- PNC is proud to support "Business Forward," where community leaders discuss the issues confronting business in Central Illinois.

(air whooshing) (bright hopeful music) - Welcome to "Business Forward."

I'm your host, Matt George.

Joining me tonight, good friend of mine, Jeff Bogdan.

Jeff is the CEO (chuckles) and more, of Federal Companies.

Welcome.

- Great.

Thank you, Matt.

Appreciate it.

- You know, I was thinking, I've known you guys and your business a long time, and I'm gonna get to it a little later in the show, but one thing I wanna start off with is just how philanthropic minded you guys are, and I give you a lot of credit for that.

But I wanna start off with you first.

First of all, are you from Peoria area or middle Illinois, or where are you from?

No, actually was born far South Side of Chicago.

- [Matt] Okay.

- And, then in late '60s, my dad worked in Harvey, Illinois and we moved just outside of Gary, Indiana.

So I actually grew up 10 minutes from the Dunes in Lake Michigan, which we thought we were, no one ever heard of Indiana beach bums, but, that's what we were.

- [Matt] That's what you were.

- Right.

- So, what got you in this business that you're in?

- Yeah, I think, you know, I was in the Navy in Supply Corps for college and one of my fraternity brothers in college, his dad happened to be president of Mayflower Transit- - [Matt] Okay.

- In Carmel in Indiana.

And, you know, being in logistics and the moving industry, it's all moving stuff.

And it really appealed to me.

And, you know, as a young man and you know, you got a president of a company telling you, "Hey, I want you to work for my company," you tend to listen to that.

- [Matt] That's pretty cool.

- So that's kind of how I got into it.

It was through Rick Russell, my fraternity brother, Rod Russell, "Hey, when you get outta the Navy, you gotta come work for us."

- That's pretty neat.

So, you've now been with Federal for many years.

How many years have you been there?

- This year will be 21 years with Federal.

- [Matt] That feels good, doesn't it?

- Yeah, it's goes by fast.

- [Matt] It does.

- Just.

- That's pretty amazing.

And one of my favorite, it's one of my favorite things about business is longevity.

Not just individually, when someone is committed to a company for X amount of years, 'cause in today's day and age, it's hard to do that.

- Right.

- But, this business is an old business when you think about it.

When you hit the 100-year mark, it starts being cool.

Right?

- Right.

- And you guys hit that.

And so, how old are you now?

The business.

- So March 19th, the Federal will be 110 years old.

- [Matt] And that's a milestone.

- It really is.

It's something we're very proud of.

- [Matt] We have to have a party.

- We are.

And in fact (Matt laughs) it's funny you mentioned that, I was with John Morris yesterday at the Riverfront Museum and when we turned, when the company turned 100 years old, we had a community day at the museum, you know, Federal sponsored for everybody in the community to come to the museum, it's on Federal, we'll pay for everything.

And so, we're gonna repeat that on May 6th.

And- - Okay.

- The public will hear more from John and his team, but it's just our way of giving back of- - [Matt] That's pretty neat.

- You know, we'll have some fun with it.

We have a 1930 Model A truck, an original that's pristine condition, which- - [Matt] Oh, wow.

- People just like, 'cause you don't see, you see Model T cars, you just don't see the Model A trucks.

So we'll bring that to the museum so the kids can see it, but, it's on Federal.

It's our way of saying thank you to the community for allowing us to be in business 110 years.

- Yeah, and that goes to what I said at the beginning, that philanthropic piece.

But, what I like is, I like talking about the history.

So, in 1913, the Ullman, Clarence Ullman, founded it.

And I knew Don.

And, so I'm sure there was others in between, but when you think about a family-owned business like that, there's something in this day, that's Americana to me.

I mean- - Yep, right.

- I'm using my dad's term- - Right.

- 'Cause he uses that that term, but it really is.

And that's pretty cool to work for a place like that, isn't it?

- It is.

And the Ullman family is such a, they are such giving people.

I think that's where a lot of our culture came from, that they believed in giving back and all the charitable organizations that they belong to.

It was just, if you wanted, it was almost a requirement.

If you want to be a manager at Federal, to get to that level, you are expected to be involved in philanthropic.

It's what we do.

We help people.

- [Matt] Right.

- I mean, moving, psychologists will tell you, it's the fourth most stressful thing in one's life.

Death, divorce, job change, moving, three or four and- - [Matt] Wow.

- It's what we do.

- So- - That's- - It's a natural for us.

- Right.

One thing I really like about your team is that you just have some loyal long-term employees.

And you can't, you're in a business, and I know you could say this probably for every business, but you're in a business where, it's really hard, I would think, to train and to get new people up to speed all the time.

So the long-term employees, the people that are those loyal people, it's gold, isn't it?

- It is.

And I think, with the recent pandemic that we went through, companies realized that.

I think customers realized that, because- - [Matt] Good point.

- You could have a lot of customers, but if you didn't have people coming to work, it didn't matter how many customers you had.

Now, we value all our customers, so don't take that, but without, you have to have people.

- You have to have people, but you also have to have that customer service piece, and the knowledge.

Because if I'm in that stressful mode of moving, I wanna talk to you and your team- - [Jeff] Right.

- And have you put me at ease.

And that's part of your job too- - [Jeff] It is.

- To say, "We've got this," right?

- Yeah, when we, you know, train, recruit, hire, et cetera, we always tell people, you know, "We're a customer service company first."

The moving's the easy part.

- [Matt] Okay.

- You know, getting something from point A to point B, but it's being the counselor.

Some moves are, people are very excited, it's a promotion or it's a retirement or whatever.

Some aren't so good situations, and you have to be able to, in the home, deal with those emotions and help people get through it.

And I think people that have been with our company, which is, as you point out, it's really neat to celebrate 20-, 30-, 40-year anniversaries every month in our company.

That's what they would say is, "I'm here 'cause I like helping people."

- Yeah.

And I don't say this about a lot of companies, but I've been to your place and given some talks before about community and you've had me come in at holiday time and talk, and I've always, I've never said no.

Because I've always enjoyed your team, and you have a lot of good people.

But I want to go back to the customer service piece because I think in the business and the sector you're in, it seems to me it's kind of a lost art.

And I think a lot of businesses could say that, but I think that's one of your initiatives that you actually can hang your hat on.

- It is, and because no matter what technology you have, we're a face-to-face business.

And we have to be.

You know, during, again, I mentioned during this pandemic where a lot of organizations, people were working remotely or, we didn't have anybody do that.

We couldn't, it's not what we do.

- [Matt] Right.

- I mean our, I'm so proud of our employees that, during the pandemic.

I mean, think about what was going on.

And we had employees, and our owner operators, going to other people's homes, helping them transition with their life, helping with their moves, et cetera, when the rest of the world was being shut down saying, "Don't go outside."

- [Matt] Yeah.

- And so, I couldn't be more proud of what our team's accomplished the last two years.

- You know, when I think about what you just said, I really relate it to the business I was in at Children's Home but I was, we didn't have a day off, but I was also thinking medical and all the obvious, but I wasn't thinking about this one, and this one's very important.

Because your business is so vast, most people, so if someone came up to you and said, "Jeff, what is Federal Companies?"

- That's a great question.

- What is it?

- And I'm gonna give credit to one of our former board members, Dr. Aaron Buchko at Bradley.

Aaron came up with the phrase, "Federal's in the stuff business."

(Matt laughs) And you know, we thought about it and we were like, "Yeah, we really are."

We get stuff from point A to point B, safely, securely, on time, whether it's people's personal effects, whether it's cigarettes, or if it's ventilators during the pandemic, company's products.

That's what we do.

We warehouse stuff, we get something from point A to point B on time.

- I mean, think about that, too.

You had not only ventilators, but all the masks and all of the- - [Jeff] Right.

- You know, I mean that's just crazy.

- Yeah, I'm very proud of the fact in 10 days of pandemic, we delivered 880 ventilators statewide in 10 days.

- [Matt] Wow.

- And very, very, I mean, but that's our, we didn't, my partner and I, Randall Schrock, we never had to explain to our employees what we're doing or why we're doing it.

It was, it's what we do.

- I think what's hard though, is when you look at the trucking piece of it, you know, you have somebody that is, that you're relying on and they can't help it, but if they got sick, that's, logistically, can become a nightmare.

So that juggling piece, that logistics piece, I think is pretty, not only pretty, that's an obvious statement, pretty important, but I think it's pretty interesting how that piece is not thought about in your business, because it actually, probably, is the driver for everything, isn't it?

- It really is.

And people don't think about it unless there's no toilet paper on the shelves.

(Matt laughs) - [Matt] True.

- So- - I actually was thinking about that a minute ago.

- And I look at it and said, you know, "I think in 35 years that I've been in this industry, I think I've heard in the national news talk about supply chain twice.

And it's always when you don't, it's one of those things that, which I give our employees a lot of credit for, and especially any truck driver, or owner operators, you don't hear of them until something's wrong.

But what they do each and every day, whether it's a blizzard going on, the trucks are still running.

And when they don't, then you start seeing shortages.

And people just don't, they're taken for granted which, I always caution people, for about a week during the pandemic, you know, "Hey, slow down, let the truck drivers through."

I'd ask everybody, "Do that every day.

Don't cut in front."

They're so critical to what we need.

- I'm glad you said that, because that was part of one of my questions is, I think a lot of times people get irritated.

I've done it.

You get irritated at trucks.

You're like, "Get outta my way."

But you really, if you think about it, and you could say this about probably trains and waterways too, but the trucking industry itself is probably the most vital artery in what we have in America.

- In the early '70s, Teamsters went on strike for three days and it crippled the economy.

In three days.

- [Matt] Wow.

- And that was before just-in-time inventories.

- [Matt] Man.

- So, it's the backbone of our country.

And that's why people don't realize, logistics is the biggest industry in the world.

That's the other reason why I wanted to get into it.

And people don't think of, well technology, healthcare.

Logistics is far and away the biggest industry in the world.

Because everything you see just didn't grow there.

Something had to get shipped somewhere, to have it made, and then shipped to be put in place.

And like I said, we saw it during the pandemic when you have supply shortages, how critical supply chains are.

- So think about when you started, and then think about today with technology.

Because, if you're thinking about even routes and GPS and all these things that, you know, we just sit here on our phones and we get to point B pretty quickly and all.

But when you have, let's say 100 trucks, just throwing out a number, and you've got them crisscrossing everywhere, fuel's a piece of this- - Big piece.

- [Matt] Insurance is a piece- - Huge piece.

- Safety's probably number one in your business.

- [Jeff] Yes.

- It's probably, I'm guessing in your strategy because in your business, I know this from past partners and people that work there, your strategy is key to driving everything you do, right?

- Well, it has to be.

And it's one that whether three people know it, that's not, everybody needs to be engaged in it.

And that's what we preach.

And safety's always first.

And as you know, we're failed former athletes of, you know, ability.

What's the best ability?

Well, it's availability.

(Matt chuckles) - [Matt] Very true.

- It's availability.

And whether it's in sports or in business, if people don't show up, that's why I want them to be careful, we do a lot of training, how to do things safely.

We need people to show up.

- Yeah.

And it goes to when you think of Federal, you think of moving, but you just mentioned another piece that I wasn't even thinking about.

Training.

So to have safety, you have to train.

- [Jeff] Right.

- So you have the training piece, you have the logistic piece, you have the, all the innards business pieces involved.

But you do so much more than what people just assume.

You know, 'cause you drive by your facility.

- [Jeff] Right.

- You see a lot of buildings, you see some trucks pulling in and out, you go, "That's a nice piece of land.

That's huge.

But what is it?"

- Yeah, we do a lot of different things.

Certain things I can't share with the public, but a lot of things that we do is we warehouse for companies.

We're their partner.

A lot of our customers in the warehousing side of the business aren't based in the Midwest.

Some are in Japan, some can be in China, some can be in Europe, some can be on the coasts.

And we're their distribution partner, an extension of them that, we're their warehousing that products come into and then gets out to their customers.

So, we do a lot of final, what we call final mile piece.

Whether it's product or services, it's our home delivery business, somebody buys an appliance, it's not gonna be an Allied orange truck that shows up, it'll be a Federal white truck.

But we do, we're very diversified.

We own a data center, we back up for a few companies here in town and throughout, actually, different companies in the world that our cloud is in East Peoria.

- [Matt] Isn't that cool?

- We warehouse physical product and then we own a data center as well.

- So what would a data center do?

Besides the obvious?

- Well, it can back up companies' servers.

- [Matt] Oh, okay.

- We'll back up their servers whether it's nightly or daily or every hour based on what their needs are.

- So, one of the things I've always thought was kind of cool is the specialized moving piece.

So when you're talking about, when you watch like, the auctions on TV for cars and you know, you have a $100,000 car, you know, that's that person's baby right there, right?

- [Jeff] Right.

- So it is important.

I'm expecting you to get this to where I need it.

Motorcycles are another thing.

- Right.

- It can't be very easy to sit there with a wobbly motorcycle to figure out how to transport them.

But you do it.

- Yeah.

It took, I think we've done over a million motorcycles over the years- - [Matt] That's crazy.

- And we're the official for Harley-Davidson, so if any H.O.G.

members that are watching, you know, call us funtransport.com.

And we went through like, six different generations of skids of how to safely do these, working in conjunction with Harley-Davidson, and trial and error and what's the best way to do it.

And a million-plus motorcycles later, it's another part of those businesses people don't think about when they drive by it, but.

- They don't think about it.

But think about this.

The average person not only doesn't think about it, but you're talking to one of the biggest brands in the world.

- [Jeff] Right.

- Harley-Davidson.

So for Harley to trust a company in East Peoria, that says something.

- Right.

- Right?

- Yeah, and you can imagine certain manufacturers that make appliances where they're just, where we do their home delivery services for the big box and for certain manufacturers as well.

- You know, I was going the route of trucking, but then I was thinking, your facility is located on the river.

People forget, too, how important the river is.

- Oh, it's huge.

- It's huge.

- The river, the rail.

And that's our corporate offices everybody sees in East Peoria.

We're in St. Louis, we're in North Side of Chicago in Lindenhurst, we're in Champaign, we're in Bloomington.

So we're pretty diversified.

- [Matt] Yes, you are.

- And it's interesting how, when the company started, when Clarence started the company, you know, Peoria County was, you know, paying more excise tax 'cause of the whiskey business than any other place in the United States.

And so Federal started out working with the whiskey manufacturers of warehousing it.

- [Matt] I didn't know that.

- And then, interesting, you know, a few years later as they're growing, "Hey can you," and I'm talking back in the days of horse and buggy, before trucks.

We'll talk technology.

"Can you move our people?

We've got somebody that needs to get out to Kansas City," or et cetera.

And, "Okay, we could do that."

But we would have to, we use the word deadhead, we could go out there legally and deliver their new employee or managers, et cetera, but we'd have to come back empty.

It was against the law, in 1915 to 1920s, to send a shipment out somewhere, you are not allowed to put anything back on it.

So in 1920, yeah, it makes no sense today.

So in 1928, Federal, along with 40 others like us throughout the United States, created Allied Van Lines.

- [Matt] Wow.

- So we were one of the founders of Allied and- - [Matt] I love that.

- And the whole being, so it was now an Allied, the first van line in the world, it was now a Allied shipment going to Kansas City or Denver, et cetera, and an Allied shipment coming back, not a Federal shipment.

So, that's how the whole van lines got created.

- [Matt] I never knew that.

- It is.

And to think about it, I mean, we're talking 100 years ago.

- I tell you, someone just asked me, they said, "What's the best thing about the show?"

And I said, "I get educated every 30 minutes."

(Jeff laughs) It's just fun.

That's a great stat.

So, I want to go back to the training and safety because I think it'd be very hard.

How do you stay on top of what's cutting edge in safety?

I mean, you have to have some pretty strong safety managers and trainers.

- We do.

We have a very talented individual that spearheads it and that's all he does.

- [Matt] Wow.

- Yeah, and then it's his job to make sure all of our managers, all our employees, and.

But you know, that's the beauty of being 110 years old.

You have processes in place.

- Yeah, that's true.

That's true.

And you mentioned kind of earlier that everybody within the organization knows the strategy, but that's your mentality with everything.

You're a very transparent company, internally.

- We run Open-Book.

- Open-Book.

- Which is, we play what's called the Great Game of Business.

- That's Jack Stack.

- Jack Stack's- - Yeah.

- And so we've won some awards for that, and, you know, I think it comes down, some of the benefits are trust.

Now, we don't share salaries, et cetera, but every month we share our P&Ls with all of our employees, including our union team members, so, there's no hiding.

And you share the good and the bad.

And the philosophy's been, you can't fix the bad if you don't communicate.

And that's why, here's what's good, here's what's bad, what do we do to fix it?

And, you know, in 110 years, not everything we do is right.

And instead of hiring a bunch of consultants, we talk to our employees.

How can we get better?

- That's crazy, because about 10 years ago, I had actually, I don't know if you remember this, but I talked to you about this, and I went out and got the book, because I wanted to understand it more.

And it is very interesting.

And when you read the book, you almost don't understand why more businesses- - Don't do it.

- Don't do it.

- I think it's pride.

- [Matt] That could be.

- The other- - Well, or ego.

- Or ego of, you know, I'm not gonna tell my employees I made a mistake.

I tell my employee I make mistakes every day.

- [Matt] Every day.

- I hope don't make what the company doing it, but either, if you're not making a mistake, you're either not trying or you're lying.

(Matt sighs) - So, everybody is looking for good people to work for 'em.

How do you go out and market that you're a best-in-class business in the sector you're in to get people, whether it's truck drivers or whether it's front office.

- I mean, our best recruiting tool by far, is our employees.

We use the, you know, all the services that are out there like everybody else does.

But at the end of the day, it's people wanna join our team if they know somebody, who can tell 'em, "Hey, I'm an employee, this is what I do."

They're our greatest resource.

Whether it's attracting new people or even customers, talk to our people.

- Yeah.

Somebody told me once with you, this was a few years ago, is, they always have the best equipment.

- [Jeff] Right.

- And you know, as a owner, you're sitting there going, "Boy, look at that cost."

- [Jeff] Very expensive.

- It's very expensive.

But then on the flip side, it's gotta pay three X or five X.

You gotta be thinking that way, because the next business over the other side of the river that maybe doesn't have that piece.

- [Jeff] Right.

- So that is an edge that you have.

Is that how you think?

- It is.

I mean, we reinvest at least 30, 40% of our profits every year back into equipment.

- [Matt] Wow.

- And we have to because, especially during the shortages during the pandemic where one, you couldn't get trucks, you couldn't get parts.

So, we had a very, we don't have a what we call an aging fleet.

So we're always looking every year, let's keep reinvesting back into the business.

And that's why you don't have, we don't have the breakdowns that a lot of people will have.

We still have, I mean it's equipment, but it comes back in spades, the money we invest and.

But I think our employees like it too.

I think getting in a newer tractor, for example, as opposed to something that's 30 years old.

But that's our, we wanna make sure our employees have the best tools.

- I don't want to sound like a commercial here, but I, in studying your business, I found something on your website and I thought this pretty much sums up what I was thinking of you guys, because I've, like I said, I've been in your business but, "The right equipment and training helps our movers to make the moving process easier, safer and worry free.

If you think about that, I want, I, if it's important to me, it's important to me, right?

- Right.

- So it doesn't matter whether it's garbage or not, it's your job to make sure you get that there.

- [Jeff] Right.

- But it says, "You can rest easy knowing your items are packed with the right techniques and materials to arrive to your new home in one piece.

Everything's loaded with care and proper equipment."

That proper equipment is key.

- You have to have it.

- [Matt] You have to have it.

- And whether it's our, any business, I think.

- [Matt] Yeah.

- You have to have it.

If you expect your people to perform for your customers, then that's our responsibility to make sure that they've got the training and equipment.

- Yeah.

I want to end with, you know, Federal Company, you have a long history of philanthropy, and I know from you to Bill Cirone to all been on boards, you're talking Children's Home, American Red Cross, Disaster Relief, Wildlife Prairie Park, fishing for the Boys & Girls Club, Crittenden, the list goes on.

And I just wanna give you credit for it, because it's not just, this is our cause and we're gonna throw something this way.

It's the blanket over the community that you've done for 110 years now.

- [Jeff] Right.

- So, I think that is, you ought to be commended for that.

- Well, I appreciate that.

And it's what our employees wanna do.

And they said if you want to come to Federal- - [Matt] You go- - It's an expectation.

- You're gonna do it.

You're gonna do it.

- This is what we do.

- Yeah.

So, well Jeff, I appreciate you coming on the show.

Very fun business to talk about.

I'm Matt George and this is another episode of "Business Forward."

(gentle music) (air whooshing) (cymbals glistening) (bright music) (bright music continues) (bright music continues) (bright music continues) (gentle music) (cymbals glistening) (bright music) - Thank you for tuning in to "Business Forward," brought to you by PNC.