Newspaper article The Florida Times Union

STRATEGY: RAIL LINK INC. Shortline Railroads Make for a Good Connection

Newspaper article The Florida Times Union

STRATEGY: RAIL LINK INC. Shortline Railroads Make for a Good Connection

Article excerpt


From the outside, the railroad business doesn't seem much like an entrepreneurial field: It's an industry, after all, marked by old-fashioned heavy machinery and tracks that have been laid down decades in the past.

For railroad industry veteran James Benz, though, that old-fashioned business was ripe for growth, at least in the burgeoning shortline industry, in which he is now a major player.

Shortline railroads are the sections of track that connect a small number of customers with the larger, long-haul railroad tracks, which a company like CSX or Norfolk Southern will use to transport shipments a long distance.

Rail Link Inc., the company Benz founded in 1987, runs 26 such shortline railroads, connecting costumers in Georgia, New York, Arkansas and elsewhere with the mainline railroads.

Benz's success in running Rail Link recently led to him being promoted to chief operating office of Genesee & Wyoming Inc., a Connecticut-based company that acquired Rail Link nine years ago. Rail Link is the largest of G&W's seven subsidiaries, which also includes operations in Mexico, Canada and across the United States.

Benz founded Rail Link to jump on an opportunity he saw to provide switching services for large industrial customers.

Before businesses like Rail Link entered the marketplace, railroad cars were moved around inside plants -- a process known as "switching" -- by the major railroads, who would send out a crew once or twice a day to do the task.

That wasn't enough for larger customers, who can work more efficiently if they can get cars switched as needed. "So the railroads agreed to outsource that business," Benz said, leading him to start the company to meet that need.

Since signing up its first customers in 1988 -- a company that Rail Link still services -- Rail Link expanded to handle switching operations for 29 businesses, including customers in Brunswick, Ga., and Jessup, Ga.

From their, Rail Link expanded into operating short line railroads.

Shortlines are a growing part of the railroad industry, with the larger operators, known as Class I railroads, selling or leasing sections of track that only serve a few customers. …

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