-growth goals.
In addition, McFarland says, “we knew we’d lose employees who wouldn’t want to cross the river.” Valley Cartage also knew that it would create jobs in the new headquarters. Lake Elmo involved the state’s Department of Employment and Economic Security, and DEED offered Valley Cartage a $500,000 forgivable loan for its relocation. The company also can apply for $400,000 in tax credits for job training.
Valley Cartage officially opened its new headquarters for business in July. About 50 of Valley Cartage’s 240 employees now work in Lake Elmo; there’s room to expand to 100. The company also has facilities in Duluth, Mankato, St. Cloud, Fargo, and La Crosse. Even with that growth, Todd Gilbert doesn’t want to lose a family-business feeling and focus on service. It’s the Gilbert way—both in Wisconsin and Minnesota.