Countdown To The 21st Century

How can black companies thrive in the new millennium? Our economists offer imperatives CEOs must embrace now

have to own 100%? Or does it mean that I do what Bob Johnson has done and form alliances with larger corporations where I may not own 100%, but I can use those alliances to create a larger business, to put more people to work and to own a significant business that actually creates wealth and jobs. I think that’s what black businesses have to consider into the next century.”

“What happens,” says Conrad, “is that some people who become entrepreneurs do so because they want to be independent. But then they don’t recognize that sometimes you have to give up a little independence in order to grow.

However, says Swinton, it is important to recognize the value of companies that are truly black-owned and to be careful about the potential dilution of black ownership. “African Americans own less than anybody else in this country by far,” he asserts. “I don’t know that we should discourage people from wanting to own and maintain some kind of identity as an owner.

“But,” Brimmer counters, “it is highly desirable for black-owned firms to look for opportunities in trying to develop relations with .major firms where they can get some business.”

One example of a minority firm doing just that is Active Transportation, a returnee to this year’s BE 100s. Active’s CEO Charlie Johnson, recently signed a $315 million deal with the Ford Motor Co. to haul their new cars from the assembly plants to dealerships across the country.

Johnson’s affiliation with Ford isn’t a new one. The partnership began in 1984, when Ford was looking to revitalize its minority supplier development program and Johnson’s firm, then a fledgling concern named Johnson-Houston Trucking, had two Ford trucks and employed two drivers. The $15 million company was primarily hauling truck parts for Ford, beer for Anheuser-Busch and stoves for General Electric. “At the time there were no minorities in ‘out haul,’ where you transport the new vehicle to the dealer,” says Ray Jensen, director of minority supplier development for Ford. Jensen says, with hauling rigs that average $100,000 a piece, few minority firms had the support mechanisms to fully exploit the industry. But Johnson had his eyes on bigger and more lucrative business. In 1994 Johnson, with backing from Ford, hit a home run by putting together a joint venture with Jupiter Transportation Systems Inc., a $250 million truck and heavy equipment hauler in Kenosha, Wisconsin. They merged to form a third company, Active Transportation. The relationship was formed so Johnson would own 60% of the new business and Jupiter Transportation would have 40% equity. In that time, says Jensen, the company grew from about $25 million in revenues to $80 million. When one of the owners of Jupiter died, Johnson bought out the other nonminority partner for $100 million and the firm became completely minority owned. Over the course of the last four years, Johnson has had a lucrative and thriving relationship with Ford, which culminated in March 1998 with the announcement of the multimillion-dollar deal.

“Active Transportation

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