Keeping it in the family

A tiny snapshot from the operations at 3PL Mikhaiel Logistics demonstrates the company’s commitment to its customers. When the warehouse manager had a long-delayed vacation coming up, he spent the four months ahead of time fully training his temporary replacement to do every part of his job.

The handover and vacation period went smoothly, according to Mikhaiel customer Ryan McGovern. He works for Princess Auto, a retail chain that specializes in farm, industrial, garage, hydraulics and surplus items, as its senior leader of transportation. They use Mikhaiel for truckload deliveries from their Milton, Ontario, DC to stores in Eastern Ontario, in Ottawa, Kanata and Kingston, to the tune of up to 14 loads a week. The 3PL also does vendor pickups on the backhaul.

In an environment that’s very much a buyer’s market, where he’s turning down a carrier a day looking for work, McGovern says it comes down to the partnership and relationship with the people at Mikhaiel.

“We’re very relationship-based as a company, and Mikhail is similar. We can pick up the phone, we can have a conversation. It’s real, it’s not clinical,” he says.

Although the company is young, Mikhaiel’s roots go way back to the early days of Walmart’s entry to Canada in the 1990s. That’s where brothers San and Sar Mikhaiel met Rob Seymour and the three soaked up everything they needed to know to run a logistics company. In 2002 the Mikhaiel brothers and Seymour launched a transportation and logistics company called Islandwide. They sold the business in 2015.

But when the pandemic hit, opportunity knocked. The brothers called Seymour up and they started Mikhaiel Logistics in 2020, with one client, Rolf C. Hagen, the pet supplies manufacturer. Since then, they haven’t looked back, and have seen 40 percent growth year over year. San Mikhaiel and Seymour are the customer-facing guys, while Sar keeps things running smoothly in the background, more focused on operations.

Princess Auto came on as a client in 2021, joining Hagen and the Hillman Group. Dollarama is a new customer, having joined in 2023.

The company currently operates from four facilities, Oakville and Belleville, Ontario, Calgary, and Las Vegas (see sidebar for details). The Vegas distribution centre just opened.

And there are plans for more. A new Belleville facility is slated to open in the fall of 2024 with 375,000 square feet, and another with 200,000 square feet in Balzac, Alberta, will start operations around the same time.

Rob Seymour, who carries the title of vice-president of transportation, characterizes the company as a family business. “We’re a family run company. We treat our employees with respect. We brought back a lot of our employees that we had from the past. And a lot of our drivers too,” he said.

Part of that success comes from borrowing from Walmart, San Mikhaiel, who is president, said. “The model they had was you move departments every three months so that you could do everyone’s job. We do the same thing here where we cross-train all the staff so that if there’s ever vacations or if there’s people who leave, or go to another company, we always have other people who can step into the role of any function inside of a facility.”

Avoiding corporate bureaucracy makes business more straightforward, he added. “We’re not typically corporate. We’re looking at bringing on more senior management, but we still like to get involved and, run the day-to-day. There’s no politics or anything like that. We make decisions quickly. There’s no ladder to climb.”

San echoes Seymour’s sentiments about family. “That’s pretty much our model. It’s like three brothers. We call ourselves three brothers – me and Rob and Sar. We know every staff member, and make sure they have a sense of purpose.”

So what the secret to the company’s rapid growth? According to San, what differentiates the 3PL is that they are trying “to find ways to save our clients money, and still turn over a reasonable profit. They see that we’re trying to work with them, it opens up their eyes to different ways of doing the business, and they haven’t seen that before,” he explains.

“No matter how big they are, their success obviously has to come first before ours, because if they’re failing, then obviously the business is going to go away, or it’s going to diminish or decrease. So we try to put our best foot forward in terms the quality of service, the quality of employees, and get all the employees to buy in that they’re not only working for us, that they’re a direct reflection of the clients that we represent.”

Trevor Bowie of Rolf C. Hagen agrees. Mikhaiel manages two warehouses in Canada and the one in Las Vegas for the pet supplies maker. They perform picking, packing and shipping as well as direct-to-store deliveries, and are responsible for 70 to 75 percent of Hagen’s Canadian transportation, Bowie said. The last part entails a lot of stops at small, urban mom-and-pop shops.

“They do an exceptional service for us. It’s a bit of a white glove service that they provide for us. It’s not the easiest thing to do, especially in some of the more dense urban areas. They deliver to small retails, parking’s an issue,” Bowie said. “And I’ve been with other companies doing the same things. And this has always been a problem for us. And they manage all of these things seamlessly and it really has been a good relationship.

Flexibility is another attribute that Mikhaiel’s customers emphasize. Bowie noted that as Hagen’s business has been growing, the 3PL has been extremely accommodating. “Flexible relationships permit us to guarantee growth, limiting disruptions in the supply chain through them working with us on space allocation and warehouses,” he explained.

“So we can build a 200,000-square-foot DC or a 400,000-square-foot DC and commit to taking a certain portion of it with a guarantee for them over time, that that space will never be empty. It reduces our cost at the beginning of the term. And then they use that space for their own business. So they look for flexible arrangements as we grow, but also as they grow. And it gives us both the opportunity to be more efficient in our operations.”

Princess Auto’s McGovern has a similar story: “We were moving distribution centres in Milton [Ontario] last year, and we needed some extra equipment, and it was tight. I know that they were taking work away from themselves by providing us trailers just to shuttle back and forth between our buildings when we needed them. They freed up some yard space for us. These were all things that were not good business decisions for Mikhail, but a good partnership move for us.”

It comes down to building long-term relationships, San says. “We’ve helped out many clients like that, where we want them to succeed. For us, it’s a marathon. We want to be servicing these clients for like 20, 30, 40 years.

“They know they can come to us for anything and make any request, and we’ll follow through. And they’re always there for us as well.”