Landstar purchase of NLM

Darmstadter

Veteran Expediter
Hello--long time lurker, first time poster.

I've seen NLM mentioned on here before and thought this article might have some interest to the folks in the forum. There is an announcement on Landstar's website about purchasing NLM and A3i.
 

greg334

Veteran Expediter
I don't see the real problems that you may think, this seems to be a part of their warehousing/larger picture.
 

DougTravels

Not a Member
It would still seem that the posters on NLM will demand competetive bids.

It would also seem like any carrier owning NLM may create some confict of interest issues.
 

greg334

Veteran Expediter
It would still seem that the posters on NLM will demand competetive bids.

It would also seem like any carrier owning NLM may create some confict of interest issues.

Huh?

You know how NLM works?

There is no conflict of interest by the way. It is the same as a carrier who has an exclusive contract with a company.

OVM, I was commenting on Fastman's comment.
 

DougTravels

Not a Member
Huh?

You know how NLM works?

There is no conflict of interest by the way. It is the same as a carrier who has an exclusive contract with a company.
I do not believe the main posters on NLM (The big 3) want an exclusive contract with Landstar, they want competetive bids.

I believe that it is open to all carriers who pay their respective membership/bidding fees and that it is a blind bidding system whereas you do not have access to others bids.

as far as a conflict that would depend on what the contract between the individual posters and NLM state. If for example Landstar being given the low bid info on loads before they place their bid. I believe the low bid is not always granted the load, so if Landstar can keep loads, when they are not the low bidder it would seem to create some conflicts.

The potential for Landstar to misuse their power and cause problems for other carriers including the rating of other carriers, awarding of loads, will definitely exist. This power could result in the posters of loads not getting what they pay for which is a competetive bidding system.

Hopefully the main customers of NLM will pressure Landstar to unload NLM, I cannot fathom that any carrier controlling NLM is in their best interest.
 

greg334

Veteran Expediter
I do not believe the main posters on NLM (The big 3) want an exclusive contract with Landstar, they want competetive bids.

Believe what you want, they want the stuff moved. They do not care how it gets moved or who moves it. They are in the manufacturing business, not the freight business.

I believe that it is open to all carriers who pay their respective membership/bidding fees and that it is a blind bidding system whereas you do not have access to others bids.

The system and qualifications are not like eBay, they don't open the system to everyone who wants to bid.

as far as a conflict that would depend on what the contract between the individual posters and NLM state.

Actually the contract is with the shippers, negotiated with them for the rates and the fees.

If for example Landstar being given the low bid info on loads before they place their bid. I believe the low bid is not always granted the load, so if Landstar can keep loads, when they are not the low bidder it would seem to create some conflicts.

Well first off I don't know if you know how Landstar works, it isn't like Express-1 or Panther, different puppy all together.

Second I don't see this as a problem because the contractors at landstar can refuse anything and it affects them to the point of dealing with that agent who offered the run. The agent system works very well in this case.

The potential for Landstar to misuse their power and cause problems for other carriers including the rating of other carriers, awarding of loads, will definitely exist. This power could result in the posters of loads not getting what they pay for which is a competetive bidding system.

See Doug, the problem is that they can't do all of that. The logistics system that we have right now is not what it was four years ago. There is a lot more interaction between carriers that happens behind the scenes to cover the customer. There is more of a divergence of the industry now than ever before. Our experts have it all wrong, mainly because he doesn't get out of his comfort zone to try different things and he doesn't understand this is not just expediting anymore. We are bluring the lines between generalized freight and expediting. Landstar has something like 8500 trucks in their fleet but only less than 400 in the expediting part of the business, so if they can't cover something, it goes external. I doubt if there is a lot of NLM freight that will go to express drivers, seeing the agents already have access and it is a losing thing for a lot of people.

Hopefully the main customers of NLM will pressure Landstar to unload NLM, I cannot fathom that any carrier controlling NLM is in their best interest.

THEY DON'T CARE.

You act like this is the only place in the world to find freight.

THEY DON'T CARE!

They are concern with moving Product A from Plant B to Plant C cheaply at the same time NLM allowed them to off load the work in finding a carrier to do the work while maintaining their budgets. I doubt that they will do anything to rock the boat right now, they need NLM for the next few years in their condition.

Oh and the last thing you miss is that Landstar has been pushing the warehousing, which is counter to the JIT concepts and practices but still useful for the customer. If we apply the same concerns to another company, FedEx, then we should say that their freight customers should force FedEx to dump Custom Critical.
 

Darmstadter

Veteran Expediter
I would think that Landstar would at least get a last look at the load after all the bids are in and decide if they want to match the best bid. If they're smart they'll put a database together of all the bids that come in so they know what rates the market is bearing.
 

DougTravels

Not a Member
Believe what you want, they want the stuff moved. They do not care how it gets moved or who moves it. They are in the manufacturing business, not the freight business.

They want the stuff moved at the best price or they would be contracted through a carrier



The system and qualifications are not like eBay, they don't open the system to everyone who wants to bid.

Who said it was like Ebay? Ebay is open bids, NLM is blind bids



Actually the contract is with the shippers, negotiated with them for the rates and the fees.

Yes, but they go through this 3rd party(NLM) to get the best price from all shippers



Well first off I don't know if you know how Landstar works, it isn't like Express-1 or Panther, different puppy all together.

Second I don't see this as a problem because the contractors at landstar can refuse anything and it affects them to the point of dealing with that agent who offered the run. The agent system works very well in this case.



See Doug, the problem is that they can't do all of that. The logistics system that we have right now is not what it was four years ago. There is a lot more interaction between carriers that happens behind the scenes to cover the customer. There is more of a divergence of the industry now than ever before. Our experts have it all wrong, mainly because he doesn't get out of his comfort zone to try different things and he doesn't understand this is not just expediting anymore. We are bluring the lines between generalized freight and expediting. Landstar has something like 8500 trucks in their fleet but only less than 400 in the expediting part of the business, so if they can't cover something, it goes external. I doubt if there is a lot of NLM freight that will go to express drivers, seeing the agents already have access and it is a losing thing for a lot of people.



THEY DON'T CARE.

You act like this is the only place in the world to find freight.

THEY DON'T CARE!

They are concern with moving Product A from Plant B to Plant C cheaply at the same time NLM allowed them to off load the work in finding a carrier to do the work while maintaining their budgets. I doubt that they will do anything to rock the boat right now, they need NLM for the next few years in their condition.

Oh and the last thing you miss is that Landstar has been pushing the warehousing, which is counter to the JIT concepts and practices but still useful for the customer. If we apply the same concerns to another company, FedEx, then we should say that their freight customers should force FedEx to dump Custom Critical.

My point is that NLM customers do not want to be "Landstar customers" they want competition to keep their prices down.

They sign with NLM to get the best price from all carriers in NLM's network. I do see a problem with any one carrier controlling NLM.
 

DougTravels

Not a Member
From NLM's website

AllWays On Command Center
The virtual and physical hub of NLM.

When you call on NLM, we call on a world of technology to link you to the lowest price and best-quality service for freight shipments. By combining high technology with the expertise of NLM Logistics Specilaists, the AllWays On Command Center allows NLM to become a complete supply-chain management partner for your company.

The AllWays On Command Center also serves our entire organization, rounding out one of the industry’s most comprehensive source for supply chain services.

If Landstar abuses information to help themselves, that would hurt other carriers, It could put some out of business. If that happens then less competition would generally raise prices for shipments.

Their own claim of the lowest price for freight shipments would then be in conflict of Landstars commitment to their OO's to get the highest price for them.

You would have to be blind not to see potential for conflict of interest.

Contract with OO's and trying to negotiate the best price for them, while trying to get the lowest price for shippers.
 

fastman_1

Veteran Expediter
Owner/Operator
It was hypothetical thoughts there Greg, Don't read more than Into than what was written.
 

greg334

Veteran Expediter
Fastman, I heard the same comment made offsite and I threw it in here.

My point is that NLM customers do not want to be "Landstar customers" they want competition to keep their prices down.

They sign with NLM to get the best price from all carriers in NLM's network. I do see a problem with any one carrier controlling NLM.

Well Doug, it doesn't matter because there is no conflict of interest unless there is a change to exclusivity for the entire system and it's umpteen thousand vendors.

Who said this will turn the customers into Landstar only customers?

NLM has how many carrier members?

How many of them will not participate if there is somehting that jepordizes the relationship with the customer? I think most will leave and Landstar can't handle all of it.

The same goes for the customer, if they feel they are getting the shaft, then they will leave which will reduce the value of NLM to Landstar and make the investment worthless.

Now beside all of that, I wonder if you know about the exclusive partner agreements with NLM and other vendors, likeFedEx, Vascor, Penske and YRC?

There is also a question about FedEx who I think just signed an extension to their partner agreement with NLM to take it into 2010. What will happen to them? Will CC see a drop in work? I doubt it.

There are parts of this that indicate more of a move to help the former big three by mitigating their invientory risks.

If you want to discuss things with some facts outside of copy and paste off of their website, please go ahead but I think you need to learn (read) a bit more to understand how it actually works.
 

Turtle

Administrator
Staff member
Retired Expediter
Landstar bought a logistics company. Yawn.
 
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