Good day,
New technology plays are coming thick and fast – and not just from disruptive outsiders. Many established players are now working to transform from within and an increasing number are actively incubating start-ups. Commercially and operationally, what these digital initiatives generally share as a goal, and need, is comprehensive, automated, systematic visibility to events, processes and status.
According to the WSJ, XPO Logistics is the latest transportation company to offer customers an online freight marketplace, bringing big investment and the company’s own ready-made list of shippers and carriers to fire back at the upstarts. The company launched XPO Connect earlier this year with a pilot using about 50 shippers. It’s now opening up more widely. The advantage that such incumbents have over the upstarts, naturally, is their massive brokerage network.
For now, the industry hasn’t quite done away with the freight middlemen yet, in spite of disruptors’ efforts such as Uber Freight, Transfix, and Convoy, as well as a litany of apps and other cloud-base software “solutions.” Without the networks, however, the smaller upstarts are getting the traction they need, in spite of investor interest.
Did you know?
According to Focus Economics, the price of hot-rolled coil traded at $820 per metric ton on March 8, the date Trump announced the tariffs. That was 10.5% higher than on February 8 and 30.4% higher than a year ago. On April 10, it closed at $868. On Jan. 2, 2018, it was selling for $660. Futures contracts for the coil are selling at $835 for June 2018, according to CME Group.
Quotable:
“Treat your drayman and your trucker like your customer, if not better. My dad taught me that and I’ve always lived by that. We go out and meet them in person. We take them out. We ask questions. They appreciate this, because most don’t.”
-Kristy Knichel, CEO and President of Knichel Logistics, speaking at TIA 2018
In other news:
A career trucker helps to steer the path for self-driving trucks
Jeff Runions went from owner-operator to full-time company driver, parts manager, depot manager, and now he’s a safety driver for autonomous truck company Starsky Robotics in Florida. (NPR)
GE reportedly looking to spin off or IPO for GE Transportation
Rather than straight asset sales, the hybrid deals would leave GE shareholders with stakes in multiple public companies. The possibilities include spinning off a division to investors or combining a division with a smaller public company in a way that avoids a big tax bill. (Wall Street Journal)
Maersk considers hiring first female CEO
Shipping is a traditionally male-dominated industry and may help explain why Maersk still has the second-worst gender balance ratio among major corporations based in one of the most progressive corners of the world. (Bloomberg)
Factors that could hinder the railroad industry upturn
Sluggish automotive production, service issues, NAFTA uncertainty, and declining coal volumes are all headwinds for the railroad industry (Zacks)
Online shoppers are going global while air cargo plays catch-up
Online shoppers are increasingly buying from international retailers, relying more on digital devices and seeking alternate delivery options, according to a study from UPS. (Air Cargo News)
Final Thoughts:
More than ever 3PLs are investing in sophisticated software that helps maximize their logistics efficiency. However, one often overlooked bottom line for their success remains old-fashioned partnerships. In today’s freight market, securing great alliances is one of the keys to growing a successful brokerage.
Hammer down everyone!
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