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Speaker 1: Hello, and welcome to another episode of the Odd Lots podcast.

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Speaker 1: I'm Joe Wish and I'm Tracy Alloway. So, Tracy, this

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Speaker 1: is a special episode of the podcast that we actually

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Speaker 1: recorded at a recent conference. That's right. We recorded it

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Speaker 1: live at the Freight Waves Future of Supply Chain conference

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Speaker 1: in Northwest Arkansas. We got to meet a bunch of

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Speaker 1: people in the logistics and transport industry and really dive

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Speaker 1: into some of the topics that we've been covering for

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Speaker 1: the past year or two, exactly right. And so at

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Speaker 1: the conference, we recorded this episode live on stage with

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Speaker 1: the CEO of one of the fastest growing truck or

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Speaker 1: freight brokerages in America, Arrived Logistics. Yep. Here is our

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Speaker 1: interview with Matt Piott. He's the CEO of Arrive. We

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Speaker 1: hope you enjoy it all right. Hello, I'm a a

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Speaker 1: w Isn't and I'm Tracy Alloway. Yes. So we are

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Speaker 1: the co host of the Bloomberg Odd Lots podcast. We've

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Speaker 1: been doing it for a while. We cover all kinds

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Speaker 1: of things, markets, finance, and economics, and we're going to

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Speaker 1: record a live episode today. Yeah. Now, normally we do

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Speaker 1: cover finance and markets and economics. But over the past

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Speaker 1: couple of years, we've slowly transformed into supply chain correspondence

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Speaker 1: because everything that's going on with logistics and transport at

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Speaker 1: the moment has ended up having a really big impact

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Speaker 1: on the economy as well as markets. And so the

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Speaker 1: further we go into the supply chain, the more we

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Speaker 1: discover that we don't actually know, and we just go

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Speaker 1: deeper and deeper until we finally end up at conferences

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Speaker 1: like this exactly. So I'm really excited we're gonna be

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Speaker 1: speaking to the CEO of one of the fastest growing

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Speaker 1: freight brokerages in America. Found in twenty fourteen, nineteen hundred

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Speaker 1: employees raised a hundred million two point four billion of revenue.

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Speaker 1: Mat pie at the CEO of Arrived Logistics in Austin, Texas.

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Speaker 1: So Matt thrilled to be here with you. Thanks a

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Speaker 1: lot for having me things freight waves, and thanks to

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Speaker 1: you guys. I'm excited for the conversation. Don't give me

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Speaker 1: no heads up on how this is going to go,

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Speaker 1: so we'll see, we'll figure it out. We're just talking.

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Speaker 1: We're just chatting here, but you know, I want to

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Speaker 1: get into how the business works and what it takes

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Speaker 1: to be one of the fastest growing freight progers. But

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Speaker 1: before you in that, obviously lots of concerns about a

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Speaker 1: freight slowdown, a freight recession. We've read all the stories

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Speaker 1: and down freight waves. What's your sort of perch into

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Speaker 1: the industry right now and what's your view on what's

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Speaker 1: happening right now? Yeah, I mean, I'm sure this whole conference,

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Speaker 1: you know, the last couple of days has been around

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Speaker 1: what's going on in the market. Um, there's been a

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Speaker 1: lot of attention the media, you know, people making predictions,

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Speaker 1: especially freight waves. Um, you know where the market's heading.

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Speaker 1: You know, what we're seeing is absolutely what you're seeing

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Speaker 1: in the data. Um, those companies that have a high

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Speaker 1: exposure to contractual freight, they're continuing to take all that demand,

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Speaker 1: the freights not coming to the spot market. So the

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Speaker 1: spot market is getting more competitive. You saw that really

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Speaker 1: accelerate when the fuel prices kind jumped up to north

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Speaker 1: of five dollars a gallon. Um. You know, so when

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Speaker 1: that happened, not only were their contracts elevated, but then

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Speaker 1: you've got the elevated fuel surcharge, which made the contractual

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Speaker 1: freate even more advantageous for the asset based carres and

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Speaker 1: the brokers UM. And then you had a lot of

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Speaker 1: supply that entered the market over the last eighteen months.

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Speaker 1: You've heard about a lot of the new entrance, a

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Speaker 1: lot of owner operators obviously use equipment going um super

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Speaker 1: expensive these days. Insurance is high, fuel is high, so

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Speaker 1: you have the owner operators that are subjected to kind

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Speaker 1: of a higher fix or variable cost per mile UM

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Speaker 1: and that's really driving you know, a lot of competition

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Speaker 1: and spot market and ultimately, you know it will be

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Speaker 1: a really challenging market for any company, whether it's a

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Speaker 1: broker or an asset that is you know, thriving in

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Speaker 1: the spot environment. So UM. You know, really what we're

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Speaker 1: looking at is how do we balance our portfolio, you know,

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Speaker 1: how do we diversify modes of transportation? UM. But really

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Speaker 1: right now, contract is where you want to be in

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Speaker 1: Those that are in the contract market are thriving. Just

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Speaker 1: on the rates question, I mean, the debate seems to

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Speaker 1: be is the capacity issue, you know, lots of new

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Speaker 1: entrants into the market when spot rates were really high,

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Speaker 1: or does this reflect some sort of genuine slow down

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Speaker 1: in consumer demand? Can you give us like your gut

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Speaker 1: take on that issue. I mean, there's like a hundred

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Speaker 1: different data points that you can kind of follow, and

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Speaker 1: we look at all of them, and obviously you can

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Speaker 1: track all of them here as well. Um. Right now,

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Speaker 1: you're seeing consumer spending normalize, right, so you kind of

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Speaker 1: think about like a five year trend line. It's kind

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Speaker 1: of coming back down towards the more of a normal

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Speaker 1: um growth trajectory. Obviously spiked up in one when durable goods,

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Speaker 1: you know, spending increased. Obviously service spending was hammered by covid. Um,

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Speaker 1: you're starting to see a shift in the credit card

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Speaker 1: data back to the service industry. Um, but it's too

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Speaker 1: early to tell, right. So, I mean, you've got a

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Speaker 1: lot of where, a lot of inventory in the warehouses.

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Speaker 1: You've got a lot of pent up demand from people

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Speaker 1: that weren't able to get products over the last eighteen months.

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Speaker 1: You've got an economy that was doing pretty well that's

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Speaker 1: been challenged, you know, over the last you know, three

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Speaker 1: to six months. So it'll be really interesting if we

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Speaker 1: can get kind of the China supply chain under can

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Speaker 1: troll maybe some of the global conflict, um, you know,

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Speaker 1: maybe there's some saving it, but um as of now,

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Speaker 1: so he'll we understand what happens in an environment where

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Speaker 1: spot prices are rolling over and diesel prices are going

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Speaker 1: absolutely to the moon these days, made a capacity shortage?

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Speaker 1: How are carriers responding to? Which seems like an absolutely

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Speaker 1: brutal uh combination of events. You're gonna be a deflationary

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Speaker 1: market until we get to what we call equal librium

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Speaker 1: and equilibrium is when the rates have come down enough

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Speaker 1: that people start to exit the market. They're gonna exit

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Speaker 1: there right so right now, they're still making enough to

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Speaker 1: cover their costs, make a little bit of money, but

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Speaker 1: for how long who knows. I mean, obviously we've seen

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Speaker 1: one of the you know, historically fast decline of spot rates. UM,

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Speaker 1: so you'll continue to see that downward pressure on spot

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Speaker 1: rates until enough people either take the capacity off the

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Speaker 1: road or you know, demand picks back up enough to

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Speaker 1: offset and and drive some boiling back into the spot market.

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Speaker 1: How unusual is this market because one of the things

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Speaker 1: is that Joe and I here just walking around this conference,

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Speaker 1: is every once in a while you'll catch someone going

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Speaker 1: like nineteen and that's the parallel that it feels like

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Speaker 1: everyone reaches for it, but is it actually like that

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Speaker 1: or is it unique in some way? We talked about

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Speaker 1: the freight cycle constantly, and you know, you obviously know

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Speaker 1: that there's a three to five year period of time

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Speaker 1: where it goes inflationary, gets to the peak, comes to flationary,

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Speaker 1: gets back to equilibrium, and then typically there's some type

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Speaker 1: of shock, whether it's a pandemic or a natural disaster

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Speaker 1: or some type of you know, bad weather event in

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Speaker 1: a large part of the country that kind of sends it,

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Speaker 1: you know, back in the other direction. But what I

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Speaker 1: will say is we're we've gotten so elevated. You know,

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Speaker 1: if you look back to the highest spot rates got

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Speaker 1: where two oh four plus fuel. So today we're talking

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Speaker 1: about how rates have fallen extremely fasten there at two

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Speaker 1: to two oh four in that range plus fuel um.

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Speaker 1: So rates are still elevated above where they were in

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Speaker 1: the peak of eighteen. So you know what's really interesting is,

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Speaker 1: you know, how is the market going to react because

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Speaker 1: in through you know, we saw rates come from two

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Speaker 1: o four down to a dollar forty plus fuel um.

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Speaker 1: You know a lot of people think there's gonna be

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Speaker 1: a new bottom, so to speak, from a rate environment,

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Speaker 1: so we're we're definitely interested to watch because it is

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Speaker 1: very different than because of how high and how elevated

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Speaker 1: and how much demand we saw in So what do

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Speaker 1: we back up a little bit and talk about your

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Speaker 1: background and arrive and you start why, like, what did

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Speaker 1: you see as the opportunity that there was space for

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Speaker 1: what you wanted to build? Yeah, I wish I had

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Speaker 1: a really crazy story how we were going to just

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Speaker 1: take over the industry. But um, back in I was

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Speaker 1: working at another company called Command Transportation. I was super happy.

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Speaker 1: I was learning a lot. Um co founder and I

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Speaker 1: met in college Eric Dunnan, who's here. Um, we really

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Speaker 1: enjoyed the transportation market. And UM, we had a group

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Speaker 1: of friends that you know, own another health supplement business

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Speaker 1: and they were looking to make investments. So they reached

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Speaker 1: out and they're like, hey, we want to make investments

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Speaker 1: into startups, like we worked with you when you're in college.

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Speaker 1: And I was like, well, I know transportation, and you

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Speaker 1: guys have a five million dollar freight spend. So we

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Speaker 1: kind of with like this, Hey, we're going to manage

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Speaker 1: this shipper's transportation network, um, and then we're going to

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Speaker 1: grow from there. And so you know, things have really

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Speaker 1: rolled since we've had a lot of good momentum. Um.

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Speaker 1: The market has been in our favor a few different times. Um.

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Speaker 1: But yeah, we're we're really focusing on, you know what

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Speaker 1: the next five or seven years look like. What was

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Speaker 1: the attraction of freight brokerage Because Joe and I we've

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Speaker 1: joked on the podcast before that like we want to

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Speaker 1: start our own owner operator company. But actually having walked

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Speaker 1: around this conference, everyone's going, maybe maybe brokerage is the

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Speaker 1: place to be. I mean, like high profit margins, you

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Speaker 1: don't actually own that many assets. Well, correct me if

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Speaker 1: I'm wrong. Who has high profit margins? Maybe the assets

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Speaker 1: that have is someone lying to us? Yeah, that's I mean,

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Speaker 1: that's not accurate. I would say if you look back historically,

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Speaker 1: it's maybe been elevated. But with technology, all the investments

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Speaker 1: that we're making, we can talk about that for hours.

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Speaker 1: Obviously it's technology is deflationary to margins. We're trying to

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Speaker 1: eliminate as much cost of every single you know, transaction,

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Speaker 1: and that gets passed on. So if you look at

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Speaker 1: the big you know, the big companies that do like

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Speaker 1: North American Surface Transportation, Middle Mild trucking, I mean you're

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Speaker 1: at like twelve to fiftcent. Now, revenue per load moves up,

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Speaker 1: so the spread dollars are moving up um, but is

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Speaker 1: not sustainable. I mean it's too competitive market. There's too

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Speaker 1: much money entering the space. People are willing to take

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Speaker 1: the freight at a lower costs. I mean there's a

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Speaker 1: market clearing rate. Right. All of our shipper partners work

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Speaker 1: with twenty brokers or fifty brokers and assets, um. So

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Speaker 1: they're not paying us this huge premium to move the freight. Right,

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Speaker 1: we have to we have to charge a market rate

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Speaker 1: and then it's really on us from a prochairment standpoint

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Speaker 1: to drive margin. So before we came down here and

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Speaker 1: I was like telling people who we are going to

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Speaker 1: interview the CEO of a freight brokerage, people were like,

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Speaker 1: you know, who don't know anything about freight. They're like,

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Speaker 1: really there's brokers, Like why isn't it all just done

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Speaker 1: on an app? You know, like like ride hailing or something.

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Speaker 1: And obviously here there's been you know, tons of lots

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Speaker 1: of startups and lots of demos of technology. But you know,

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Speaker 1: when you go to the arrived website, a lot about

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Speaker 1: people this forced, etcetera. Talk to us about like your

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Speaker 1: view of like what is the um the sort of

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Speaker 1: the people element in building a successful brokerage. Yes, so

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Speaker 1: I think you've got two different ways to build a

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Speaker 1: successful freight brokerage. You can go out and raise a

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Speaker 1: lot of money and build great technology, and then you're

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Speaker 1: going to realize when the customers come to you and say,

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Speaker 1: well you need good operations, you're gonna go start hiring

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Speaker 1: a bunch of people to do the operations for the job.

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Speaker 1: And then there's you know, the other way of build

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Speaker 1: your operations and then build technology to you know, kind

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Speaker 1: of augment that. But at the end of the day,

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Speaker 1: a winner in this industry is going to have unbelievable technology,

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Speaker 1: unbelievable people. Right, it comes down to people, process and technology. UM.

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Speaker 1: So you know, we we obviously have gone out and

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Speaker 1: raise money over the last couple of years, and all

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Speaker 1: of our capital rays that we've done has been allocated

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Speaker 1: to technology development. We're spending about thirty million dollars a

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Speaker 1: year right now building you know, proprietary technology, two and

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Speaker 1: fifty full time engineers UM. And it's never enough, right,

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Speaker 1: There's it's an unlimited opportunity to know better, build better

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Speaker 1: connectivity UM. But we we are very big advocates that

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Speaker 1: the people are everything in this business, and we spend

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Speaker 1: so much time on not is talent acquisition, but on

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Speaker 1: talent management, talent retention UM. It's it's it's spent. So

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Speaker 1: I probably spend of my time with the executive team

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Speaker 1: talking about our people UM and then obviously the rest

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Speaker 1: of strategy and technology. But it is, it is the difference.

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Speaker 1: And at the end of the day where business services

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Speaker 1: people come to us because they want to move their

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Speaker 1: freight from point A to point B and they want

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Speaker 1: to do it with the least amount of friction as

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Speaker 1: possible UM, so that people are a big part of that.

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Speaker 1: Can you go into detail as much detail as possible

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Speaker 1: on why tech is important and why data is important

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Speaker 1: because I mean, for instance, we listen to Billy Being

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Speaker 1: yesterday on the stage from Moneyball, and I know you've

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Speaker 1: mentioned Moneyball as well as an inspiration behind your approach,

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Speaker 1: and I'm wondering, like, exactly how do numbers and technology

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Speaker 1: fit into the business model? Those are I can answer

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Speaker 1: two different questions there. One is how is Billy being

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Speaker 1: in money Ball relevant to our business model? And then

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Speaker 1: how is technology and I'll start with technology, and that

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Speaker 1: we can go to money that you want. UM. So

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Speaker 1: technology is everything. We look at technology and three different pillars.

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Speaker 1: You've got customer interactions. So basically, how are we connecting

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Speaker 1: to our customers. How do we make that a more

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Speaker 1: seamless transition. A large enterprise shipper has very different needs

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Speaker 1: and an SMB shipper, right, so we want to build

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Speaker 1: different technology. We want to have the ability to interact

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Speaker 1: with them differently. They care about different different metrics and

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Speaker 1: on time percentages and in different ways of getting quotes.

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Speaker 1: So it's all about how do we connect them and

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Speaker 1: make that experience seamless. And then the second of the

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Speaker 1: third pillar is around the carrier side. And we've heard

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Speaker 1: a lot about the apps and every you just asked,

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Speaker 1: why isn't it all automated? Well, if you could get

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Speaker 1: all five thousand plus carriers to use the same system,

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Speaker 1: it would be pretty easy to automate this industry. UM.

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Speaker 1: But I can tell you we've got carriers that refuse

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Speaker 1: to do anything but over the phone they want to.

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Speaker 1: Then we have carriers that only want to use our app.

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Speaker 1: We have carriers that only want to go onto a

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Speaker 1: web portal. UM. We have careers that want to use

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Speaker 1: g chat and Slack and all different different modes of communication.

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Speaker 1: So our technology is how do we connect with every

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Speaker 1: single one of our providers to drive the most efficient

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Speaker 1: connectivity between us and them. And then the third pillar

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Speaker 1: of technology and obviously very important to the future of

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Speaker 1: our industry is internal technology is how do we operate?

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Speaker 1: How do we make our operations more efficient? I think

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Speaker 1: like five years ago, ten years ago, they would tell

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Speaker 1: you three loads per day per head was like the

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Speaker 1: gold standard and transportation UM and that number is just

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Speaker 1: not sustainable. You've got to get your fixed costs down.

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Speaker 1: So you've got to build technology that augments what a

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Speaker 1: person can do. A person's job is to build relationships,

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Speaker 1: to problem solve, to proactively communicate, to build good relationships,

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Speaker 1: and to expand the business. The technology job is to

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Speaker 1: do everything else. Whether it's decisions, support, pricing, support UM,

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Speaker 1: whether it's matching the right carry of the right load

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Speaker 1: every single time. It's all about the different things that

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Speaker 1: we can do eternally that humans were typically doing and

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Speaker 1: we can take that part part out of the process,

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Speaker 1: and that allows us to have more transactions per day

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Speaker 1: per employee, which ultimately lowers our cost per employee, which

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Speaker 1: ultimately lowers the margin because we can go in more

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Speaker 1: competitive and drive more volume. Oh money money ball is

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Speaker 1: a longer question, but I'll answer as quickly as I can.

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Speaker 1: The one of the things that we've done that's really

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Speaker 1: really unique. It's like I that we started from like

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Speaker 1: an operational standpoint. We were all about building the best

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Speaker 1: operations that we could build. UM, so we didn't have

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Speaker 1: great technology at the beginning, but we perfected the art

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Speaker 1: of hiring, training, and retaining. And so we have five cohorts,

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Speaker 1: so we have new customer sales, new carrier sales new customer,

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Speaker 1: then within customers have SMB mid market and enterprise new carrier.

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Speaker 1: Then you have carrier based on wallet size, and then

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Speaker 1: you have corridor, which is od pair like origin destination,

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Speaker 1: city to city how often we're running it. So we

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Speaker 1: basically figured out all of the math behind every single

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Speaker 1: one of those core cohorts. We've never missed a monthly

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Speaker 1: projection from a low per day perspective. Our investment banks

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Speaker 1: actually told us we have the most predictable, defenseable financial

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Speaker 1: projections they've ever seen because it's detailed down to the

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Speaker 1: actual person's name, and then future hires are by cohorts, right,

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Speaker 1: so we know how many people to hire, what their

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Speaker 1: productivity is gonna be, what the turnovers and milk like,

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Speaker 1: what are retained accounts are going to be, what the

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Speaker 1: growth on those retained accounts are going to be, how

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Speaker 1: many people we need to hire to fill those orders

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Speaker 1: on the carrier side, how many people need to hire

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Speaker 1: on the operation site. So it's just one big financial

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Speaker 1: model that we've created. And the good thing about it

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Speaker 1: is every single month it gets better because every single

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Speaker 1: person is another data point. So month eighteen of person,

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Speaker 1: why is another data point for that, you know, eighteen

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Speaker 1: point tenure on the customer side of the business. So

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Speaker 1: it just continually gets better and better. Um. So that's

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Speaker 1: kind of the whole money ball approach and the predictability,

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Speaker 1: and then what we do is we overlake technology gains.

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Speaker 1: So it's like, Okay, on a baseline of a percent

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Speaker 1: magical achievement on the carrier side that was in April

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Speaker 1: of last year, we're now at a hundred and sixty

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Speaker 1: two percent, So it's a sixty two pc increase in

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Speaker 1: productivity across all ten year bands. So that's kind of

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Speaker 1: how we're underwriting our return on our investment because we

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Speaker 1: know what our cohorts were doing before, and we can

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Speaker 1: constantly monitor and see how they're improving each and every

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Speaker 1: quarter as we build more and more technology. So how

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Speaker 1: do you succeed as a broker or what do you

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Speaker 1: look for in the characteristics of someone who comes to

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Speaker 1: work for you and what do they have in them

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Speaker 1: that makes them thrive it arrive. If you had asked

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Speaker 1: me that five years ago, it is a very different answer.

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Speaker 1: I mean people today are very different coming out of college.

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Speaker 1: I mean, we'll hire eight hundred people this year and

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Speaker 1: seven hundred and fifty of them come out of college. Um,

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Speaker 1: So what I would tell you is we look at

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Speaker 1: it by role. So one of the things that we

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Speaker 1: talked about is higher train retained within hiring. We have profiled,

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Speaker 1: We looked at every single university, everything you can look at.

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Speaker 1: We know everything like where to go to get the

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Speaker 1: best talent for each every each and every role, whether

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Speaker 1: it's customer sales operations or carrier sales, because they're completely

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Speaker 1: different jobs. On the customer side, it's a little bit

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Speaker 1: longer of sales cycle, so it's you know, you're selling

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Speaker 1: into a transportation manager, someone that's probably got a four

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Speaker 1: year degree, someone that's you know, has a supply chain

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Speaker 1: UM major, So you're having to sell it a you know,

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Speaker 1: a different type of sales process. On the carrier side,

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Speaker 1: you're selling into With us, our core carriers have twelved

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Speaker 1: with a thousand trucks UM. We do some with the

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Speaker 1: smaller market, but we've built all of our technology and

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Speaker 1: our capability around the mid mid market fleet UM. So

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Speaker 1: you're talking to someone that you know is probably sitting

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Speaker 1: in an office that's managing their carrier, so you're trying

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Speaker 1: to build that relationship. And then operations, it's all about

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Speaker 1: proactive communication. It's all about customer service right the end

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Speaker 1: of the day. The operation people when when we shipped

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Speaker 1: for a big ship or they look at arrived based

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Speaker 1: on the experience that they have with their rep. That's

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Speaker 1: managing the day to day of that account. So it's

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Speaker 1: super imperative about you know, to hire and train people

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Speaker 1: to be like unbelievably good at that. You said it

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Speaker 1: used to be different. You said it used to be different.

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Speaker 1: What did it used to be like? Yeah, so our

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Speaker 1: company was a lot different five years ago. We didn't

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Speaker 1: zero contractual freight. It was all spot freight, and that

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Speaker 1: was how we got off the ground. It was just

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Speaker 1: you know, l f G like aggressive sales culture, run

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Speaker 1: through a wall, do it again, landed customer, grow a customer. UM.

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Speaker 1: So that was a different personality. Now we're in with

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Speaker 1: five thousand plus customers. It's all about expanding wallets share

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Speaker 1: within those customers. And yes, we're gonna continue to grow.

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Speaker 1: I mean we landed twenty three fortune accounts last quarter alone.

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Speaker 1: I only know that because my board beings on Thursday,

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Speaker 1: So it's it's one of the slides, um. But it's

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Speaker 1: really about like maturing as a business, building out unbelievable operations,

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Speaker 1: building out best in class technology. So it's just a

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Speaker 1: different profile people that are success. How do you manage

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Speaker 1: that culture change? Because in some respects it kind of

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Speaker 1: reminds me of what happened on Wall Street, right because

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Speaker 1: in the nineteen eighties, I mean even up until the

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Speaker 1: two thousand eight financial crisis, there's a certain type of

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Speaker 1: trader who was typically quite aggressive, quite competitive, very sales focus,

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Speaker 1: that sort of thing. And then in recent years technology

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Speaker 1: has come in and changed the market. It feels like

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Speaker 1: the requirements for what it takes to succeed have changed

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Speaker 1: quite a lot. So how do you manage that transition

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Speaker 1: from a people perspective? Yeah, I mean culture and engagement

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Speaker 1: is huge. We never even talked about talent management eight

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Speaker 1: seven years ago and we started the company, didn't even

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Speaker 1: know what that was. Um. We didn't have a single

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Speaker 1: person HR until we had a hundred and fifty employees, um.

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Speaker 1: And now it's it's a huge part of our our

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Speaker 1: differentiation strategy. So, UM, what I would say is, you know,

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Speaker 1: we've really focused on talent management. We really really focus

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Speaker 1: on how do we build people. The people that we're

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Speaker 1: getting today care about their career, They care about upward mobility,

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Speaker 1: They care about seeing the progression in job titles and

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Speaker 1: base salary is and earning opportunities and roles and responsibilities.

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Speaker 1: So we as an organization of how to kind of

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Speaker 1: take that aggressive sales culture and marry it with what

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Speaker 1: people are looking for today. And honestly, there's been turnover,

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Speaker 1: right like, and that's just part of scaling a business.

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Speaker 1: And you know, some people are able to adapt and

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Speaker 1: some people are part of able to join and be

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Speaker 1: a part of the kind of the new Ford, forward

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Speaker 1: looking momentum um, and then other people wanted to be

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Speaker 1: what it used to be a hud spot aggressive and

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Speaker 1: those people don't ultimately make it so um. But from

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Speaker 1: a culture standpoint, we try to, you know, appeal to

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Speaker 1: every single type of person. We still have really good

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Speaker 1: hungry salespeople, but we now have a lot of technology people,

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Speaker 1: and technology people look for a lot of different things

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Speaker 1: than a salesperson does. So like how we're involved in

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Speaker 1: the community, how we're doing career development, how we're going

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Speaker 1: and bringing speakers, and how we're doing you know extra

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Speaker 1: you know, happy hours for the salespeople because they love that,

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Speaker 1: you know, extracurricular or sports. So we're trying to do

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Speaker 1: everything to appeal to a bunch of different subsets of

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Speaker 1: the of the employee base, whereas before it's kind of

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Speaker 1: like one personality. Can we go back to the question

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Speaker 1: of like the limits to technology and the limit it's

430
00:20:00,200 --> 00:20:03,040
Speaker 1: two apps, and so like what are the things right

431
00:20:03,080 --> 00:20:07,359
Speaker 1: now in your business that's simply just you just can't

432
00:20:07,400 --> 00:20:09,480
Speaker 1: do it from a n app? And what is what

433
00:20:09,680 --> 00:20:14,320
Speaker 1: is the the the the employees the salesforce, like customer service,

434
00:20:14,359 --> 00:20:16,239
Speaker 1: like what do they pick up and what do they

435
00:20:16,280 --> 00:20:18,200
Speaker 1: do on a day to day basis that just can't

436
00:20:18,200 --> 00:20:23,640
Speaker 1: be done via technology. Yet, well, we move ruckles a day, um,

437
00:20:23,720 --> 00:20:26,800
Speaker 1: and we don't do anything on a nap, so I

438
00:20:26,800 --> 00:20:29,440
Speaker 1: guess a lot it can't be done on a website

439
00:20:29,520 --> 00:20:32,600
Speaker 1: or um. You know, there's obviously a lot at the

440
00:20:32,680 --> 00:20:35,399
Speaker 1: end of the day, you getting in front of customers,

441
00:20:35,600 --> 00:20:38,160
Speaker 1: getting in front of carriers, understanding what they're looking for.

442
00:20:38,600 --> 00:20:41,120
Speaker 1: There's every carrier as a hundred brokers calling them right.

443
00:20:41,240 --> 00:20:43,720
Speaker 1: So how do you differentiate? How do you build that relationship?

444
00:20:43,720 --> 00:20:45,640
Speaker 1: How do you offer them the right load every single time?

445
00:20:45,680 --> 00:20:47,840
Speaker 1: Because so many people can call it carry and be like, hey,

446
00:20:48,000 --> 00:20:51,119
Speaker 1: I know you want Dallas to St. Louis, but not

447
00:20:51,200 --> 00:20:52,840
Speaker 1: knowing they don't want a night delivery, not knowing they

448
00:20:52,840 --> 00:20:54,640
Speaker 1: don't want a certain commodity, not knowing that they don't

449
00:20:54,640 --> 00:20:57,000
Speaker 1: want a certain weight, not knowing they want the fifteen

450
00:20:57,040 --> 00:21:00,000
Speaker 1: different characteristics of every single load that's different and they're

451
00:21:00,040 --> 00:21:02,560
Speaker 1: actually more than fifteen, it's like forty. But you know,

452
00:21:02,720 --> 00:21:04,760
Speaker 1: it's really really focusing on how do you bring the

453
00:21:04,880 --> 00:21:07,520
Speaker 1: right opportunity every single one of your customers and carriers,

454
00:21:07,760 --> 00:21:09,120
Speaker 1: And that's really hard to do on an app. Now

455
00:21:09,119 --> 00:21:11,280
Speaker 1: we're trying to We're doing as much as we humanly can,

456
00:21:11,600 --> 00:21:13,920
Speaker 1: but that also obviously means that the customers need to

457
00:21:13,920 --> 00:21:15,720
Speaker 1: be integrated into the app and the carriers need to

458
00:21:15,720 --> 00:21:17,639
Speaker 1: be integrated into the app, and there's a lot of

459
00:21:17,640 --> 00:21:20,440
Speaker 1: pushback on that side as well. So we're automating as

460
00:21:20,520 --> 00:21:22,560
Speaker 1: much as we humanly can, as fast as we can

461
00:21:22,680 --> 00:21:25,760
Speaker 1: because we're obviously focusing on driving rep level productivity and

462
00:21:25,800 --> 00:21:28,720
Speaker 1: automation is the best way to do that. Um So,

463
00:21:28,840 --> 00:21:31,000
Speaker 1: you know, as the as in what you've seen though

464
00:21:31,040 --> 00:21:32,920
Speaker 1: is over the last you know, a couple of years,

465
00:21:32,920 --> 00:21:36,000
Speaker 1: the adoption of the technology is increased significantly across the

466
00:21:36,119 --> 00:21:38,800
Speaker 1: entire industry and it's and it's an amazing trend, especially

467
00:21:38,840 --> 00:21:40,639
Speaker 1: for the big companies here in the audience or in

468
00:21:40,640 --> 00:21:43,199
Speaker 1: the industry, because we're the ones that have the technology

469
00:21:43,240 --> 00:21:45,560
Speaker 1: that's you know, out there that's able to connect all

470
00:21:45,600 --> 00:21:47,720
Speaker 1: the parties to make it more efficient, to drive more

471
00:21:47,800 --> 00:21:51,200
Speaker 1: volume and then obviously increase profitability on our end and

472
00:21:51,320 --> 00:22:07,520
Speaker 1: for the shippers and carriers. As technology advances, how do

473
00:22:07,600 --> 00:22:12,040
Speaker 1: you maintain a balance between price and quality? Because it

474
00:22:12,119 --> 00:22:15,080
Speaker 1: feels like, you know, if I'm a potential customer and

475
00:22:15,119 --> 00:22:17,240
Speaker 1: I go on an app or a portal or whatever.

476
00:22:18,040 --> 00:22:21,320
Speaker 1: Like it feels like there might be a tendency just

477
00:22:21,400 --> 00:22:22,840
Speaker 1: to look at price and be like, who's going to

478
00:22:22,920 --> 00:22:25,159
Speaker 1: do this the cheapest right? And how do how do

479
00:22:25,280 --> 00:22:30,480
Speaker 1: they actually understand who is reliable as a service provider.

480
00:22:31,119 --> 00:22:34,000
Speaker 1: What I'll say is, and this can be an unpopular answer,

481
00:22:34,080 --> 00:22:36,440
Speaker 1: is if the load is already available on a load board,

482
00:22:36,480 --> 00:22:38,560
Speaker 1: we haven't done our job as a as a as

483
00:22:38,280 --> 00:22:40,840
Speaker 1: a business service company. We want them to call us

484
00:22:40,920 --> 00:22:42,760
Speaker 1: with all of their problems, with all of their needs,

485
00:22:42,800 --> 00:22:44,600
Speaker 1: asked us to help them out, and then we want

486
00:22:44,600 --> 00:22:50,640
Speaker 1: to convert that to contractual freight. Um, so repeat that question. Sorry,

487
00:22:50,640 --> 00:22:52,480
Speaker 1: I'm I guess the question is like, how do you

488
00:22:52,520 --> 00:22:55,920
Speaker 1: balance price versus quality and reliability? I mean, at the

489
00:22:56,000 --> 00:22:57,560
Speaker 1: end of the day, there's a market clearing price like

490
00:22:57,600 --> 00:23:00,040
Speaker 1: I said earlier, Um, there's not this magic ability. It

491
00:23:00,200 --> 00:23:02,840
Speaker 1: just charge an unlimited amount of money. Um. So really

492
00:23:02,840 --> 00:23:05,600
Speaker 1: it comes down to, hey, who is the person that

493
00:23:05,640 --> 00:23:07,119
Speaker 1: we know can get it done. A lot of these

494
00:23:07,119 --> 00:23:10,160
Speaker 1: shippers they actually look at pricing on an RFP. What's

495
00:23:10,280 --> 00:23:12,480
Speaker 1: with like a landed cost adjustment, which is like how

496
00:23:12,520 --> 00:23:14,720
Speaker 1: often did that carrier give out give back the load.

497
00:23:14,760 --> 00:23:17,040
Speaker 1: How much do they charge us in accessorials? You know

498
00:23:17,080 --> 00:23:19,800
Speaker 1: what did the late deliveries cost us? So really making

499
00:23:19,800 --> 00:23:22,159
Speaker 1: sure that you're focusing on best in class service will

500
00:23:22,200 --> 00:23:24,439
Speaker 1: allow you have a little bit more pricing power. But

501
00:23:24,560 --> 00:23:26,000
Speaker 1: at the end of the day, you know, it's a

502
00:23:26,040 --> 00:23:29,520
Speaker 1: competitive marketplace and there's twenty thousand brokers, there's five tho assets.

503
00:23:29,520 --> 00:23:32,159
Speaker 1: Everyone wants the business, everyone wants to grow UM. So

504
00:23:32,200 --> 00:23:33,760
Speaker 1: it really comes down to how do we build that

505
00:23:33,800 --> 00:23:35,440
Speaker 1: relationship and how do we get in front of them

506
00:23:35,440 --> 00:23:39,880
Speaker 1: and all for the best solution what UM Going back

507
00:23:39,920 --> 00:23:43,560
Speaker 1: to the macro environment, and one of these conversations has

508
00:23:43,600 --> 00:23:46,920
Speaker 1: been this gap between spot and contract rates and so

509
00:23:47,200 --> 00:23:49,600
Speaker 1: what do you see, like, how does that close and

510
00:23:49,600 --> 00:23:52,119
Speaker 1: in what direction? And how does that affect a business

511
00:23:52,200 --> 00:23:56,720
Speaker 1: right now? So how does that close? What you're gonna

512
00:23:56,720 --> 00:24:00,119
Speaker 1: see is every shipper right now is discussing internally what

513
00:24:00,200 --> 00:24:02,080
Speaker 1: to do about their contractual. You've got a lot of

514
00:24:02,080 --> 00:24:05,320
Speaker 1: shippers that moved to quarterly bids. So during COVID, a

515
00:24:05,320 --> 00:24:07,560
Speaker 1: lot of shippers started to do shorter bid time. So

516
00:24:07,600 --> 00:24:09,760
Speaker 1: all of those bids are gonna come to do the

517
00:24:09,760 --> 00:24:11,720
Speaker 1: prices are gonna come down, So you're gonna see margin

518
00:24:11,760 --> 00:24:14,440
Speaker 1: pressure on contractual freight, so that will pull it down.

519
00:24:14,640 --> 00:24:16,399
Speaker 1: Then you have the yearly bids that come to Then

520
00:24:16,440 --> 00:24:19,880
Speaker 1: you've got you shippers probably out there that are willing

521
00:24:19,920 --> 00:24:21,920
Speaker 1: to rebid their network for lower costs because they know

522
00:24:21,960 --> 00:24:24,959
Speaker 1: the spot markets lower than contractual market is. So what

523
00:24:24,960 --> 00:24:26,840
Speaker 1: you're gonna see is month over a month, over a

524
00:24:26,840 --> 00:24:29,640
Speaker 1: month over a month contractual pressure. So that's gonna bring

525
00:24:29,680 --> 00:24:32,119
Speaker 1: it down over time. But the question is how do

526
00:24:32,160 --> 00:24:35,640
Speaker 1: you get spot back above contract It's gonna take. I mean,

527
00:24:35,720 --> 00:24:38,880
Speaker 1: the delta is so big right now, it's it's gonna

528
00:24:38,880 --> 00:24:41,560
Speaker 1: be really interesting. It's gonna take a lot of capacity

529
00:24:41,640 --> 00:24:44,280
Speaker 1: leaving the market. Um, I don't see it happening because

530
00:24:44,280 --> 00:24:46,080
Speaker 1: of an increase in demand, because you've had such a

531
00:24:46,160 --> 00:24:49,120
Speaker 1: run endurable goods that I don't see that a being

532
00:24:49,119 --> 00:24:51,159
Speaker 1: this massive demand shock that moves it back in the

533
00:24:51,160 --> 00:24:53,199
Speaker 1: other direction. So it's gonna have to be a you know,

534
00:24:53,359 --> 00:24:56,760
Speaker 1: supply leaving the market over time bringing those lines together.

535
00:24:56,960 --> 00:24:59,440
Speaker 1: Contract moves back up once it finds the bottom, and

536
00:24:59,480 --> 00:25:01,520
Speaker 1: then sometime of a destruction will happen, it will move

537
00:25:01,520 --> 00:25:04,000
Speaker 1: it back in the other direction up, So it could

538
00:25:04,000 --> 00:25:06,120
Speaker 1: be a while I mean, but once again, we can't

539
00:25:06,119 --> 00:25:08,280
Speaker 1: accurately forecast you know, wind spots are going to come

540
00:25:08,280 --> 00:25:11,800
Speaker 1: back up because it's typically driven by something we can predict. So,

541
00:25:12,000 --> 00:25:14,840
Speaker 1: speaking of capacity leaving the market, I have a really

542
00:25:14,840 --> 00:25:17,439
Speaker 1: basic question that probably a lot of people in the

543
00:25:17,480 --> 00:25:19,719
Speaker 1: free industry will already know the answer to. But if

544
00:25:19,720 --> 00:25:23,040
Speaker 1: you could please humor me. You talk about market fragmentation, right,

545
00:25:23,040 --> 00:25:25,800
Speaker 1: and everyone's like, oh, thousands of brokers in the space.

546
00:25:26,480 --> 00:25:29,600
Speaker 1: Why is that? Why hasn't someone just come in and

547
00:25:29,680 --> 00:25:32,280
Speaker 1: started I know there's been a few who have started consolidating,

548
00:25:32,320 --> 00:25:35,040
Speaker 1: but like, why don't we see that kind of consolidation

549
00:25:35,040 --> 00:25:38,359
Speaker 1: in the market. Well, there's very low barriers to entry

550
00:25:38,560 --> 00:25:40,440
Speaker 1: right to start of brokerage, and it's getting a little

551
00:25:40,440 --> 00:25:42,560
Speaker 1: bit higher, you know, harder these days, but not not

552
00:25:42,560 --> 00:25:45,440
Speaker 1: not that much harder. So and then everyone that has assets,

553
00:25:45,480 --> 00:25:47,280
Speaker 1: they're like looking at their friends that have assets that

554
00:25:47,359 --> 00:25:49,480
Speaker 1: have a brokerage. So you've got a lot of people

555
00:25:49,480 --> 00:25:52,560
Speaker 1: that are starting brokerage. Is um So I just don't

556
00:25:52,600 --> 00:25:54,800
Speaker 1: see that trend stopping because there's an opportunity to make

557
00:25:54,840 --> 00:25:57,920
Speaker 1: incremental money off of their relationships. Um. Now you're starting

558
00:25:57,920 --> 00:26:00,000
Speaker 1: to see ship or start brokerages. You're starting to see

559
00:26:00,000 --> 00:26:01,760
Speaker 1: all sorts of different people try to find a way

560
00:26:01,800 --> 00:26:04,800
Speaker 1: to you know, have more predictable capacity, manage their costs

561
00:26:04,800 --> 00:26:08,880
Speaker 1: more efficiently, drive incremental growth UM. So you know, it's

562
00:26:08,920 --> 00:26:10,960
Speaker 1: it's a great question. Now. What you will see though,

563
00:26:11,160 --> 00:26:13,880
Speaker 1: is that the top ten to top twenty brokers are

564
00:26:13,880 --> 00:26:16,800
Speaker 1: taking significantly more of the market share. And that's a

565
00:26:16,880 --> 00:26:19,040
Speaker 1: function of like I said, it all comes down to

566
00:26:19,520 --> 00:26:23,320
Speaker 1: lower cost proload, better technology, and better service. And the

567
00:26:23,800 --> 00:26:26,160
Speaker 1: people that have large scale it allows them to take

568
00:26:26,200 --> 00:26:28,439
Speaker 1: that market up. You know that that market growth a

569
00:26:28,440 --> 00:26:31,919
Speaker 1: lot easier. Does technology factor into that as well? I

570
00:26:31,920 --> 00:26:34,560
Speaker 1: imagine you know, if technology becomes a more important part

571
00:26:34,560 --> 00:26:36,240
Speaker 1: of the business, you have to spend more and more

572
00:26:36,320 --> 00:26:39,159
Speaker 1: to develop it. It feels like those with access to

573
00:26:39,240 --> 00:26:42,359
Speaker 1: lots of capital will have a competitive advantage in a

574
00:26:42,400 --> 00:26:45,960
Speaker 1: way that you know that didn't necessarily happen before low

575
00:26:46,000 --> 00:26:50,080
Speaker 1: barriers to entry, as you mentioned, Yeah, that's you're already

576
00:26:50,080 --> 00:26:52,919
Speaker 1: seeing that. You're seeing the bigger getting bigger um and

577
00:26:52,960 --> 00:26:55,000
Speaker 1: you're seeing the smaller able to kind of they're going

578
00:26:55,040 --> 00:26:57,399
Speaker 1: after probably a much different subset of business. Right, So

579
00:26:57,440 --> 00:26:59,200
Speaker 1: there's there's a lot of fright out there, there's a

580
00:26:59,280 --> 00:27:01,920
Speaker 1: hundred thousand ship verse, so there's a lot of SMB

581
00:27:02,040 --> 00:27:03,960
Speaker 1: guys out there. There's a lot of small brokers that

582
00:27:04,000 --> 00:27:06,720
Speaker 1: can make a really great livelihood working on them. You know,

583
00:27:06,840 --> 00:27:08,840
Speaker 1: we're all fighting for the fortune one thousand. The ones

584
00:27:08,880 --> 00:27:10,560
Speaker 1: that can really drive a lot of scale, that can

585
00:27:10,600 --> 00:27:13,720
Speaker 1: really a lot because technology is useless without scale, which

586
00:27:13,760 --> 00:27:16,120
Speaker 1: is why all these companies are raising money to get

587
00:27:16,160 --> 00:27:17,879
Speaker 1: to scale, because that's a lot that gives you. The

588
00:27:17,960 --> 00:27:20,280
Speaker 1: more data every transaction allows you to offer more freight

589
00:27:20,280 --> 00:27:22,359
Speaker 1: to your carriers, which gets your carriers to be more

590
00:27:22,400 --> 00:27:25,440
Speaker 1: sticky within your network, which drives better service and better purchasing.

591
00:27:25,640 --> 00:27:28,840
Speaker 1: So just this huge flywheel. Um. So do I see

592
00:27:28,880 --> 00:27:32,600
Speaker 1: like consolidation continue to happen. Yeah, it's absolutely the large

593
00:27:32,600 --> 00:27:35,240
Speaker 1: players are gonna continue to take an outsized portion of

594
00:27:35,240 --> 00:27:37,600
Speaker 1: the market. Um, But there's definitely a place out there

595
00:27:37,640 --> 00:27:39,800
Speaker 1: for the smaller guys um to continue to exist and

596
00:27:39,840 --> 00:27:43,320
Speaker 1: be successful. And is that largely a function of the

597
00:27:43,359 --> 00:27:47,640
Speaker 1: fact that sitting said brokerage is just the shippers. There's

598
00:27:47,680 --> 00:27:50,480
Speaker 1: just so many different types of shippers and carriers that

599
00:27:50,520 --> 00:27:52,280
Speaker 1: there's just always going to be a need for lots

600
00:27:52,280 --> 00:27:55,800
Speaker 1: of different kinds of players to connect them. Fast forward

601
00:27:55,840 --> 00:27:59,240
Speaker 1: twenty thirty years, maybe there's more of a connected ecosystem.

602
00:27:59,359 --> 00:28:00,760
Speaker 1: You know. I think that you're starting to see that

603
00:28:00,800 --> 00:28:03,800
Speaker 1: already with the marketplaces. Um. You know what we're trying

604
00:28:03,840 --> 00:28:06,120
Speaker 1: to build from an automation of like we can give

605
00:28:06,160 --> 00:28:08,680
Speaker 1: a price on any loan on any lane at any

606
00:28:08,760 --> 00:28:11,480
Speaker 1: lead time in the country, and we're going to guarantee

607
00:28:11,480 --> 00:28:13,239
Speaker 1: that we're going to cover that. Now, the price might

608
00:28:13,280 --> 00:28:15,800
Speaker 1: not be great, right, um, but that's really what we're

609
00:28:15,800 --> 00:28:17,560
Speaker 1: trying to build is how do we build a marketplace

610
00:28:17,560 --> 00:28:20,159
Speaker 1: where all of our capacity is available for all of

611
00:28:20,200 --> 00:28:22,760
Speaker 1: our shippers. And and yes, I think what you'll see

612
00:28:22,800 --> 00:28:25,119
Speaker 1: over time is a small SMB shippers starting to use

613
00:28:25,119 --> 00:28:27,439
Speaker 1: more of the marketplaces, going on getting their own quotes,

614
00:28:27,560 --> 00:28:30,000
Speaker 1: and that will lead to like obviously the smaller, you know,

615
00:28:30,119 --> 00:28:32,560
Speaker 1: the less competitive, like their friend and you know that

616
00:28:32,640 --> 00:28:34,960
Speaker 1: lives next door, probably not being the best option for

617
00:28:35,000 --> 00:28:53,200
Speaker 1: them in the future. I have a slightly weird question,

618
00:28:53,240 --> 00:28:54,840
Speaker 1: but again, if you could just humor me. There is

619
00:28:54,880 --> 00:28:57,560
Speaker 1: an executive on this stage yesterday who was talking about

620
00:28:58,120 --> 00:29:01,840
Speaker 1: supply chain congestion and just general chaos that we've seen

621
00:29:01,960 --> 00:29:04,240
Speaker 1: over the past couple of years or so and talking

622
00:29:04,280 --> 00:29:09,160
Speaker 1: about the need for cooperation in the market. And when

623
00:29:09,200 --> 00:29:12,800
Speaker 1: I think freight brokerage, I don't necessarily think like combaya,

624
00:29:13,000 --> 00:29:16,200
Speaker 1: everyone's going to cooperate. I think like cut throughout competition,

625
00:29:16,920 --> 00:29:19,680
Speaker 1: everyone going after each other, winner takes all kind of thing.

626
00:29:20,280 --> 00:29:24,120
Speaker 1: Is there opportunity or space for working together to try

627
00:29:24,120 --> 00:29:26,280
Speaker 1: to make things more efficient? Yeah, I mean the supply

628
00:29:26,360 --> 00:29:28,480
Speaker 1: chains a lot there than what I what we play

629
00:29:28,600 --> 00:29:31,840
Speaker 1: and arrived as middle mile trucking right, full truckload middle

630
00:29:31,840 --> 00:29:34,840
Speaker 1: mile supply chains so much figger. You've got the international

631
00:29:34,880 --> 00:29:36,840
Speaker 1: company of the air component, you have the drage, you

632
00:29:36,880 --> 00:29:39,560
Speaker 1: have the warehouse, and you have the translating facilities. You've

633
00:29:39,560 --> 00:29:42,600
Speaker 1: got final mile middle mile lt L. So I definitely

634
00:29:42,600 --> 00:29:44,000
Speaker 1: think that you know, you're going to see a lot

635
00:29:44,080 --> 00:29:46,720
Speaker 1: more collaboration now. What you're seeing also is that the

636
00:29:46,760 --> 00:29:49,520
Speaker 1: big companies are buying those capabilities. I mean we've all

637
00:29:49,520 --> 00:29:52,240
Speaker 1: seen the big steamship lines and some of their acquisitions

638
00:29:52,240 --> 00:29:54,600
Speaker 1: they've made recently. Um, you know, so I think you're

639
00:29:54,640 --> 00:29:56,720
Speaker 1: going to continue to see where they're trying to make

640
00:29:56,720 --> 00:29:59,960
Speaker 1: it a steamless uh you know, seamless transaction for the ship,

641
00:30:00,040 --> 00:30:02,200
Speaker 1: or where they're getting one bill of lading UM, so

642
00:30:02,200 --> 00:30:04,240
Speaker 1: they're gonna partner with different parts of the supply chain

643
00:30:04,280 --> 00:30:06,000
Speaker 1: to be able to do that. So I definitely think

644
00:30:06,000 --> 00:30:07,520
Speaker 1: you're gonna confuse to see it. But I also think

645
00:30:07,520 --> 00:30:09,760
Speaker 1: you're going to see more acquisitions and kind of like

646
00:30:10,000 --> 00:30:12,280
Speaker 1: creations of companies that can do way more of the

647
00:30:12,280 --> 00:30:14,560
Speaker 1: supply chain instead of just being one, you know, one

648
00:30:14,600 --> 00:30:17,320
Speaker 1: part of it. And by bringing all that together, the

649
00:30:17,320 --> 00:30:22,200
Speaker 1: thesis would be better connectivity, cost savings, productivity, etcetera. Will

650
00:30:22,240 --> 00:30:25,680
Speaker 1: you be in a quarter. We just did our first

651
00:30:25,720 --> 00:30:29,040
Speaker 1: ever acquisition. It was a small one about you know,

652
00:30:29,120 --> 00:30:32,959
Speaker 1: thirty million of revenue, not of cost um And what

653
00:30:33,000 --> 00:30:36,040
Speaker 1: I would say is we're gonna be opportunistic, like we

654
00:30:36,040 --> 00:30:38,800
Speaker 1: we are really really good at middle mile trucking, Like

655
00:30:38,840 --> 00:30:40,760
Speaker 1: we love the middle mile. It's a huge space to

656
00:30:40,760 --> 00:30:43,440
Speaker 1: play in. And so we bought a cross border asset

657
00:30:43,920 --> 00:30:47,720
Speaker 1: UM and cross border is an awesome opportunity for us UM.

658
00:30:47,760 --> 00:30:50,040
Speaker 1: We've integrated the company over the last ninety days. We

659
00:30:50,120 --> 00:30:52,320
Speaker 1: just had the nine day update on Monday. Things are

660
00:30:52,320 --> 00:30:54,680
Speaker 1: going amazing. So that's been a good experience for our

661
00:30:54,720 --> 00:30:56,400
Speaker 1: executive team to learn how to do M and A

662
00:30:56,480 --> 00:30:58,760
Speaker 1: and to do a tuck in UM, and we've you know,

663
00:30:58,800 --> 00:31:01,120
Speaker 1: already put them into our all of our silos within

664
00:31:01,160 --> 00:31:03,280
Speaker 1: the organization. So that's been great. So we're going to

665
00:31:03,360 --> 00:31:05,560
Speaker 1: continue to look at some opportunities and then when we

666
00:31:05,600 --> 00:31:08,040
Speaker 1: look out five seven years, UM, there's a lot of

667
00:31:08,080 --> 00:31:10,360
Speaker 1: things that we're looking at, you know, large trailer pools,

668
00:31:10,480 --> 00:31:13,360
Speaker 1: things of that nature. Um. You know, shippers want assets,

669
00:31:13,440 --> 00:31:16,000
Speaker 1: they want the ability to have drop trailers on their yards.

670
00:31:16,000 --> 00:31:18,640
Speaker 1: I mean we do. You know, fifteen of our freight

671
00:31:18,720 --> 00:31:20,640
Speaker 1: is drop trailer, but it's not our trailers, it's our

672
00:31:20,640 --> 00:31:23,160
Speaker 1: partner carriers, right, So having the ability to have trailer

673
00:31:23,160 --> 00:31:26,960
Speaker 1: pools is a huge differentiator. What's the trailer This is

674
00:31:27,000 --> 00:31:30,160
Speaker 1: a backup, This is a outside of my knowledge. So

675
00:31:30,280 --> 00:31:33,840
Speaker 1: trailer pool is just the trailer, not not the truck.

676
00:31:34,280 --> 00:31:36,360
Speaker 1: So having extra trailers where you can drop those at

677
00:31:36,400 --> 00:31:38,480
Speaker 1: a big ship where they can load them with product

678
00:31:38,560 --> 00:31:40,280
Speaker 1: to go wherever you want, and you can move that

679
00:31:40,320 --> 00:31:42,520
Speaker 1: power only so you assign a truck driver to come

680
00:31:42,560 --> 00:31:44,239
Speaker 1: in and pick up your trailer and move it. And

681
00:31:44,320 --> 00:31:46,600
Speaker 1: what's the appeal of the cross border business. When you

682
00:31:46,640 --> 00:31:48,880
Speaker 1: said there's a big opportunity a cross border I mean

683
00:31:48,920 --> 00:31:51,040
Speaker 1: I think you're seeing a lot of you know, fragmentation

684
00:31:51,120 --> 00:31:54,320
Speaker 1: over in Asia, You've seeing a lot of different issues. So, um,

685
00:31:54,360 --> 00:31:55,960
Speaker 1: you know, whether or not I'm right, I don't know.

686
00:31:55,960 --> 00:31:57,600
Speaker 1: I would assume that Mexico is gonna be a big

687
00:31:57,640 --> 00:32:00,320
Speaker 1: winner over the next ten years. With that, they're already

688
00:32:00,360 --> 00:32:02,680
Speaker 1: one of our biggest trade partners. Um. So just the

689
00:32:02,680 --> 00:32:05,400
Speaker 1: amount of truckload freight that goes you know, north south

690
00:32:05,400 --> 00:32:08,720
Speaker 1: south north, um is absolutely huge and there's not that

691
00:32:08,760 --> 00:32:10,600
Speaker 1: many companies that are great at it right, So like

692
00:32:10,640 --> 00:32:13,239
Speaker 1: really trying to build a core competency where we're one

693
00:32:13,240 --> 00:32:15,400
Speaker 1: of the leading cross border companies is a huge niche

694
00:32:15,480 --> 00:32:17,760
Speaker 1: market for us. And the good thing is we already

695
00:32:17,760 --> 00:32:20,320
Speaker 1: have the customers and we already work with the carriers.

696
00:32:20,560 --> 00:32:23,040
Speaker 1: We move more than I think it's like two fifty

697
00:32:23,080 --> 00:32:25,960
Speaker 1: loads of day inbound Laredo, which all of that freights

698
00:32:26,040 --> 00:32:28,440
Speaker 1: ending up you know, most likely south of the border.

699
00:32:28,640 --> 00:32:30,560
Speaker 1: So it's like we already have the customers, were already

700
00:32:30,560 --> 00:32:32,840
Speaker 1: doing a lot of that transactions, Like how do we

701
00:32:32,880 --> 00:32:34,920
Speaker 1: just complete that and make it a more seamless experience

702
00:32:34,960 --> 00:32:38,440
Speaker 1: for our customers? So two questions based on that. But

703
00:32:38,560 --> 00:32:40,520
Speaker 1: we hear a lot of people talking about making their

704
00:32:40,520 --> 00:32:44,040
Speaker 1: supply chains more resilient, maybe moving some production and manufacturing

705
00:32:44,120 --> 00:32:47,640
Speaker 1: from places like China closer to home to avoid the

706
00:32:47,640 --> 00:32:49,920
Speaker 1: problems that we've seen for the past couple of years.

707
00:32:49,920 --> 00:32:52,280
Speaker 1: So one, do you think that's actually going to happen?

708
00:32:52,800 --> 00:32:55,480
Speaker 1: And then too, as a freight broker, how do you

709
00:32:55,520 --> 00:32:58,160
Speaker 1: actually position for that and do you start building up

710
00:32:58,200 --> 00:33:00,840
Speaker 1: that business now? It sounds like you are yeah, I mean,

711
00:33:01,960 --> 00:33:04,080
Speaker 1: are we did we see the peak of globalization? I

712
00:33:04,080 --> 00:33:06,400
Speaker 1: think is the question right? And I don't know the

713
00:33:06,440 --> 00:33:09,040
Speaker 1: answer to that. I don't think I have a crystal ball, um,

714
00:33:09,080 --> 00:33:11,320
Speaker 1: but I don't see that people don't get a little

715
00:33:11,320 --> 00:33:14,360
Speaker 1: bit more resilient and with some areas of the world

716
00:33:14,440 --> 00:33:17,280
Speaker 1: that might not have as much faith in long term UM.

717
00:33:17,320 --> 00:33:20,320
Speaker 1: So I don't see how people don't diversify their supply

718
00:33:20,400 --> 00:33:23,200
Speaker 1: chain a little bit over the coming years. Um. But

719
00:33:23,280 --> 00:33:25,280
Speaker 1: there's a huge cost of that, and we understand, you know,

720
00:33:25,320 --> 00:33:27,760
Speaker 1: there's there's a lot of infrastructure already set up in Asia,

721
00:33:27,800 --> 00:33:31,000
Speaker 1: and um, you know, it's a huge you know investment.

722
00:33:31,040 --> 00:33:33,280
Speaker 1: I mean, obviously you've seen intelmaking that one hundred billion

723
00:33:33,280 --> 00:33:36,200
Speaker 1: dollar commitment between a few different cities in America. So

724
00:33:36,240 --> 00:33:38,160
Speaker 1: I think you'll continue to see that. And as a

725
00:33:38,200 --> 00:33:41,200
Speaker 1: freight broker, it's great. We love when more manufacturing is

726
00:33:41,240 --> 00:33:43,360
Speaker 1: in America and North America, Canada or Mexico, you know,

727
00:33:43,400 --> 00:33:46,240
Speaker 1: in the North America. But um, you know, I think

728
00:33:46,240 --> 00:33:48,360
Speaker 1: that the way you prepare for that is you buy

729
00:33:48,400 --> 00:33:51,160
Speaker 1: those capabilities, you build those capabilities, you have the capacity,

730
00:33:51,560 --> 00:33:53,560
Speaker 1: um and so all that fraith that's moving in Asia

731
00:33:53,600 --> 00:33:55,800
Speaker 1: will hopefully come back to this part of the world,

732
00:33:55,840 --> 00:33:58,880
Speaker 1: and that's just going to increasely demand in our marketplace.

733
00:33:59,160 --> 00:34:00,600
Speaker 1: You know, some of that will go rail, some of

734
00:34:00,600 --> 00:34:03,280
Speaker 1: that will go you know us. So obviously, like the

735
00:34:03,360 --> 00:34:07,640
Speaker 1: last two years have been totally unprecedented for basically everyone

736
00:34:07,680 --> 00:34:10,280
Speaker 1: in the industry. And one of the questions of courses

737
00:34:10,360 --> 00:34:13,000
Speaker 1: will change the um, you know, the global geography of

738
00:34:13,000 --> 00:34:16,120
Speaker 1: supply chains. Are there any other things that you see

739
00:34:16,160 --> 00:34:19,439
Speaker 1: that happened in the last two years changing ways of

740
00:34:19,520 --> 00:34:22,920
Speaker 1: doing business in response to all the ups and downs

741
00:34:22,960 --> 00:34:27,120
Speaker 1: that will persist, uh post pandemic. That's going to permanently

742
00:34:27,120 --> 00:34:29,480
Speaker 1: sort of change the way this business operates. I mean,

743
00:34:29,480 --> 00:34:32,040
Speaker 1: you can make assumptions, right because you you would assume

744
00:34:32,239 --> 00:34:33,720
Speaker 1: you know, I think you saw a lot of companies

745
00:34:33,719 --> 00:34:36,359
Speaker 1: that ran really lean inventories. Now you're gonna say, are

746
00:34:36,360 --> 00:34:39,200
Speaker 1: they going to continue to run with inflated inventories? Um

747
00:34:39,320 --> 00:34:41,640
Speaker 1: for deployment of inventory? You know, how are they going

748
00:34:41,640 --> 00:34:43,759
Speaker 1: to continue to expand warehouse footprint? I mean, those are

749
00:34:43,800 --> 00:34:47,360
Speaker 1: all real expenses. And as we know that, you know,

750
00:34:47,719 --> 00:34:49,960
Speaker 1: we're all about driving, you know, as a public company,

751
00:34:50,000 --> 00:34:51,600
Speaker 1: not us, but as a lot of public companies, it's

752
00:34:51,600 --> 00:34:53,920
Speaker 1: all about the bottom line. And you know a lot

753
00:34:53,920 --> 00:34:56,240
Speaker 1: of those investments are expensive. So it will be interesting

754
00:34:56,239 --> 00:34:58,359
Speaker 1: to see how it plays out. I'm not gonna, you know,

755
00:34:58,680 --> 00:35:00,440
Speaker 1: take a guess out of my crystal all how many

756
00:35:00,440 --> 00:35:03,280
Speaker 1: of those things don't get reversed, but um, it'd be interesting.

757
00:35:03,320 --> 00:35:05,320
Speaker 1: It's gonna be interesting over the next couple of years.

758
00:35:05,360 --> 00:35:08,160
Speaker 1: So speaking of the past couple of years, I mean,

759
00:35:08,200 --> 00:35:10,719
Speaker 1: one of the things that's happened is that attention has

760
00:35:10,760 --> 00:35:14,640
Speaker 1: been focused on supply chains, possibly like never before. And

761
00:35:14,800 --> 00:35:17,360
Speaker 1: I know Craig Fuller from Freight Waves was making this

762
00:35:17,480 --> 00:35:20,800
Speaker 1: point yesterday, but he was basically saying that it's almost

763
00:35:20,920 --> 00:35:24,360
Speaker 1: like what you saw with fintech posts the two thousand

764
00:35:24,480 --> 00:35:28,840
Speaker 1: eight financial crisis. People saw what was broken in the system,

765
00:35:29,120 --> 00:35:32,239
Speaker 1: started talking about solutions to fixing it, and there was

766
00:35:32,320 --> 00:35:36,320
Speaker 1: lots of interest from the markets, so from venture capital,

767
00:35:36,560 --> 00:35:39,840
Speaker 1: private equity, just lots of money flowing into that space.

768
00:35:40,520 --> 00:35:44,120
Speaker 1: Is that something that you see potentially happening now? I

769
00:35:44,120 --> 00:35:46,239
Speaker 1: think it already has happened. In In fact, you can

770
00:35:46,239 --> 00:35:48,240
Speaker 1: find some pretty good information I think on freight waves

771
00:35:48,239 --> 00:35:51,320
Speaker 1: about how much capital has been deployed into the supply

772
00:35:51,400 --> 00:35:53,759
Speaker 1: chain industry over the last couple of years. Um. Do

773
00:35:53,800 --> 00:35:55,960
Speaker 1: I see it slowing down? No? I mean if you

774
00:35:56,000 --> 00:35:58,319
Speaker 1: even just look at the financial markets, I mean, there's

775
00:35:58,320 --> 00:36:00,560
Speaker 1: so much dry powder and private equity, whether it's going

776
00:36:00,560 --> 00:36:03,160
Speaker 1: to logistics or you know, fintech or whatever. There's just

777
00:36:03,160 --> 00:36:05,040
Speaker 1: so much liquidity out there in the market that needs

778
00:36:05,080 --> 00:36:08,719
Speaker 1: deployed into quality companies. And you know, in transportation there's

779
00:36:08,719 --> 00:36:11,480
Speaker 1: a huge opportunity. There's a lot of fragmentation. Investors love

780
00:36:11,560 --> 00:36:14,360
Speaker 1: big tams and this is probably one of the biggest

781
00:36:14,360 --> 00:36:17,319
Speaker 1: tams there are. Um, there's a lot of fragmentation. There

782
00:36:17,360 --> 00:36:19,160
Speaker 1: hasn't been a lot of technology until you know, the

783
00:36:19,239 --> 00:36:21,359
Speaker 1: last five to ten years. Um, So I do think

784
00:36:21,360 --> 00:36:23,040
Speaker 1: you're gonna continue to see a lot of companies that

785
00:36:23,080 --> 00:36:25,959
Speaker 1: have a thesis around, you know, consolidation, or supply chain

786
00:36:26,080 --> 00:36:29,120
Speaker 1: or software that supports the industry. I think one of

787
00:36:29,200 --> 00:36:31,600
Speaker 1: the most surprising things for me still and even hearing

788
00:36:31,600 --> 00:36:33,400
Speaker 1: you talk about like, oh, there are so many players

789
00:36:33,400 --> 00:36:35,680
Speaker 1: that just want to do by phone, and we've heard

790
00:36:35,680 --> 00:36:38,759
Speaker 1: the word facts machine multiple times over the last couple

791
00:36:38,760 --> 00:36:40,520
Speaker 1: of I don't know if that's still a thing. But

792
00:36:41,000 --> 00:36:44,000
Speaker 1: what is? Why is there still so much reluctance on

793
00:36:44,040 --> 00:36:46,399
Speaker 1: the part of some players to move on? And why

794
00:36:46,440 --> 00:36:49,000
Speaker 1: does why is there so much that's still done by

795
00:36:49,000 --> 00:36:53,480
Speaker 1: what feels like, you know, pretty ancient tech at this point. Yeah,

796
00:36:53,680 --> 00:36:56,680
Speaker 1: I mean it's a good question to ask to the

797
00:36:56,840 --> 00:36:59,359
Speaker 1: entire you know, marketplace. But what else is I grew

798
00:36:59,400 --> 00:37:00,640
Speaker 1: up in West virgin and so I grew up in

799
00:37:00,640 --> 00:37:03,040
Speaker 1: a tiny town in West Virginia. Our only claim to

800
00:37:03,080 --> 00:37:05,960
Speaker 1: fame was that DuPont poisoned our water. If you've seen

801
00:37:05,960 --> 00:37:08,560
Speaker 1: the movie Dark Waters. Um, that's our claim to fame.

802
00:37:09,040 --> 00:37:12,000
Speaker 1: But um, you know it's it's very blue collar, right,

803
00:37:12,040 --> 00:37:13,960
Speaker 1: So I grew up very blue collar, and this industry

804
00:37:13,960 --> 00:37:15,640
Speaker 1: is still very blue collar at the end of the day.

805
00:37:15,680 --> 00:37:19,200
Speaker 1: I mean transportation, trucking, warehousing, supply chains. It's a blue

806
00:37:19,200 --> 00:37:22,160
Speaker 1: collar industry. Um, so I think you definitely have some

807
00:37:22,200 --> 00:37:24,839
Speaker 1: hesitancy from technology. A lot of people, you know, don't

808
00:37:24,880 --> 00:37:27,000
Speaker 1: want to adopt it quite as much as they probably could.

809
00:37:27,000 --> 00:37:29,080
Speaker 1: But you are seeing the change, you are, You're definitely

810
00:37:29,080 --> 00:37:31,520
Speaker 1: seeing the change. We have so many of our carriers

811
00:37:31,520 --> 00:37:33,640
Speaker 1: that used to be adamant about oh just call me,

812
00:37:33,840 --> 00:37:35,400
Speaker 1: Now they don't even call us. They just go to

813
00:37:35,440 --> 00:37:37,200
Speaker 1: our portal and they book all their loads. So, like

814
00:37:37,440 --> 00:37:40,319
Speaker 1: I do, think you're seeing a changing landscape. Um, as

815
00:37:40,320 --> 00:37:42,719
Speaker 1: people see that it's more efficient, as as you know,

816
00:37:42,760 --> 00:37:45,400
Speaker 1: they see that their earnings can be increased, it makes them,

817
00:37:45,440 --> 00:37:47,400
Speaker 1: you know, have less employees to be able to manage

818
00:37:47,400 --> 00:37:49,920
Speaker 1: more of their fleets. So you know, technology is a

819
00:37:49,920 --> 00:37:52,520
Speaker 1: great thing for the entire I mean Donald Brown, who's

820
00:37:52,560 --> 00:37:54,560
Speaker 1: a big he talks a lot in this industry, and

821
00:37:54,719 --> 00:37:58,400
Speaker 1: he always says technology is deflationary by nature. Right, Technology,

822
00:37:58,400 --> 00:38:00,279
Speaker 1: whether it's in supply chain or in any part of

823
00:38:00,280 --> 00:38:02,359
Speaker 1: our our lives, is deflation area. It makes us more

824
00:38:02,400 --> 00:38:04,879
Speaker 1: effect efficient. As it gets better and better, it gets

825
00:38:04,960 --> 00:38:07,719
Speaker 1: cheaper and cheaper. So, um, you're gonna continue to see that.

826
00:38:08,320 --> 00:38:10,520
Speaker 1: So how do freight brokers actually make that up? Then?

827
00:38:10,560 --> 00:38:15,359
Speaker 1: Because when I think technology, I think price deflation transparency,

828
00:38:15,440 --> 00:38:18,279
Speaker 1: which like in general, might not be good for someone

829
00:38:18,360 --> 00:38:20,840
Speaker 1: taking a sort of like middleman position in the market.

830
00:38:21,160 --> 00:38:24,480
Speaker 1: So what happens to brokers and their margins in that scenario?

831
00:38:24,560 --> 00:38:26,600
Speaker 1: Do you try to make it up in scale? It's

832
00:38:26,640 --> 00:38:29,680
Speaker 1: all about scale, It's all about productivity. Now, look you

833
00:38:29,800 --> 00:38:32,280
Speaker 1: if you move specialized freight, there's there's a hundred different

834
00:38:32,320 --> 00:38:35,239
Speaker 1: niche you know, parts of the transportation market. Um. But

835
00:38:35,280 --> 00:38:37,200
Speaker 1: for for people like us with what we're trying to

836
00:38:37,239 --> 00:38:39,200
Speaker 1: accomplish and you know, getting to know being one of

837
00:38:39,239 --> 00:38:42,520
Speaker 1: the leading middle mild transportation providers in North America, it's

838
00:38:42,520 --> 00:38:46,319
Speaker 1: all scale and scale drives productivity. It's every single time

839
00:38:46,320 --> 00:38:47,719
Speaker 1: we pick up the phone and call acure that has

840
00:38:47,719 --> 00:38:49,960
Speaker 1: a hundred trucks, we have a hundred things off from right.

841
00:38:50,160 --> 00:38:51,760
Speaker 1: And you can't do that if you're moving a thousand

842
00:38:51,760 --> 00:38:54,600
Speaker 1: loads today, you just can't. Um. So really focusing on

843
00:38:54,719 --> 00:38:58,600
Speaker 1: you know, productivity, automation, getting that caught. I mean if

844
00:38:58,600 --> 00:39:01,640
Speaker 1: you look at I mean generally speaking, a cost pro

845
00:39:01,719 --> 00:39:03,960
Speaker 1: load in the industry might have been one fifty to

846
00:39:04,080 --> 00:39:07,120
Speaker 1: two depending on the size of the brokerage. I mean,

847
00:39:07,120 --> 00:39:09,120
Speaker 1: we're working to getting into a hundred and below, right,

848
00:39:09,120 --> 00:39:10,839
Speaker 1: So how do you make that cost pro load as

849
00:39:10,880 --> 00:39:13,560
Speaker 1: low as possible so that you can drive more transactions,

850
00:39:13,560 --> 00:39:15,480
Speaker 1: Because then you're gonna go and pass that savings along

851
00:39:15,640 --> 00:39:17,440
Speaker 1: and you're gonna get more and more business and it's

852
00:39:17,480 --> 00:39:19,680
Speaker 1: just going to continue to grow. So what's it day

853
00:39:19,719 --> 00:39:23,399
Speaker 1: like at the offices for me or for our employees? Well,

854
00:39:23,480 --> 00:39:26,480
Speaker 1: for if we were so we're walking around and I

855
00:39:26,520 --> 00:39:28,759
Speaker 1: want to do that sometime. I want to visit you problemably,

856
00:39:28,760 --> 00:39:31,319
Speaker 1: But he didn't come. I know, I we we never

857
00:39:31,360 --> 00:39:35,880
Speaker 1: made it, make it happen. At some point I flaked. No,

858
00:39:36,000 --> 00:39:40,560
Speaker 1: I got COVID that I didn't wanna. Yeah, well, what

859
00:39:40,560 --> 00:39:42,640
Speaker 1: what's the what's the vibe like? And what's the day

860
00:39:42,680 --> 00:39:45,920
Speaker 1: to day like for someone who's a broker or Yeah?

861
00:39:45,960 --> 00:39:48,120
Speaker 1: I mean we have so many different people that come.

862
00:39:48,200 --> 00:39:49,719
Speaker 1: And one of the things is we talked about a

863
00:39:49,719 --> 00:39:51,880
Speaker 1: lot today is the culture and the engagement and the

864
00:39:52,239 --> 00:39:55,040
Speaker 1: like all the employees. It is a lot of fun.

865
00:39:55,280 --> 00:39:59,000
Speaker 1: It is a fun, it's allowed, it's it's an outgoing atmosphere.

866
00:39:59,440 --> 00:40:01,680
Speaker 1: Um know, a lot of people think the office is dead,

867
00:40:02,040 --> 00:40:05,440
Speaker 1: and you know we're we're we're allowing for a lot

868
00:40:05,480 --> 00:40:07,839
Speaker 1: more flexibility than we ever thought. We would people have

869
00:40:07,880 --> 00:40:09,720
Speaker 1: a couple of days a week that they can work remotely,

870
00:40:09,719 --> 00:40:11,600
Speaker 1: and then as they get more and more experienced, they

871
00:40:11,600 --> 00:40:14,520
Speaker 1: have even more flexibility. But all of our top performers

872
00:40:14,520 --> 00:40:16,800
Speaker 1: still come to the office every single day. It's it's

873
00:40:16,840 --> 00:40:19,360
Speaker 1: it's such an environment that makes people want to be successful,

874
00:40:19,480 --> 00:40:21,600
Speaker 1: drives them forward. And if you think about what we're

875
00:40:21,600 --> 00:40:23,880
Speaker 1: doing is it's a team sport. You've got customer sales,

876
00:40:23,920 --> 00:40:26,760
Speaker 1: operations and carrier sales right and they're all working together

877
00:40:26,760 --> 00:40:30,480
Speaker 1: to effectively, you know, deliver the load on time. So

878
00:40:30,640 --> 00:40:33,279
Speaker 1: it's so much more effective, it's so much more fun

879
00:40:33,320 --> 00:40:36,160
Speaker 1: when you're working with your peers. Um, so when you

880
00:40:36,200 --> 00:40:38,680
Speaker 1: walk into our office, every single person says, the buzzes

881
00:40:38,840 --> 00:40:42,520
Speaker 1: is awesome? Is it still? Is it like open outcry?

882
00:40:42,600 --> 00:40:45,720
Speaker 1: Like are people calling out you know, loads on offer

883
00:40:45,960 --> 00:40:48,640
Speaker 1: and prices? It depends, Yeah, I mean but our office,

884
00:40:48,680 --> 00:40:50,239
Speaker 1: I mean we've got like a hundred and sixty thousand

885
00:40:50,280 --> 00:40:52,600
Speaker 1: square feed in Austin, so it's really hard to screen that,

886
00:40:52,640 --> 00:40:55,399
Speaker 1: you know across the office. But um, you're working. Really

887
00:40:55,400 --> 00:40:56,839
Speaker 1: what we do is we do it in pods. So

888
00:40:56,880 --> 00:41:00,439
Speaker 1: it's like sales team and OPS team, procurement team. We're

889
00:41:00,440 --> 00:41:02,399
Speaker 1: constantly moving around and letting them get to know other

890
00:41:02,400 --> 00:41:04,600
Speaker 1: people because you really only are interacting with the people

891
00:41:04,600 --> 00:41:06,319
Speaker 1: in that area of the office that you're act is

892
00:41:06,400 --> 00:41:09,080
Speaker 1: just so big. Um. But yeah, we do a pretty

893
00:41:09,080 --> 00:41:11,000
Speaker 1: good job of trying to move people around, and so

894
00:41:11,160 --> 00:41:13,240
Speaker 1: you're dealing with a lot of like interaction on Slack,

895
00:41:13,320 --> 00:41:15,640
Speaker 1: but then you're talking to people you know throughout wears

896
00:41:15,680 --> 00:41:18,759
Speaker 1: at home. Your interaction is very limited and and the

897
00:41:18,800 --> 00:41:21,840
Speaker 1: problem is is our industry you need real time, you know,

898
00:41:21,880 --> 00:41:23,480
Speaker 1: decisions like do you want to do this or not?

899
00:41:23,640 --> 00:41:25,560
Speaker 1: And then if you have to send someone to Slack

900
00:41:25,560 --> 00:41:27,080
Speaker 1: and they don't get back to you for seven minutes,

901
00:41:27,280 --> 00:41:30,400
Speaker 1: it's too late. So um, productivity we've seen in the

902
00:41:30,440 --> 00:41:33,839
Speaker 1: office is is significantly better. So what are the other

903
00:41:34,000 --> 00:41:37,359
Speaker 1: areas that you're excited about? We talked a little bit

904
00:41:37,400 --> 00:41:41,200
Speaker 1: about the cross border opportunity, Like what other areas of

905
00:41:41,239 --> 00:41:44,239
Speaker 1: the market do you see yourself going into. Yeah, so

906
00:41:44,280 --> 00:41:46,720
Speaker 1: I think that if you there's four or five different

907
00:41:46,719 --> 00:41:50,520
Speaker 1: ones we're looking at first and foremost drage. It's it's

908
00:41:50,560 --> 00:41:52,560
Speaker 1: the next kind of obvious step for us. We already

909
00:41:52,560 --> 00:41:54,480
Speaker 1: have the carriers, we already have the customers. It's just

910
00:41:54,800 --> 00:41:57,520
Speaker 1: you know, different understanding of how to move it UM.

911
00:41:57,560 --> 00:42:00,480
Speaker 1: So we're looking at that UM lt LS something that

912
00:42:00,480 --> 00:42:02,960
Speaker 1: we've been focusing on over the last twelve months. Not

913
00:42:03,400 --> 00:42:05,360
Speaker 1: you know, we haven't grown that as quickly as we like,

914
00:42:05,400 --> 00:42:07,080
Speaker 1: but something that we're going to continue to be you know,

915
00:42:07,160 --> 00:42:10,560
Speaker 1: watching UM cross border Mexico is one. Now we're going

916
00:42:10,600 --> 00:42:14,359
Speaker 1: cross border Canada UM. You know, freight management something that

917
00:42:14,360 --> 00:42:17,120
Speaker 1: we constantly hear about UM, but we kind of you know,

918
00:42:17,160 --> 00:42:18,880
Speaker 1: if we get into that, that would be more around

919
00:42:18,880 --> 00:42:22,280
Speaker 1: building a software for SMB shippers, for mid market shippers

920
00:42:22,480 --> 00:42:25,239
Speaker 1: to give them, you know, a procurement system a TMS

921
00:42:25,280 --> 00:42:27,680
Speaker 1: for them to be more efficient to try to capitalize

922
00:42:27,680 --> 00:42:30,160
Speaker 1: and take wallet chair UM that way. So those are

923
00:42:30,160 --> 00:42:32,200
Speaker 1: some of the different areas of the supply chain that

924
00:42:32,200 --> 00:42:34,560
Speaker 1: we're looking at. Getting into this reminds me of something

925
00:42:34,560 --> 00:42:36,399
Speaker 1: I want to ask you, which is how much does

926
00:42:36,520 --> 00:42:41,000
Speaker 1: customers segmentation matter in this market? Because my understanding is

927
00:42:41,040 --> 00:42:45,200
Speaker 1: that you tend to target mid sized firms versus like

928
00:42:45,400 --> 00:42:50,920
Speaker 1: individual drivers or owner operators, carriers or customers either we'll

929
00:42:50,960 --> 00:42:53,400
Speaker 1: go both, all right, So from like a customer standpoint,

930
00:42:53,440 --> 00:42:55,720
Speaker 1: like I said, we were very SMB small medium business

931
00:42:56,200 --> 00:43:00,200
Speaker 1: UM and now six of our revenue in one and

932
00:43:00,480 --> 00:43:03,319
Speaker 1: like sixty seven two is gonna be enterprise, so a

933
00:43:03,360 --> 00:43:06,640
Speaker 1: billionaire above and by seven that will probably be eight.

934
00:43:07,239 --> 00:43:09,880
Speaker 1: So those are the companies where you can really get scale.

935
00:43:09,920 --> 00:43:12,120
Speaker 1: They have consistency, We're able to come in and offer

936
00:43:12,160 --> 00:43:14,600
Speaker 1: them a service. UM, We're able to connect to them

937
00:43:14,600 --> 00:43:17,719
Speaker 1: with our technology UM. And so that that's really where

938
00:43:17,719 --> 00:43:19,760
Speaker 1: our growth will continue to be. On the shipper side,

939
00:43:19,960 --> 00:43:24,120
Speaker 1: will continue to build technology and products for the SMB market. UM.

940
00:43:24,160 --> 00:43:26,600
Speaker 1: But it's a it's a much higher attrition of the customer.

941
00:43:26,600 --> 00:43:29,239
Speaker 1: I mean our board meanings on Thursday or elso I

942
00:43:29,280 --> 00:43:31,880
Speaker 1: wouldn't know this stack. But we had zero percent turnover

943
00:43:32,160 --> 00:43:34,080
Speaker 1: and a customer that gave us ten or more loads

944
00:43:34,120 --> 00:43:36,359
Speaker 1: last year, so the customer gave us ten loads a day.

945
00:43:36,719 --> 00:43:38,880
Speaker 1: We lost zero of those customers year over year, and

946
00:43:38,920 --> 00:43:40,640
Speaker 1: we double the number of customers that gave us ten

947
00:43:40,680 --> 00:43:43,000
Speaker 1: or more loads year over year. And about eighty percent

948
00:43:43,040 --> 00:43:45,319
Speaker 1: of our growth scheam from those customers that gave us

949
00:43:45,320 --> 00:43:48,359
Speaker 1: center more loads. So, UM, we don't lose customers once

950
00:43:48,400 --> 00:43:49,800
Speaker 1: we get in the door with them, we service, and

951
00:43:49,880 --> 00:43:51,959
Speaker 1: we build teams around and we build around the clock

952
00:43:52,000 --> 00:43:55,200
Speaker 1: support for them um. And then on the SMB side,

953
00:43:55,239 --> 00:43:56,759
Speaker 1: it's just a lot more of a turn. You know,

954
00:43:56,800 --> 00:43:58,960
Speaker 1: they're they're a little more price sensit. They're gonna go

955
00:43:59,000 --> 00:44:00,600
Speaker 1: to a few different portals, So we're gonna build the

956
00:44:00,600 --> 00:44:02,120
Speaker 1: technology for them, but that's not going to be the

957
00:44:02,120 --> 00:44:04,279
Speaker 1: growth engine of our company. UM. And then on the

958
00:44:04,320 --> 00:44:07,360
Speaker 1: carrier side, you know, we we love the twelve thousand

959
00:44:07,400 --> 00:44:09,359
Speaker 1: truck carrier. I mean a lot of people always say

960
00:44:09,360 --> 00:44:12,400
Speaker 1: well nine of carriers or under six trucks or something

961
00:44:12,440 --> 00:44:14,960
Speaker 1: like that as the stat but it's only the trucks

962
00:44:14,960 --> 00:44:17,319
Speaker 1: on the highway. So we are really focusing on the

963
00:44:17,360 --> 00:44:19,640
Speaker 1: sixty percent of the trucks that fall between the twelve

964
00:44:19,680 --> 00:44:22,279
Speaker 1: and a thousand Because our shippers don't need us to

965
00:44:22,360 --> 00:44:24,719
Speaker 1: have a relationship with the mega fleets. They already have

966
00:44:24,760 --> 00:44:27,080
Speaker 1: a relationship with the mega fleets. You know, they're really

967
00:44:27,080 --> 00:44:29,360
Speaker 1: looking at us as a way to aggregate that capacity.

968
00:44:29,360 --> 00:44:32,000
Speaker 1: On the twelve thousand truck. They can do drop trailer,

969
00:44:32,040 --> 00:44:35,279
Speaker 1: they have more capacity. We can really build corridors. So

970
00:44:35,320 --> 00:44:37,600
Speaker 1: our entire business is how do we build lane level

971
00:44:37,680 --> 00:44:40,400
Speaker 1: corridors And that's really really challenging to do with a

972
00:44:40,440 --> 00:44:42,759
Speaker 1: smaller fleet. Smaller fleet is still going to be called

973
00:44:42,840 --> 00:44:45,600
Speaker 1: ten percent of our business um, but over time, we're

974
00:44:45,600 --> 00:44:48,160
Speaker 1: continuing to really focus on building that consistency so that

975
00:44:48,160 --> 00:44:50,080
Speaker 1: when we go to a carrier, they know that we're

976
00:44:50,080 --> 00:44:51,799
Speaker 1: gonna give them what they need each and every time.

977
00:44:52,040 --> 00:44:54,120
Speaker 1: These might be sort of a naive question, but you

978
00:44:54,160 --> 00:44:58,759
Speaker 1: mentioned SMBs. Perhaps look at multiple portals. How wide can

979
00:44:58,840 --> 00:45:02,280
Speaker 1: this spread be? You know, get a quote for lane

980
00:45:02,400 --> 00:45:04,839
Speaker 1: Dallas to l A, Dellas to Juliet or something. How

981
00:45:04,920 --> 00:45:07,520
Speaker 1: wide can the potential price difference vide? Yeah, so I'll

982
00:45:07,560 --> 00:45:10,359
Speaker 1: just I know Freightways has a pricing tool, but I'm

983
00:45:10,400 --> 00:45:12,840
Speaker 1: gonna reference one of their competitors is you know, D

984
00:45:12,920 --> 00:45:15,200
Speaker 1: A T has got a pricing tool, and on there

985
00:45:15,280 --> 00:45:17,680
Speaker 1: you can see shipper to broker or sorry, shipper to

986
00:45:17,760 --> 00:45:21,040
Speaker 1: carrier rates, and then you can see broker tow carrier rates.

987
00:45:21,239 --> 00:45:23,800
Speaker 1: And there's a twenty band of fifty band and a

988
00:45:23,880 --> 00:45:27,279
Speaker 1: seventy five man and that delta can be really significant.

989
00:45:27,280 --> 00:45:29,520
Speaker 1: I mean, depending on the lane and how volatile it is.

990
00:45:29,760 --> 00:45:32,000
Speaker 1: Let's just make up a lane l A to the

991
00:45:32,040 --> 00:45:35,640
Speaker 1: Midwest and Q four during peak retail season, you might

992
00:45:35,840 --> 00:45:38,160
Speaker 1: the best broker might be paying. I'm just making it

993
00:45:38,239 --> 00:45:41,040
Speaker 1: up two dollars a mile, but there's the top quartiles

994
00:45:41,040 --> 00:45:43,960
Speaker 1: paying three fifty a mile, so across that many miles

995
00:45:44,000 --> 00:45:46,480
Speaker 1: there's huge delta's right, And it all comes down to

996
00:45:46,560 --> 00:45:49,560
Speaker 1: your personal network as a transportation provider. Like that's what

997
00:45:49,680 --> 00:45:51,880
Speaker 1: we talked about our corridors. We have to know where

998
00:45:51,880 --> 00:45:54,600
Speaker 1: our capacity is, what our capacity costs, so that we

999
00:45:54,600 --> 00:45:57,600
Speaker 1: can offer that capacity to our our shippers in real time.

1000
00:45:57,640 --> 00:46:00,480
Speaker 1: That's where the technology comes in. So not you know,

1001
00:46:00,840 --> 00:46:02,600
Speaker 1: there's a lot of really good brokers out there that

1002
00:46:02,640 --> 00:46:04,480
Speaker 1: are really great at specific parts of the country, but

1003
00:46:04,480 --> 00:46:06,239
Speaker 1: they're not great at other parts of the country. They

1004
00:46:06,280 --> 00:46:08,239
Speaker 1: don't have the density and the consistency to build that

1005
00:46:08,320 --> 00:46:11,319
Speaker 1: carrier base. So really focusing like there's gonna be So

1006
00:46:11,320 --> 00:46:14,480
Speaker 1: that's why having multiple providers is the prudent thing to do,

1007
00:46:14,719 --> 00:46:17,600
Speaker 1: because not everyone can be the best at everything. This

1008
00:46:17,640 --> 00:46:20,160
Speaker 1: is actually something I want to ask about pricing data

1009
00:46:20,280 --> 00:46:22,640
Speaker 1: as well. So Joe and I were playing around with

1010
00:46:22,680 --> 00:46:24,840
Speaker 1: the Freight Waves product yesterday and I was trying to

1011
00:46:24,880 --> 00:46:27,439
Speaker 1: see how much we could earn driving a truck from

1012
00:46:27,719 --> 00:46:30,200
Speaker 1: Rogers back to New York, and I think it said

1013
00:46:30,239 --> 00:46:33,920
Speaker 1: something like almost five thousand dollars but like, obviously I

1014
00:46:33,960 --> 00:46:37,239
Speaker 1: have no idea that's expensive drive. Well, you know we're

1015
00:46:37,280 --> 00:46:40,680
Speaker 1: worth it obviously with all our experience. But the thing

1016
00:46:40,719 --> 00:46:44,000
Speaker 1: I want to ask is, like a how realistic is

1017
00:46:44,040 --> 00:46:46,360
Speaker 1: that pricing data? Like when someone calls you up with

1018
00:46:46,360 --> 00:46:49,720
Speaker 1: a quote, are you actually going to get that rate?

1019
00:46:50,040 --> 00:46:53,560
Speaker 1: Or like can it vary um between like when you

1020
00:46:53,560 --> 00:46:56,520
Speaker 1: actually undertake the trip or not so on the shipper

1021
00:46:56,560 --> 00:47:00,640
Speaker 1: side of the carry side again either Okay, sorry, I'm

1022
00:47:00,640 --> 00:47:03,240
Speaker 1: trying to not to be detailed, but m beaus detailed

1023
00:47:03,239 --> 00:47:06,839
Speaker 1: as you want. Okay, so please let's just talk about

1024
00:47:06,840 --> 00:47:09,399
Speaker 1: from the carrier side the carrier side, depending on the fleet.

1025
00:47:09,440 --> 00:47:11,840
Speaker 1: So if you're dealing with a cure, that's probably what

1026
00:47:11,840 --> 00:47:14,600
Speaker 1: I would consider driver dispatch. They're using all the tools,

1027
00:47:14,640 --> 00:47:16,480
Speaker 1: are using truck stop and d A T and free

1028
00:47:16,480 --> 00:47:18,440
Speaker 1: waves to get all of the market and information. So

1029
00:47:18,480 --> 00:47:20,360
Speaker 1: every time they put an offer in, it's gonna be

1030
00:47:20,400 --> 00:47:22,359
Speaker 1: at market or above rate for the most part, right

1031
00:47:22,520 --> 00:47:25,120
Speaker 1: unless they really need to get to somewhere. When you

1032
00:47:25,160 --> 00:47:27,279
Speaker 1: think about what we're trying to build us and I

1033
00:47:27,320 --> 00:47:28,960
Speaker 1: know everyone says the back hall is dead, but when

1034
00:47:28,960 --> 00:47:30,840
Speaker 1: you've got a thousand trucks or a hundred trucks or

1035
00:47:30,880 --> 00:47:33,439
Speaker 1: five hundred trucks, you still have empty miles. Really trying

1036
00:47:33,480 --> 00:47:35,680
Speaker 1: to find the right load for that carry every single time.

1037
00:47:35,920 --> 00:47:37,160
Speaker 1: You know, they're not going to try to get the

1038
00:47:37,200 --> 00:47:39,400
Speaker 1: market rate. If it fits exactly what they're looking for,

1039
00:47:39,440 --> 00:47:41,920
Speaker 1: they might give you a seven percent discount to the market,

1040
00:47:41,960 --> 00:47:43,399
Speaker 1: or they might give you a ten percent or four

1041
00:47:43,440 --> 00:47:46,720
Speaker 1: percent um. So really finding that perfect load is an

1042
00:47:46,760 --> 00:47:50,040
Speaker 1: integral part of driving margins from the procurement standpoint and

1043
00:47:50,080 --> 00:47:53,120
Speaker 1: then from the customer standpoint, you know, to the question earlier,

1044
00:47:53,200 --> 00:47:55,400
Speaker 1: like it just depends on the cut. Like let's just

1045
00:47:55,480 --> 00:47:59,040
Speaker 1: use a arrive as an example. Dallas So Laredo UM

1046
00:47:59,080 --> 00:48:01,040
Speaker 1: one of the highest volume lanes that we have. We

1047
00:48:01,160 --> 00:48:03,319
Speaker 1: used to pay seven hundred on that lane, and so

1048
00:48:03,360 --> 00:48:05,160
Speaker 1: we would have quoted all of that cost. But now

1049
00:48:05,200 --> 00:48:07,759
Speaker 1: that we run that so much, our cost is now

1050
00:48:07,800 --> 00:48:09,720
Speaker 1: at six hundred, so we're quoting off of a completely

1051
00:48:09,760 --> 00:48:12,280
Speaker 1: different number. Whereas a company that doesn't run Dallas Laredo

1052
00:48:12,480 --> 00:48:15,160
Speaker 1: fifty times a day, they're not going to quote aggressively

1053
00:48:15,160 --> 00:48:17,560
Speaker 1: as us because they don't have the consistent carrier capacity

1054
00:48:17,560 --> 00:48:19,239
Speaker 1: to offer that price. So this is what you talk

1055
00:48:19,280 --> 00:48:20,680
Speaker 1: about when you're like you really want to own a

1056
00:48:20,760 --> 00:48:23,120
Speaker 1: lane because then you can if you can sort of

1057
00:48:23,120 --> 00:48:26,400
Speaker 1: like build up consistent capacity that you can always access

1058
00:48:26,600 --> 00:48:29,640
Speaker 1: between two key locations, so we you have a more

1059
00:48:29,680 --> 00:48:33,439
Speaker 1: economical yeah, we call So there's three types of lanes.

1060
00:48:33,440 --> 00:48:35,800
Speaker 1: There's low volume lanes, which are under one load of

1061
00:48:35,880 --> 00:48:38,279
Speaker 1: day throughout a three and sixty five day period of time.

1062
00:48:38,520 --> 00:48:40,880
Speaker 1: There's a mature lane, which is one load of day

1063
00:48:40,960 --> 00:48:42,600
Speaker 1: or more, and then there's a power lane, which is

1064
00:48:42,600 --> 00:48:44,839
Speaker 1: two and a half loads a day or more um.

1065
00:48:44,880 --> 00:48:47,560
Speaker 1: And we're constantly focusing on how much of our freight

1066
00:48:47,640 --> 00:48:50,040
Speaker 1: is on one of those mature power lanes. Right if

1067
00:48:50,040 --> 00:48:52,840
Speaker 1: you look back five years ago, maybe twenty on what

1068
00:48:52,880 --> 00:48:56,680
Speaker 1: we would consider mature power today, it's like SEV. So

1069
00:48:56,760 --> 00:48:58,759
Speaker 1: that's how you drive a lot of margin expansions. You

1070
00:48:58,840 --> 00:49:02,479
Speaker 1: drive consistency, you drive procurement capabilities. You can then pass

1071
00:49:02,560 --> 00:49:05,279
Speaker 1: that savings onto your customers, and everyone wins because it

1072
00:49:05,280 --> 00:49:07,279
Speaker 1: cares are getting what they're needing and the customers are

1073
00:49:07,280 --> 00:49:10,640
Speaker 1: getting their freight at a competitive rate. A big picture

1074
00:49:10,719 --> 00:49:12,840
Speaker 1: question for you. So one of the reasons Joe and

1075
00:49:12,880 --> 00:49:15,480
Speaker 1: I are here is because obviously the mainstream media are

1076
00:49:15,520 --> 00:49:18,040
Speaker 1: suddenly all over supply chains, And I know you all

1077
00:49:18,080 --> 00:49:20,360
Speaker 1: have been doing it for many, many years, even decades

1078
00:49:20,400 --> 00:49:24,200
Speaker 1: in some cases, but given what we've seen over the

1079
00:49:24,239 --> 00:49:26,960
Speaker 1: past couple of years since the onset of the pandemic,

1080
00:49:27,560 --> 00:49:29,280
Speaker 1: and I know there's been a lot of talk, especially

1081
00:49:29,320 --> 00:49:33,640
Speaker 1: in the government about how to improve things from your perspective,

1082
00:49:33,680 --> 00:49:37,400
Speaker 1: from a freight brokerage perspective, if you could do anything

1083
00:49:37,640 --> 00:49:42,880
Speaker 1: to supply chains transport logistics to make things better or

1084
00:49:43,040 --> 00:49:46,359
Speaker 1: easier for supply chains as a whole, you know, whether

1085
00:49:46,400 --> 00:49:49,680
Speaker 1: it's building out the ports, improving the roads, I don't

1086
00:49:49,680 --> 00:49:52,440
Speaker 1: know what would it be. So you said the thing

1087
00:49:52,480 --> 00:49:54,760
Speaker 1: that there's always a lot of chatter on the throughput

1088
00:49:54,760 --> 00:49:57,279
Speaker 1: through the ports, but I don't we we are very

1089
00:49:57,320 --> 00:49:58,879
Speaker 1: focused on the middle mile. So I'm going to talk

1090
00:49:58,880 --> 00:50:00,960
Speaker 1: about that part of the the social change is. I

1091
00:50:00,960 --> 00:50:03,440
Speaker 1: have a lot more intel into that. Um you know,

1092
00:50:03,560 --> 00:50:05,040
Speaker 1: I think it's a lot about what we talked about

1093
00:50:05,040 --> 00:50:07,239
Speaker 1: as tech adoptions. How do we get every you know,

1094
00:50:07,320 --> 00:50:10,120
Speaker 1: shipper to be able to connect via rate APIs, to

1095
00:50:10,120 --> 00:50:11,759
Speaker 1: be able to get all of our updates via a

1096
00:50:11,840 --> 00:50:13,680
Speaker 1: p I S, to be able to interact and not

1097
00:50:13,760 --> 00:50:15,319
Speaker 1: have to have a lot of the manual back and

1098
00:50:15,320 --> 00:50:17,640
Speaker 1: forth processes which you're starting to see. And then on

1099
00:50:17,680 --> 00:50:20,160
Speaker 1: the carrier side is adoption of technology. Right, it's getting

1100
00:50:20,160 --> 00:50:22,440
Speaker 1: the people, um that live in West Virginia that I

1101
00:50:22,520 --> 00:50:24,320
Speaker 1: you know where I grew up too. You know, I

1102
00:50:24,400 --> 00:50:26,160
Speaker 1: want to use the app, to want to use the portal,

1103
00:50:26,239 --> 00:50:28,080
Speaker 1: to want to put in the preferences, to want to

1104
00:50:28,120 --> 00:50:30,680
Speaker 1: be able to accept and reject via email rather than

1105
00:50:30,680 --> 00:50:33,560
Speaker 1: having to take a phone call and negotiate every single thing. Um.

1106
00:50:33,600 --> 00:50:36,160
Speaker 1: So it's it's all around adoption of technology for for

1107
00:50:36,200 --> 00:50:39,680
Speaker 1: the middle mile. Um. And then you're gonna it's it's

1108
00:50:39,719 --> 00:50:41,600
Speaker 1: such a fragmented market. You're still going to have the

1109
00:50:41,600 --> 00:50:44,000
Speaker 1: ebbs and flows and you know equal livery in versus

1110
00:50:44,000 --> 00:50:47,080
Speaker 1: inflationary versus deflationary. That's not going to go away. Um.

1111
00:50:47,120 --> 00:50:49,080
Speaker 1: It's such a it's such a large market and it

1112
00:50:49,120 --> 00:50:51,120
Speaker 1: moves in so many different directions that even a small

1113
00:50:51,200 --> 00:50:55,279
Speaker 1: move in one direction causes crazy, you know, ripple effects. Um.

1114
00:50:55,320 --> 00:50:59,080
Speaker 1: But I think technology and integration and connectivity between customers

1115
00:50:59,120 --> 00:51:01,360
Speaker 1: and brokers and carrey is going to drive to a

1116
00:51:01,440 --> 00:51:04,080
Speaker 1: much better experience for everyone. And it's nature just a

1117
00:51:04,080 --> 00:51:07,360
Speaker 1: matter of time. Are there policies that could accelerate that process?

1118
00:51:07,440 --> 00:51:10,120
Speaker 1: Of getting in technological alignment or is it just like

1119
00:51:11,000 --> 00:51:13,480
Speaker 1: sort of slugging it out and one platform tries to win,

1120
00:51:13,560 --> 00:51:15,799
Speaker 1: Like I mean, rolling out E l d S was

1121
00:51:15,840 --> 00:51:19,960
Speaker 1: like crazy, crazy talk until a lot of assets. Um.

1122
00:51:20,120 --> 00:51:23,480
Speaker 1: So I definitely think the industry is a lot lacks

1123
00:51:23,520 --> 00:51:26,160
Speaker 1: a little bit um. But once again, like I've said,

1124
00:51:26,200 --> 00:51:28,760
Speaker 1: a lot, you know, it's definitely catching up and it's happening.

1125
00:51:29,239 --> 00:51:33,240
Speaker 1: So one more question for me about the future, and

1126
00:51:33,520 --> 00:51:35,680
Speaker 1: again based on something that Joe and I have learned

1127
00:51:35,680 --> 00:51:39,240
Speaker 1: just being at this conference, but the industry itself sounds

1128
00:51:39,960 --> 00:51:44,120
Speaker 1: very very cyclical, right like boom bust cycles, low barriers

1129
00:51:44,120 --> 00:51:47,600
Speaker 1: to entry, lots of fragmentation, as we've been discussing. Is

1130
00:51:47,600 --> 00:51:52,680
Speaker 1: it always going to be that way? Yeah, I mean

1131
00:51:52,880 --> 00:51:56,320
Speaker 1: you would think that eventually with you know, autonomous technology

1132
00:51:56,520 --> 00:52:00,480
Speaker 1: and more trailer pools and more equilibrium of from apacity,

1133
00:52:00,560 --> 00:52:04,080
Speaker 1: so better efficiency at the shippers and the constanteese so

1134
00:52:04,160 --> 00:52:06,040
Speaker 1: to where it's not having we always hear about the

1135
00:52:06,080 --> 00:52:09,440
Speaker 1: driver's shortage, but really we just have a misuse of capacity,

1136
00:52:09,680 --> 00:52:12,600
Speaker 1: a lot of inefficiencies. You know, four hours on every

1137
00:52:12,600 --> 00:52:14,719
Speaker 1: single load. Is that a shipper and constanty that's without

1138
00:52:14,719 --> 00:52:18,439
Speaker 1: a delay. Um, so really focusing on those different things

1139
00:52:18,440 --> 00:52:21,560
Speaker 1: that can drive efficiency. Um. You know, I think that

1140
00:52:21,600 --> 00:52:23,600
Speaker 1: will take some of the cyclicality out of it, and

1141
00:52:23,640 --> 00:52:26,280
Speaker 1: that will make it more of a consistent volume play.

1142
00:52:26,320 --> 00:52:28,440
Speaker 1: But as as long as there's continuing to be you know,

1143
00:52:28,480 --> 00:52:32,880
Speaker 1: capacity challenges, it's going to be cyclical. So obviously Tracy

1144
00:52:32,920 --> 00:52:36,879
Speaker 1: and I are thinking of starting a freight brokerage after this.

1145
00:52:37,000 --> 00:52:40,040
Speaker 1: And you mentioned that whoever said there's twenty margins of

1146
00:52:40,040 --> 00:52:43,640
Speaker 1: this business are lying? But what can you get? Yeah,

1147
00:52:43,680 --> 00:52:45,520
Speaker 1: I mean it depends on the type of freight, right,

1148
00:52:45,560 --> 00:52:47,920
Speaker 1: So when I always one of the one of the

1149
00:52:47,960 --> 00:52:50,200
Speaker 1: things I always focus on with our investors and with

1150
00:52:50,280 --> 00:52:53,400
Speaker 1: our board is really spread per load. What is our

1151
00:52:53,600 --> 00:52:55,200
Speaker 1: cost per load? What is our spread per load? And

1152
00:52:55,200 --> 00:52:58,440
Speaker 1: what is our EBADU per load? Um? So from a percentage,

1153
00:52:58,480 --> 00:53:01,279
Speaker 1: if revenue proloads three thou and because it's a you know,

1154
00:53:01,280 --> 00:53:04,120
Speaker 1: a longer length of hall, you're not gonna make on that,

1155
00:53:04,120 --> 00:53:06,040
Speaker 1: You're not gonna make four and fifty forever. It's it's

1156
00:53:06,080 --> 00:53:09,120
Speaker 1: too competitive, right, So, really like trying to triangulate and

1157
00:53:09,200 --> 00:53:12,359
Speaker 1: understand from a spread proloa dollar where the market where

1158
00:53:12,400 --> 00:53:15,080
Speaker 1: the industry is gonna be over time that's really what

1159
00:53:15,120 --> 00:53:17,759
Speaker 1: we focus on. So like to answer your question, you know,

1160
00:53:18,000 --> 00:53:19,719
Speaker 1: we have long length of hall that can be as

1161
00:53:19,800 --> 00:53:22,759
Speaker 1: low as five or six percent margin um, and we've

1162
00:53:22,800 --> 00:53:24,920
Speaker 1: got shorthaul that can be twenty percent margin, but the

1163
00:53:24,960 --> 00:53:27,160
Speaker 1: revenue is only to fifty and then we lose on

1164
00:53:27,160 --> 00:53:29,760
Speaker 1: ten percent of our trucks are you know, are are loads.

1165
00:53:29,760 --> 00:53:32,280
Speaker 1: So that's negative margins, right, So like from a blooded

1166
00:53:32,280 --> 00:53:33,920
Speaker 1: out average, you know, kind of what I think the

1167
00:53:33,960 --> 00:53:36,360
Speaker 1: market take right that people constantly talk about is you know,

1168
00:53:36,400 --> 00:53:38,400
Speaker 1: getting to a world of like ten to twelve percent

1169
00:53:38,480 --> 00:53:41,120
Speaker 1: margins and driving enough automation to be able to still

1170
00:53:41,160 --> 00:53:43,640
Speaker 1: drop five percent to the bottom. All right, So another

1171
00:53:43,760 --> 00:53:45,879
Speaker 1: question for the brokerage we're gonna start, I mean our

1172
00:53:45,920 --> 00:53:48,919
Speaker 1: podcast it's called odd Lots, and so you know, we're

1173
00:53:48,920 --> 00:53:52,240
Speaker 1: obviously not gonna be competing on like the really major lanes.

1174
00:53:52,400 --> 00:53:54,400
Speaker 1: Will like leave that to you, But like, are the

1175
00:53:54,800 --> 00:53:58,480
Speaker 1: big opportunities in the sort of in the really small

1176
00:53:58,560 --> 00:54:01,759
Speaker 1: lands that do not have uh, you know, very much

1177
00:54:01,840 --> 00:54:05,840
Speaker 1: back and forth traffic and maybe their supply imbalances in

1178
00:54:05,880 --> 00:54:09,399
Speaker 1: one city versus a destination city. Sounds like it feels

1179
00:54:09,400 --> 00:54:11,719
Speaker 1: like the most opportunities in those in those marketing want

1180
00:54:11,719 --> 00:54:14,000
Speaker 1: to come to the meeting. Absolutely, I love to. Yeah. Yeah.

1181
00:54:14,040 --> 00:54:16,000
Speaker 1: So one of the things that we do, and it's

1182
00:54:16,000 --> 00:54:18,480
Speaker 1: a great question, is we're not going to always be

1183
00:54:18,520 --> 00:54:21,360
Speaker 1: great at the high volume regional because the large assets

1184
00:54:21,360 --> 00:54:23,239
Speaker 1: are super good at that right, that is there We

1185
00:54:23,360 --> 00:54:25,520
Speaker 1: all as a broker are avitually at the falls is

1186
00:54:25,520 --> 00:54:28,160
Speaker 1: almost seven miles. So we're going after the tweener lanes.

1187
00:54:28,320 --> 00:54:30,000
Speaker 1: You know that five hundred to a thousand, the long

1188
00:54:30,080 --> 00:54:32,480
Speaker 1: length of haul over the road driving is is not

1189
00:54:32,520 --> 00:54:35,279
Speaker 1: what it once was. Um So, we have to be

1190
00:54:35,320 --> 00:54:37,600
Speaker 1: good at those one off lanes. We have to be

1191
00:54:37,640 --> 00:54:39,520
Speaker 1: good at those lanes that a lot of the assets

1192
00:54:39,520 --> 00:54:41,719
Speaker 1: don't want to build their network around. That's where our

1193
00:54:41,800 --> 00:54:44,360
Speaker 1: value comes in. Um So. One of the things that

1194
00:54:44,400 --> 00:54:46,560
Speaker 1: we really constantly do is that we basically look for

1195
00:54:46,640 --> 00:54:49,560
Speaker 1: arbitrage on what are lanes that you know are hard

1196
00:54:49,600 --> 00:54:52,759
Speaker 1: for shippers to cover but are easy for us to cover. Right,

1197
00:54:52,800 --> 00:54:55,839
Speaker 1: that's that's what's the lane. What's a So I used

1198
00:54:55,920 --> 00:54:58,719
Speaker 1: Dallas to Larrato earlier, right, So, Dallas to Larrato. If

1199
00:54:58,719 --> 00:55:01,120
Speaker 1: you look at the shipper to brook shipper to carrier rate,

1200
00:55:01,360 --> 00:55:03,719
Speaker 1: there's about two I'll just make it up called a

1201
00:55:03,760 --> 00:55:07,040
Speaker 1: hundred and fifty dollar delta between shipper carrier from broker

1202
00:55:07,080 --> 00:55:10,080
Speaker 1: to carrier, So there's a there's margin opportunity there. But

1203
00:55:10,360 --> 00:55:12,920
Speaker 1: Laredo to Dallas, if you look overlay those two rates,

1204
00:55:12,960 --> 00:55:15,680
Speaker 1: they're almost equal. So that's a rate that there's not

1205
00:55:15,680 --> 00:55:17,600
Speaker 1: going to be a whole lot of opportunity to drive

1206
00:55:17,760 --> 00:55:20,920
Speaker 1: significant volume on. So looking at the like the basically

1207
00:55:20,960 --> 00:55:24,160
Speaker 1: the market of where we can drive incremental margin because

1208
00:55:24,200 --> 00:55:26,440
Speaker 1: we have the right capacity at the right cost is

1209
00:55:26,440 --> 00:55:29,000
Speaker 1: a big part of what we do. Just don't blindly

1210
00:55:29,040 --> 00:55:32,480
Speaker 1: quote everything. We need to develop an app or a

1211
00:55:32,480 --> 00:55:35,440
Speaker 1: web based portal could do that. We need to identify

1212
00:55:35,520 --> 00:55:39,880
Speaker 1: some quiet lanes, preferably short haul to maybe get margins,

1213
00:55:40,200 --> 00:55:42,120
Speaker 1: and then we need to go head to head with Matt.

1214
00:55:42,400 --> 00:55:45,239
Speaker 1: The problem with shortball is you're making like in your

1215
00:55:45,239 --> 00:55:47,440
Speaker 1: cost prolad is gonna be tough. So I wouldn't build

1216
00:55:47,440 --> 00:55:52,080
Speaker 1: a business on that. So we just have a couple

1217
00:55:52,120 --> 00:55:53,759
Speaker 1: of minutes left. But any sort of you know, I

1218
00:55:53,800 --> 00:55:57,000
Speaker 1: want to just go back to the macro situation, like

1219
00:55:57,040 --> 00:55:58,799
Speaker 1: what's your feeling, what are you watching for over the

1220
00:55:58,840 --> 00:56:01,520
Speaker 1: next few months? Yeah, I mean, you know, obviously we're

1221
00:56:01,560 --> 00:56:03,680
Speaker 1: coming into produce season. We're coming into a hundred days

1222
00:56:03,719 --> 00:56:06,080
Speaker 1: of summer. UM, it's gonna be really interesting to see

1223
00:56:06,120 --> 00:56:08,520
Speaker 1: what happens. You know, our service is going to continue

1224
00:56:08,520 --> 00:56:11,920
Speaker 1: to you know, gain market share over durable goods. Is

1225
00:56:11,920 --> 00:56:14,400
Speaker 1: there a pent up inventory of you know, people weren't

1226
00:56:14,400 --> 00:56:16,600
Speaker 1: buying autos because that industry has been really hit with

1227
00:56:16,600 --> 00:56:19,279
Speaker 1: the silicon issues. Um. You know, so we're just looking

1228
00:56:19,280 --> 00:56:21,399
Speaker 1: at all the things that we talked about earlier. UM,

1229
00:56:21,440 --> 00:56:23,719
Speaker 1: it's too early to make a call on like what

1230
00:56:23,800 --> 00:56:27,000
Speaker 1: the future looks like in twelve months. UM, but you know,

1231
00:56:27,040 --> 00:56:29,040
Speaker 1: every single day, every single week, we feel like we're

1232
00:56:29,040 --> 00:56:30,920
Speaker 1: building more and more confidence in what are you know,

1233
00:56:30,960 --> 00:56:34,239
Speaker 1: twelve months twenty four month outlook looks like. Um, but

1234
00:56:34,600 --> 00:56:36,600
Speaker 1: I don't want to go on record and make any

1235
00:56:36,600 --> 00:56:39,600
Speaker 1: crazy preditions, but it's it's definitely there's a lot of variables.

1236
00:56:39,880 --> 00:56:42,439
Speaker 1: There's a lot of things moving around, and as as

1237
00:56:42,480 --> 00:56:44,880
Speaker 1: of this minute, it indicates that we're going to continue

1238
00:56:44,920 --> 00:56:47,360
Speaker 1: to feel a lot of downward pressure on both spot

1239
00:56:47,480 --> 00:56:49,960
Speaker 1: and contract rates over the next nine to twelve months.

1240
00:56:50,960 --> 00:56:53,600
Speaker 1: Al Right, Well, Matt Pious, thank you so much for

1241
00:56:54,160 --> 00:56:57,279
Speaker 1: participating this live episode of the podcast with us. This

1242
00:56:57,360 --> 00:56:59,600
Speaker 1: is really fun. I learned a ton. Thank you, thanks

1243
00:56:59,600 --> 00:57:01,920
Speaker 1: for having yeah, and thank you to Freight Waves as

1244
00:57:01,920 --> 00:57:04,800
Speaker 1: well for inviting us over to the logistics and transport

1245
00:57:04,840 --> 00:57:07,640
Speaker 1: tourists for a couple of days. Super fun. Thank you

1246
00:57:07,719 --> 00:57:08,480
Speaker 1: very much. Thank you