Food for Thought

[ATeam]

Bigger companies serving the expedite market is not a new development, but my guess is people in the Roberts days did not have to keep their eye on competitors like those shown below.

As time marches on, I wonder if the only thing left for expediters like us to differentiate ourselves from the bigs is true emergency freight service and exclusive use shipments.

It seems technology is making it easier and easier for carriers of all kinds to track shipments and provide time-definite service. Freight of all kinds is moving faster and faster from shipper to consignee.

The following is from the YRC Worldwide, Inc. 2007 Form 10-K.

Yellow Transportation offers a full range of services for the movement of
industrial, commercial, and retail goods and provides transportation services by
moving shipments through its regional, national and international networks of
service centers, utilizing primarily ground transportation equipment that we own
or lease. The Yellow Transportation mission is to be the leading provider of
guaranteed, time-definite, defect-free, hassle-free transportation services for
business customers worldwide. Yellow Transportation addresses the increasingly
complex transportation needs of its customers through service offerings such as:


• Exact Express® - a premium expedited and time-definite ground service with
an industry-leading 100% satisfaction guarantee;


• Definite Delivery® - a guaranteed on-time service with constant shipment
monitoring and proactive notification;


• Standard Ground™ - a ground service with complete coverage of North America;


• Expedited Direct™ - an expedited air forwarding solution for one, two and
three-day shipments;


• MyYellow®.com - a leading edge e-commerce web site offering secure and
customized online resources to manage transportation activity.

Roadway provides transportation services for similar categories of goods as those that Yellow Transportation delivers. Roadway primarily offers LTL service yet also offers truckload services to complement its LTL service, usually to fill back hauls and maximize equipment utilization. In addition, Roadway provides higher margin specialized services, including guaranteed expedited services, time-specific delivery, North American international services, coast-to-coast air delivery, sealed trailers, product returns, cold-sensitive protection and government material shipments. The Roadway suite of time-based services provides customers the flexibility to choose next day and beyond service on the ground or in the air at any hour, day or night, anywhere across North America with extreme reliability. These service offerings include: • Time-Critical ™ Service - a premium expedited and time-definite service via ground or air anywhere in North America with a 100% on-time guarantee, delivery windows as precise as one hour, and options to charter partial or entire aircraft.


• Time-Critical™ Multi-Day Window Service - a service option providing customers the ability to select any size multiple day delivery window and is guaranteed not to deliver early or late. Multi-Day Window service is ideal for vendors shipping to retailers trying to avoid costly charge-backs when faced with strict window delivery requirements.


• Time-Advantage™ Service - Roadway's newest expedited service option providing customers the ability to pick the speed to match their need on the ground or in the air anywhere throughout North America.


• Sealed Divider™ - a patented, dedicated service providing extra protection and verifiable security in transit through a numbered rod-lock seal system with customers paying only for the space used on the trailer.


• My.Roadway.com - a secure e-commerce web site offering online resources for shipment visibility and management in real time.

 

[greg334]

Bigger companies serving the expedite market is not a new development, but my guess is people in the Roberts days did not have to keep their eye on competitors like those shown below.

As time marches on, I wonder if the only thing left for expediters like us to differentiate ourselves from the bigs is true emergency freight service and exclusive use shipments.

It seems technology is making it easier and easier for carriers of all kinds to track shipments and provide time-definite service. Freight of all kinds is moving faster and faster from shipper to consignee.

Phil,
What do you think I have been saying for a while?

This part of the industry has pretty much evolved to the point that the line between types of freight has blurred to the point companies, like FedEx (Roberts) has been using all kinds of freight to keep trucks rolling more and more.

The competition has grown from Roberts (FedEx) to about an infinite number of companies that provide a like service because they see this as a cash cow. I think in many ways, like other things in transportation, the competition has raised the customer service bar. Many companies quote short delivery time at reasonable pricing as part of simplifying the customer service, not because the customer needs it right now.

Of course there are many cases that there are needs that use ‘exclusive use’ trucks. I think FedEx is a perfect example on what is blurring the line; they offer the customer several options and one of these options is sticking the freight on a CC truck, dropping it at FedEx Freight and then on the other end picking it up from Freight and delivering it via a CC truck – where is the exclusive emergency use? The time is lengthen to save the customer money and capture that all important freight. There is a lot of freight that would have ended up on a CC truck that ends up on freight, you don’t see it and no one talks about it but it is there.

I am wondering why you think that these bigger companies are not doing any emergency freight service and exclusive use shipments or have not been doing it for a long time?

It didn’t surface a lot, a lot of companies worked with specific customers to find solutions to their needs, going back to the 50’s. What I think is different from the past is simply they are offering the services to the public instead of one or two companies. For example I picked up several times at a company local terminal who services Chrysler and they do the same thing as we do - emergency freight exclusive use shipments because Chrysler is their customer.

Technology allows them to move beyond the logistics expert sitting behind the desk figuring out routing to a computer which can route a package quickly. Go see how the Post Office moves things, go see how the military moves things – you will see how things move, the bigger freight companies use the same principles and now they can move things faster by routing the freight via computer based on the same principles.

What ever happen to the Expediters history book?

 

[Moot]

One could view these companies as either a competitor or a customer. Most LTL carriers offer some type of premium expedited service with a guaranteed delivery time. The very nature of a LTL systems requires freight to be handled several times between the shipper and the consignee. This coupled with the volume of shipments lends itself to service failures. That's when the call goes out to exclusive use, dock to dock expediting companies.

I get freight from LTL companies several times a month.

 

[dhalltoyo]

I love YRC.

I move a lot of their "Expedited" freight.

XYZ COMPANY: Ring..."Can you (YRC) deliver two skids of parts from our plant in East Uhunga to a location 500 miles away within 12 hours?" "Yes, we have a truck (TT) within 5 miles of your location that will be there to pick up those skids."

YRC DISPATCH: Ring..."Can you (Tri-State, Panther, Nations Express, Bolt, Express 1, ad infinitum) send a cargo van to meet our truck at Terminal 5 near East Uhunga in one hour for a load of two skids going 500 miles south?"

It is just good business to advertise that you have all of these wonderful services. Outside of regular, 72 hour, coast-to-coast time frames, YRC, and many others, contract the "Deliver Direct" "Single Load" "Emergency" freight to those companies with fleets and infrastructure configured to handle such.

Those companies whose fleets and infrastructures were developed to maximize TT loads have found it difficult to merge regular TT and expedite under the same umbrella; Conway is a recent example. Landstar is having some second thoughts about the expedite division. UPS has not agressively pursued the "Deliver Direct" "Single Load" "Emergency" freight. FedEx has segregated it to contractors via Custom Critical; not to mention the other components of FedEx's infrastructure that are also handled by private contractors.

 

[Moot]

I love YRC.

Those companies whose fleets and infrastructures were developed to maximize TT loads have found it difficult to merge regular TT and expedite under the same umbrella; Conway is a recent example.

Con-Way Now was a separate entity much like FEDEX CC. It is my belief that they exited the expedite business to concentrate on TL division as evidenced by their recent purchase of CFI. And dare I say the ROI wasn't what they thought it would be when they started Con-Way Now.

A fair share of Conway's truckload freight is actually Conway Freight (LTL freight) moving between midwest and west coast terminals.

 

[dhalltoyo]

Con-Way Now was a separate entity much like FEDEX CC. It is my belief that they exited the expedite business to concentrate on TL division as evidenced by their recent purchase of CFI. And dare I say the ROI wasn't what they thought it would be when they started Con-Way Now.

Agreed. Those with infrastructures to handle large volume freight shipments will concentrate on those areas. Landstar has three TT divisions and they directly manged those operations. Those divisions are very profitable. Landstar Express America is not fully under the corporate umbrella because loads are assigned through brokers. In recent months, competition has driven LEAM's cpm rate way down.

My analogy is likened to a parent who has two children, remarries and intregrates a step child into the family. The parent keeps telling the new addition, "I love you just like one of my other children," but the step child keeps getting the "hand-me-down" clothes instead of the new stuff.

Landstar, UPS, FedEx, etc. seem to cloth the immediate family quite nicely, but the step kids are beginning to look a little frumpy.

 

[Moot]

I agree! When you look at the big corporate picture, expedite contributes such a minuscule amount to the bottom line of these corporations.

I have noticed that UPS has been plowing more money into the former Overnite Transportation. Overnite had been neglected for years by Union Pacific and a long strike by the Teamster hurt them.

 

[dcalien]

It's ok with me if they want to advertise. I haul yellow stuff sometimes. And as far as hand me down freight, the dollars it pays are still green.

 

[Coco]

My analogy is likened to a parent who has two children, remarries and intregrates a step child into the family. The parent keeps telling the new addition, "I love you just like one of my other children," but the step child keeps getting the "hand-me-down" clothes instead of the new stuff.

Landstar, UPS, FedEx, etc. seem to cloth the immediate family quite nicely, but the step kids are beginning to look a little frumpy.[/QUOTE]

We were adopted on January and dress quite well thank you.

 

[Jefferson3000]

Hey Phil, A lot of those services offered are 3PL: 3rd Party Logistics. When Exact Express has a long distance expedited load, just guess what they do? They call LEAM, Bolt, C & M, and Panther. When they have a load that would be construed as a "mini", they call local cartage companies such as Freight Force, Mid-South Express, Lykes and a host of mom and pops. Who cares how the freight comes? It's still gonna end up on my truck.

 

[CharlesD]

One could view these companies as either a competitor or a customer. Most LTL carriers offer some type of premium expedited service with a guaranteed delivery time. The very nature of a LTL systems requires freight to be handled several times between the shipper and the consignee. This coupled with the volume of shipments lends itself to service failures. That's when the call goes out to exclusive use, dock to dock expediting companies.

I get freight from LTL companies several times a month.

I get most of my loads from other companies. No company is ever going to be able to cover every piece of freight that comes their way, so I figure there will always be a need for the smaller operations to service the big boys and handle their excess. I would say that 90% of what I haul is stuff I get from FedEx, Panther, Express 1, Prestige, etc.

 

[CharlesD]

It's ok with me if they want to advertise. I haul yellow stuff sometimes. And as far as hand me down freight, the dollars it pays are still green.

Except for some of those new bills with the other colors mixed in.

 

[arrbsthw]

We have picked up a load for Fed Ex at the Yellow Freight Terminal before. Can't
remember where we took it.

 

[davekc]

I think what cracks me up is that many Fedex folks think they are hauling some type of prestigious freight.
Little do they know that many of us are hauling the same thing for a higher rate.
Especially the ones that keep saying, broker freight doesn't pay".
I laugh my behind off every time we pick one up.

 

[arkjarhead]

It shouldn't matter what it is or where it comes from as long as it pays. Heck I hauled a load of human feces from Stuttgart,AR to Va.Beach,VA for a buddy of mine once. It was just like soot. It paid good though. I hauled it in a grain trailer. They used it for fertilizer. I've also hauled chicken manure. Hey whatever pays the bills. My grandfather hauled ground up fish and cow bones (fish mill and bone mill) for pet food when he was living. He also hauled some stinking stuff called blood mill for pet food. You have to pour kool aid in hoppers to get the smell out after hauling any of that stuff.

 

[Jefferson3000]

I think what cracks me up is that many Fedex folks think they are hauling some type of prestigious freight.

I think you have hit the nail on the head. That's the rose-colored glasses.

I checked with Con-way not too long ago about hauling a non time-definite LTL (4 skids, about 6000 lbs) from Orlando to Los Angeles Metro area. About 2210 miles. Their discounted price was like $6250. Their original price was around $8000.

All I can say is some can believe the hype about themselves if they like.

 

[davekc]

There you go.
I seldom respond to some of the posts of that nature, but I have seen a few lately from folks that are so misinformed.
As you found out, the broker freight even get 100 percent of the fsc, rather than just a part of it.

 

[Bruno]

I think what cracks me up is that many Fedex folks think they are hauling some type of prestigious freight.
Little do they know that many of us are hauling the same thing for a higher rate.
Especially the ones that keep saying, broker freight doesn't pay".
I laugh my behind off every time we pick one up.

Now Dave, we all don't think like that lol. Honestly we all are hauling some prestigious freight. If you think about it. No matter what company you are leased on too.

 

[ATeam]

Little do they know that many of us are hauling the same thing for a higher rate.
Especially the ones that keep saying, broker freight doesn't pay".
I laugh my behind off every time we pick one up.

Help me understand what you are saying here. Are you saying broker freight pays more than Panther and FedEx freight? Or is it Panther (to whom you lease your trucks) pays more than FedEx?

 

[nightcreacher]

Dave ,you know the broker load is going pay more than fecc,i have to give 40% to them,but thats only if the broker gives you the load off the top.How many of these brokers deal from the bottom.Those three years I was with Con-way Now,they hooked me up with many broker loads,after all I was on a $1.05/mile flat rate.oh and never any surcharge,broker didnt pay,ha ha.As I was thinking of getting my own authority again,as I had it before Roberts days,i would always see what load pay would have been if I had went straight to them.In most cases,the broker wanted to deal with multi truck owners,second,only now and then would the load pay enough to concider it more than cheap freight,as an expedite load.Sure i could always LTL the loads,Ive done that plenty back in the early 80's,I use to get 6000 dollars to california hauling nuts and spices off the peers of new york,4 days loading,3 days to california,4 days unloading,and always 80000 lbs +,then produce back to hunts point,no wander I'm so old,lol.BUt the street walkers were a vision,naked under those rain coats,flashing for customers,well thats another thread.A million stories in the naked city.