Web-fulfillment sector driving growth for OnTrac
The advantage that the Reno-Sparks area provides to distribution companies — trucks from Reno can reach much of the West in a one-day drive — is repeated so often that it begins to become part of the background noise.
But to executives at OnTrac, Reno’s central location is more than a bullet-point item on a brochure. It’s a critical factor driving the growth of northern Nevada operations for the company, which provides regional overnight package delivery service throughout the West.
“This is the Mecca for us,” says Christopher Reed, a corporate account manager for OnTrac’s operations in northern Nevada.
Competing against UPS and FedEx Ground, one of OnTrac’s competitive advantages is its ability to provide one-day delivery to consumers in the West for e-commerce clients headquartered in Reno.
“We want to provide overnight service when they are proving two-day service,” Reed says about his company’s competition with the giants of the small-parcel delivery business.
Headquartered at Chandler, Ariz., OnTrac serves Nevada, California, Arizona, Oregon, Washington, Utah, Colorado and Idaho.
The Reno-Sparks area is pretty close to the center of that market.
Each afternoon and early evening, thousands of small packages arrive at OnTrac’s 150,000-square-foot facility on Vista Boulevard, just north of Interstate 80.
They’re sorted and back onto trucks within a couple of hours to begin overnight runs for next-day deliveries in Salt Lake City or Orange County or the Pacific Northwest.
The company employs about 120 in northern Nevada.
A growing part of its business, Reed says, is driven by Web fulfillment houses across northern Nevada. OnTrac runs pickups on Sundays from its Sparks center, capturing Internet orders placed during the weekend and getting them into consumers’ hands on Mondays.
OnTrac’s executives do everything they can to stretch the time they have available for one-day delivery.
Trucks headed to the Northwest from Reno, which face the farthest overnight trips of any that leave each night, are the first out the door shortly after 5 p.m. To improve the efficiency of its line-haul system, OnTrac recently reduced its staff of long-haul drivers in Reno by approximately 15, and it’s using an increased number of contracted truckers.
The company starts some of its morning deliveries, meanwhile, at about 9 a.m., providing an extra hour to make sure overnight deliveries have arrived and are ready to go.
Unlike competitors that may handle a package several times at sorting centers after it leaves Reno, packages on OnTrac trucks aren’t handled again until they reach their destination city.
About half of OnTrac’s deliveries, Reed says, are made to residential neighborhoods. Historically, that service has been a headache to parcel-delivery outfits that prefer the dense customer base of shopping centers or office parks. OnTrac, founded in 1991, has ridden the growth in deliveries to residences that accompanied the rise of Internet shopping, Reed says.
The company opened its first hub in Reno-Sparks in 1996.
Even though OnTrac serves a limited geography, it’s now the fifth largest parcel carrier in North America after UPS, FedEx, the U.S. Postal Service and Purolator in Canada.
Given the close relationship between the growth of the Reno-Sparks economy and the growth of OnTrac’s revenues in the market, the company is a major backer of the Economic Development Authority of Western Nevada.
“Reno has really helped put OnTrac on the map, and OnTrac has helped Reno much the same,” says Reed. “OnTrac helps EDAWN attract businesses to the Reno-area that want to distribute more effectively.”
The company also is moving upstream in the supply-chain business, providing fulfillment and distribution services as well as same-day messenger services from its locations.
The cuts would come as a direct result of reduced tax collections caused by business closures across the Silver State due to the COVID-19 pandemic.