Freight Optimization Tactics for Sustainable Success

Machine Automated Transcript: Hey everyone, welcome back to our show. And so today we’re going to no pun intended, cross into a different lane, or try to just kind of move into a little lane, a different lane, which is logistics only because there’s a lot of when you see a Venn diagram, you can see trade logistics. And there’s a big there’s that you would see a good crossover there between those two. So this was brought forth. We discovered Andy and I, we went to TPM earlier this year, but we discovered a whole new part of the business, which is logistics, transportation, shipping, you know, containers and all that kind of good stuff. But I was invited earlier, before that, I was invited to be a speaker at a conference in Colombia, in Cartagena, where I got to speak about the trade compliance culture and forced labor and all that to a bunch of people in logistics. So that was kind of cool. I mean, I was a little bit of fish out of water. I mean, I’ll admit that, because I had, you know, everybody there was logistics, except there was two of us that were not Damon John and myself. Damon John from the Shark Tank, you know, we were both, like, we were both speakers at this and anyway, so we were just kind of like, you know, talking about something different, other than logistics, which was, I felt was a, was a cool conference because of that, but that’s where I got introduced to this group called Lean Solutions Group. We had them on our show, introducing the conference as well. But Andy and then you and I, almost soon after that, went to TPM, where we discovered, again, not discovered, but got introduced to, thank you to the people at the Journal of Commerce and SMP global that had us there as guests as well. And we just managed to find this new audience and people that we can talk to about everything we’d like to talk about

different training well. And the thing is, is that is so great the the folks from the the TPM stands for the Trans Pacific maritime and that was the TPM 24 conference there in Long Beach, and it was just opened up a whole new realm for our audience. And apparently those folks are enjoying our show, and it’s been a great exposure for them as well as us. So now I’m looking forward to having this discussion here with our guests today on several things here. So why don’t you introduce Abby and bring her on? Sure.

So as part of my visit to Cartagena, I met a bunch of wonderful people out there and people that work within lean Solutions Group. And of course, the ones that are the most vocal, or not vocal, but active within are obviously salespeople, and you know, people who are promoting their company. And so in

that, I got to connect with Abby. Okay, I got to connect with Abby, half and brittle, Hoff and brittle, or half and brittle, huff and brittle, both. And so we decided to invite her on here. I had been collaborating a little bit with her marketing people and their operations people a little bit just to figure out a way that we can introduce this, this topic, to our audience. And so Abby reached out to her, and she was very generous in saying, Okay, I’ll come on. How about tomorrow? So here we are, 24 hours later. And so Abby, welcome to the show. Thank you for coming on and short notice,

absolutely, thank you for having me. I’m excited tell

us about what you do there then at lean. And a little bit introduction there for Lean, absolutely.

Yeah. So I work at a company called Lean solutions, and we basically set up satellite offices for US based companies to do back office roles that easily can be done remote so a lot of our company but all the companies that we work with, our transportation supply chain companies, so I think about 90% of our probably 600 customers are freight brokers, freight forwarders, asset companies, tech, software companies in the industry. So we’ve really developed a niche and have been the go to provider and partner for a lot of us, based shipping and transportation companies.

Excellent. So as we were talking offline, there a little bit is that we’re going to be getting into a discussion today on, you know, like some of the transportation industry, and I guess, as it relates, are you looking at, like international or domestic transportation type situations, or what are you going to talk about here?

Yeah, so anything. Really, I so for a little background, I worked in transportation for about almost 10 years at a couple different freight brokerages, asset companies, and we were primarily, you know, domestic full truckload over the road. But here at lean, we work with all types of companies, and we handle, we can handle any sort of, really operations. So like freight forwarders, it’s a lot of international paperwork that our people are, like, going through data input and that sort of thing. So yeah, we can, we can do either. But I really have a good Hone on what’s going on in the US with the current climate of the market and how things have kind of elevated or lack of elevated, I should say, in the last two years in this market,

I was just gonna say there’s been a recession in the like the trucking industry, in the in the in the multimodal industry, where there’s Been a drop, actually in some of those types of volumes.

Yeah, volumes overall, for a lot of manufacturers and shippers, have decreased year over year. And that has to do with a lot of different things, you know, like consumer spending, the rise of E commerce, and the I would say, the rise of, like, final mile deliveries and customers expectations of needing fast and reliable service has escalated higher than it ever has. And then you add in, you know, labor shortages, issues with the infrastructure bottlenecks at the ports, it’s kind of created this

like ball of momentum, negative momentum. I guess you could say that normally, the market would have kind of started flipping Well, long ago. That’s our phrase, a long time ago, and that’s what we’re seeing right now. It’s kind of a new a new market we’re in with all of these things kind of happening at once. And I think a lot of people in the industry are looking at what is going to be the next model in our industry, in brokerages, freight forwarders, asset companies, and how we’re going to sustain kind of a new normal in our market?

Well, Abby, I was going to say Abby has hit on a lot of the topics. We’ve had individual topics, on several things that you just talked about over the last year or so. You know, look at you, and you’ve got a great summary on this. So it’s like, I love it,

but that’s, that’s also the cool thing, and that’s why, like I said, if you look at a Venn diagram, you’re gonna see trade and logistics here, and then somewhere in that crossover. I mean, there’s, there’s always a correlation. I mean, truckers cannot move stuff without stuff being cleared through trade, right? And then vice versa. There’s nothing to move if the, you know, in the trade industry, if the people aren’t moving it, you know what? I mean, they were shipping it, so Exactly. And then that’s the main reason why I’m excited about trying to bring this new and again, no pun intended, move into that lane a little bit, you know, and and kind of cross over a little just so that we can get a more holistic view of the industry and the business, which is really cool. But like Andy said, Abby, it’s like, we’ve had guests after guests talk about a little bit of about all those little things that you talked about in supply chain, resiliency is huge. You know, people just talk about, how are you gonna, I mean, and I guess it applies to your to your industry too, you know, logistics, resiliency, right? I mean, I guess, I guess we can start with a pandemic, how things affected it, and then how moving forward, and how it was before, and all that, you know, I guess correlate all that together in your conversation. I I’m assuming that would be a natural route to talk about, so for

sure? Yeah, absolutely.

Well, you, you were mentioning it’s like a new business model, if you will, in this particular realm. So what is it that you’re, you’re seeing, let’s, you’ve, you’ve got this. I mean, things have kind of tanked in some things. Obviously, there are some issues where people are needing to company wise transportation companies should have adapted, and may not have, or whatever. But what do you see the current situation? And then we can talk about, what do we what’s the next step?

Right now in I’ll just, I’ll just be I’ll just talk about what I know for sure because but it’s pretty broad, and I’m sure it will cover all you know, domestic and international, but margin compression is a number one topic with all you know, transportation providers right now. And basically what happened was, over during covid, there was a time of opportunity, right? So a lot of these freight companies. Companies saw the opportunity to make a lot of money. So you had asset companies buying more trucks, you know, like thinking, this is our time to get rich. Brokerages adding a ton of resources, hiring a ton of people, because they’re just an excess of opportunity. And so like for us at lean, we got a ton of customers, because everyone needed help. Everyone it was good, you know, it was great business. Then now fast forward, and it’s just obviously gone downhill from there, with a lot of the

things that I that I talked about with volumes, labor shortages, tech adding into a lot of these companies. So all of the this infrastructure that was added now they don’t have the demand anymore. So, you know, there’s a lot of drivers that had to leave their truck sitting because it’s cheaper than, you know, paying the insurance and the very low rates just didn’t make sense for a lot of companies to keep moving the freight. So margin compression is is a huge topic. So right now, a lot of companies are assume, we’re assuming and forecasting that the market would shift by now. And they, you know, the transportation industry goes in cycles. So there’s ebbs and flows, you know, and when there’s a down, there always is a rise. Right now the rise is not going as quickly as a lot of these companies were expecting. So they assumed by now they could kind of re make up for all the losses in the last two years, really, and they’re realizing this could very well be a new normal, and it’ll slowly start to get better and improve, but that will It will probably take a lot more companies going bankrupt that can’t support their business because lack of volume and lack of margin within their freight then to be able to take on the overhead costs. So what I’m really seeing moving forward is a lot of tech integration, figuring out how to use AI to automate systems processes, and then, obviously, near shoring as well figuring out, how can we be as profitable as we can, you know, keep our customers happy, but use our resources to be able to take some of that cost and workload off of us employees and put it on, you know, office in Columbia, like what we do at lean, or using tech to replace people in the US so that they’re able to keep the business profitable, even with the current margin compression that’s been happening. And why? A lot of these big brokerages, you know, get convoys at some of these others that are that, well, either went bankrupt or are in big trouble. A lot of the touch of this, a lot of the strategy in the past with landing shippers getting new business, especially high level enterprise shippers, you know, get Niagara freight or Niagara bottled water with that ConAgra. A lot
of these big food and beverage shippers to be, to be a brokerage and get into a company like that. A lot of times the strategy is to buy market share on a RFP, right? So shippers send out RFPs, and this is how they assess their network, and then they assign certain loads and lanes based on, usually based on price and service. And then those carriers have those that business contracted to them, and it’s usually on a yearly, annual basis. So that means when we go in and bid the freight, we have to look at a year’s worth of data to kind of put our price in the middle so that we know, okay, we’re we could be in a good spot to win this freight. You know, we’re competitive, but then also when the ebbs and flows, we’re average, averaging out, and we’re able to still keep a margin in the so what was happening was, and a strategy with like the Uber freights all these big brokerages, is, let’s just, for the first year, go super low. We’ll take the hit, we’ll take losses so that we have this market share,
and then the next year, we’ll prove ourselves with service, and we already have the lanes. It’s a lot easier to keep it and just adjust the rate, because you already proved that you did a good job, right? So the problem, and with all that, obviously, is the market never shifted. So now a lot of these companies are stuck with this. Rate that is losing a lot of money. So these companies cannot figure out how to get out of the red zone. They just are bleeding without cutting off these customers. So that’s why you’ve seen a lot like a lot of these big companies have basically halved, you know, their annual revenue because they’ve had to cut ties with a lot of this freight that they accepted and couldn’t they’re probably still performed on. But obviously it was costing them a lot of money to take on it. It was

costing more than they were making kind of a deal,

Exactly, yep. And so, you know, kind of similar with convoy and not having the proper structure and forecasting in their organization, and then their operating ratios being so extremely high, it just kind of it’ll cause a lot of issues. Obviously, could lead to bankruptcy if it gets too bad. So that’s why right now, a lot of companies are trying to figure out, Okay, what’s next? If the market stays like it is right

now, we need to figure out how to stay profitable and how to keep operating and still grow and scale to where they want to be. So and that’s where tech automation and then, you know, looking at outsourcing or near shoring your talent so that you’re able to, again, keep the revenue generators in the United States making money, making the company money, but then they’re all supported by either technology that’s automated or, you know, people that are that are more cost effective in other areas of the world to facilitate that. And I think that is kind of the next chapter in our in the transportation the book of transportation is, how now are we going to manage this new normal? And I think a lot of shippers, a lot of these big, you know, your again, your Niagara, your your massive shippers that have over a billion dollar freight spend, they’re also looking at how they’re going to operate with, you know, The new models that carriers and brokerages are implementing,

well, with that, let me ask this question is from a business consumer perspective, and I’m talking about, you know, a business to business type transactions and all that a business is looking for, you know, The transportation services and for their supply chain to their end customers. What would you recommend that they you know, somebody needs to take into account based on this new business model you’re talking through here, of what the struggles and all of that that the current service providers are facing. If I am looking to say I need to, you know, secure some contracts with some transportation companies. What is it that, from my perspective, would you recommend that I need to be looking for in dealing with somebody before I sign on to a contract?

You know, there’s a couple different things. I would say it does depend on the nature of the freight. So is it high touch freight that needs a lot of attention and kind of like a control tower of operations? Or Can, can you just book it and kind of let it sit. So for me, I think understanding the company’s financial health, understanding their initiatives for moving forward, and how, like, if I was a shipper, I would ask my carriers, like, how are you guys planning for the future, what are you guys doing to adjust to the market and stay profitable still? Because as a as a business, you always want the other business you’re working with to still be profitable, because it is not going to be a good partnership. You know, there has to be wins for both sides, and it’s also really important still, in my opinion, to have those relationships. And our industry is so old school that I think it’s going to be a long time before those relationships really go away. And you see kind of the debate between digital freight brokerages versus traditional freight brokerage models, where it’s one is like a no touch, no humans really involved, and the other is very relationship based. And a lot of the opportunity in our industry still comes from building those relationships, building up that credibility and trust, so that the shipper knows that if you, if he, he or she gives you a contract, that. That and honor the commitment, because there is, you know, when you when you agree to that, yes, it’s a contract, but a lot of carriers will just give back loads, give back their freight, and then the shipper is left stranded without any um, without any any backup plan. So, and that’s why a lot of these large shippers don’t really love working with brokerages, because a broker doesn’t have full control over that carrier. You know, it’s a, it’s a, we’re a matching service, basically, so making sure they are doing a good job vetting their carriers and their insurance is up to date, their authorities are in place because it could put the shipper at a lot of liability. And that’s another big issue in our industry, is theft, fraud, a lot of stolen loads. There’s a lot of this going on, and it’s it’s not great. You know, I hear of companies every day that are getting hacked, and, you know, their loads are getting posted, a lot of double brokering, it’s and that’s why you’re seeing a lot of these new tech companies coming into play that are helping to get around this. You know, carrier assure is one of them. Carrier for among a lot of those that vet the carriers and put a grade to the carriers to make sure they are good for your customer freight. So that’s why a lot of shippers are trying to stay away from brokerages and go direct to the asset companies. But again, the asset companies have to they operate in a cost per day, or usually a cost per day model, and so

they have to understand the cost of the truck per day, and with assets, there’s not a lot of wiggle room. It’s this is what we cost, and that’s it. Where brokerage, you know, you have that flexibility to go up and down and be able to negotiate with your carrier partners. So it’s for a shipper. You know, brokerages are a must if you have seasonality and a lot of like volume fluctuations, and you need a brokerage partner to be able to take some of that. But then their core business, they’re really pushing to the assets, because they then have full control over those drivers. And those drivers, and those drivers are employees of the company, and it’s not a third, you know, a third party in between

partnership, yeah, but the trade off, though, is dealing with a brokerage firm. They’re able to source out to multiple things. If you want to take that in in house and you’re going directly to the asset company. That’s fine, but now you’re going to have to keep up with all the different locations and try and make those contacts. I mean, the trade off. There is a brokerage firm already has the relationship with so many different carriers across the board. That’s where I caution people be careful of being penny wise and pound foolish. Yes, you can go directly to some of these companies and get a better rate, or whatever the case is for a specific lane, but then the trade off is, oh, well, that company doesn’t run on this lane route that I need to take now. I’ve got to spend my time to go check somebody else or heck, hence you go back to a brokerage first. Let’s, let me shift gears here. What about from a transportation side, a service provider? Let me put it that way. That would be, you know, say a brokerage firm is one, but then the other is the the actual asset company, as you were talking about, from their perspective, what should they be doing? I mean, I’ve seen a lot where the chain that the of most recent people have pretty much stopped trying to, if you will buy the business, as you say, going in low and just say, basically, you know, here’s what I’ve got to have, or here’s what my rate is, and they won’t go but down any lower, and people try and beat them down, but they, in my opinion, have to be prepared. You’re gonna have to walk away from that business if they’re saying, Well, you know, my rates, you know, $1 and, no, I want 75 cents. Like, you know, I’m sorry,

yeah, absolutely, I would say. And again, I’m working with a lot of freight companies, so I’m talking every day with CEOs, trying to figure out what they’re doing, what their plans are. And I think the gap is not understanding your operational costs. And so whenever I kind of consult with companies, I ask them, like, what is your cost per load? If they can tell me and and they understand their cost per load, how much it takes from start to finish, then usually they have a pretty good grasp on their operations. So. But I think again, that is a gap. These companies are not understanding how much overhead they have and how to get new business that actually works for the shipper partners. So when I I was always in sales at my translation companies. So when I look to land new customers or win a win freight on an RFP, and I know, you know, I was, I just worked at a startup. We didn’t have a cash reserve. We couldn’t go under debt and bid under debt against and compete against the Ubers and the convoys of the world. We just, there’s no way. We couldn’t do that. But what we could do is guarantee our service, and how we do that is strategically selling based on, you know, their lane needs. So when I get an RFP, I’ll usually first connect with the shipper and let and say, Hey, which of these lanes are you actually looking to award? Because, again, it’s relationship industry. So a lot of you know there might be 1000 lanes on a bid. Well, if I’m going through and spending a ton of resources to look and bid on every one of those, it’s probably never going to be a great win, because then the shipper is like, if you can do everything, then you can’t really do anything. You don’t have a niche. What shippers want to see is strategic partners that are like, Hey, I see you. Have a national to Charlotte lane. I have four carriers on that lane that run this every day, all day long. We would love to add this lane to yours, because we’re, you know, we have a truck in there anyway. We’re already there at both of your locations, so let us try this lane. And you know, you’re basically guaranteeing service, because we’re already running that every single day. And then you’re also guaranteeing

capacity, because if this carrier isn’t able to take this, you’re you have three other carriers that run this on a regular basis. So being able to kind of show the value and help them see, again, all we’re doing is really connecting the assets with the shipper, right? So showing that value, and not just saying, like, here’s 500 over the lanes, and here’s really cheap rate, you know, and they might award you one or two of those lanes this way, you’re really pushing, like, I have a great group of carriers that run this every day, all day like, and we’re competitive, and, you know, you’ll get service and capacity, no matter what, that’s what shippers really want to see, and then they’re willing to pay a little more for that guarantee of servicing capacity. The guarantee,

and the consistency is whether what I’m hearing you say is basically a company needs to take and identify what their strengths are, and then leverage that for the business on the particular area, rather than trying to be the jack of all trades 100%

and you know, I had shipper partners all the time say, tell me, if you bid On more than 20 lanes. We just, we don’t even look at it. We throw it away. So I think it’s really important to be very strategic, because, again, we want to come in as a partner and not just like and it has to be a win for both people. So I always put myself in the other person’s shoes. Well here instead, this is a real partnership, and this is, you know going to be long term. I’m not just offering you rates for the first year, and then we’re going to jack our prices up, because we have to recoup everything we lost in the last year. Now it’s more like here’s a strategic partnership, and we want to work with you to understand your operations and figure out how we can provide the best solution, which is, again, like the strategic partnerships with the carriers. And it all starts with with the carrier reps as well being able to understand their carriers strengths and their modes, you know. And I worked at a company, and we always said, work trucks, not loads. So instead of every time there’s a load on the board, you work it with a one off carrier. Well, no, no, let’s instead work the carrier and go to the carrier. What do you need? What are your main lanes? Where can I help you get to you know, maybe they need to go home every Wednesday for their son’s basketball game. Okay, if they have a broker that’s like thinking about those things and helping them kind of plan out their weeks and be the dispatcher, if you may, for these asset companies and be the sales people for them. That obviously, then creates that. Buy in for the carrier and they want to keep your business, because now they have a cheerleader for you that’s like helping them. You know, one, make money. Two, have consistent volume, and three, help them get home or do whatever they need to do. So those carriers are going to be able to provide better service and again, then the customer is going to be happy because they’re getting a competitive rate and service and capacity and that guarantee of kind of coverage always so well,

that’s where I will also say the and I like how you put that work the truck, not the just the load is, I’ve seen companies where they are nickel and diming it. Basically, they have, you know, all this business across the country coming out of different and it’s almost they’re shopping different carriers out of the same location or different, you know, wherever they’re going. And in looking at it, you know, literally, I’ve watched where in a five day work week, let’s just say Monday through Friday. Out of one location, they’ll use five different carriers, whatever the best rate was it to me, though, the problem with that is, is that then that company, that end customer that’s saying, hiring for all this stuff to be moved, they’re spending a tremendous amount of time going to different companies trying to manage it and track and trace it, and like, where are we at and what’s going on? And this one and that, rather than dealing with one company or maybe two, but it’s, you know, dealing with one and

saying, you know, make it a win. Wins. Quit trying to, you know, browbeat people down. Well, in the end, I figured up and was pointing this out to some of the upper management. Look at your resources, the the employees of that company managing all of that different stuff, because they’re trying to, somebody’s convinced them, yeah, we can get spot rates, if you will, on different, you know, carriers for the different things, rather than stepping back and look at it holistically and go, let’s see if we can’t get a more aligned. You know, if you want to call it a partnership or a client, supplier relationship, where both win and it works out in the end, you look at things holistically, and both companies win

exactly, and and the carrier wins. And you know, the backbone of our industry is still the drivers, and I think that’s what a lot of these like digital platforms, like the, you know, the convoy platform. I think that’s what they lack, is carriers, yes, for flexibility purposes, they might like using that platform. But as far as, like, issue resolution and having a person to deal with detention, or like, Hey, I’m stuck at the shipper. Help me. You know, I think that is going to be really tough for our industry, because we’re still kind of in the dinosaur ages, like we’re not the industry is, I would say, I don’t know, what are you guys saying? 20 years behind compared to the technology that’s available today. And it’s it’s going to be really hard to just change that overnight. And a lot of these, you know, old school truck drivers, are not going to be in tune with only working with the platform and trying to call somebody and get help. So I think a lot of peers are still gonna want to work with a traditional freight brokerage model, because of the fact that there’s just more care and attention, hopefully for the good freight brokerages, let’s just say, and also they can get, they can have a brokerage again, like I said before, work for them and be the salesperson to set up a good life for them. And it doesn’t always have to be chasing every single load. A lot of carriers will book the loads, you know, the day before, and just try and find the highest rates. Is that really the best, or would you rather have consistent freight that you know, what you’re bringing in every week. You don’t have to go and chase a load here and a load there, and then you might not get it, and you might be sitting for two days and you’re scrambling to try and figure out and then you have to pick up a load here, and you have to find a nut a new load to get you to here, and then the only thing available is, is a, you know, a load that has no money in it, but you have to take it because you have to pick up your customer freight. And it’s, you know, if you have somebody that’s helping you and working with you to set that up for you, I think it just can make a lot of these carriers lives a lot easier. But with that being said, there’s a lot of brokerages that treat carriers like. Garbage. So I think, I think putting our focus back on, like, how can we better integrate with the carrier partners to support our customers in the best way and the most efficient way? And how can we optimize some of the routes? And I think that’s part of the next phase of our industry is route optimization, and shippers even working together to create those efficiencies. And that’s what a lot of shippers are really looking for too well, not

only customer relationships, but also vendor relationships, and literally taking it to the next level, where they’re sitting down and talking about, well, you know, Route Optimization, just like what you’re saying and the whole scenario there, and seeing if you can come up with a mutual Win Win solution that is beneficial to both,

absolutely Sustainability, I would say, is another hot topic for the shippers, that’s a big incentive for from like sea levels at, you know, the Starbucks, the large corporations and to be able to provide Sustainability in a like carbon emissions savings with pairing freight together. So even shippers are working together now to pair their routes. There’s a couple companies, leaf logistics, couple, I think, a

couple others that it’s really interesting in what they’re doing, where they’re taking freight with from multiple companies buying a big not buying, but getting a big chunk of freight and lanes from a lot of different companies, and then combining them and figuring out, okay, here’s one loop, Atlanta, Charlotte, Charlotte, Atlanta, and they sell it as basically one. So then you’re able to MLS company were able to build off of that. And the carriers love that, because, again, it’s consistent, it’s sustainable. And what will happen in a lot of those instances is they get paid, like, let’s just say, a day rate. So then if the you know, it’s kind of like a bus route, is how I see it, this is how it goes every day. And if there’s a load or not, they’re still going to be running it because they’re getting paid a day rate. And yes, that could cause some losses on the on, you know, the shipper side, but then they’re going to recoup that, because if there’s not a load that day, you know, it’s it’s cheaper, because the resources you’re saving, the service you’re getting, the time you’re getting back from continually finding new carriers for those lanes, and the carriers love it, and they usually will grow based on that business. So, you know, we, we had one kind of round trip. We started with one guy. He had like three trucks. He has now grown to he he bought like 15 more trucks, and he’s running this like times 10. And you know, they the carriers, and will grow to learn the warehouses. Understand their operations. They know the they know Tommy that she can check them in. They know everything they need to know. And so it really suppresses a lot of the pain points for carriers and shippers and brokers, and it’s should hopefully run as a smooth machine, not a lot of touches, which then goes back to brokerages looking to figure out how they can sustain their Business with thin margins and not have all of the overhead and the cost that a brokerage passed

Abby and Abby and let me ask you so Earlier we touched on supply chain being more resilient. We had Craig fuller on our show a while back, and he was actually in Cartagena as well when in the in the conference, and he talked a lot about how there’s a lot of shifts in in supply chain for, like, geopolitical, environmental, you know, like, like the Panama Canal theme that happened, and then economic, or whatever, whatever might might affect the supply chain. And we’re seeing a lot more nearshoring, and not your kind of nearshoring, because you’re, you’re kind of near shoring is more men, you know, like back office and and not manufacturing. So talking about near shoring for manufacturing companies moving into Mexico, Colombia, like you said, even Central and South America to be closer to the United States. How do you see like, some of those transportation logistics like, Are your customers seeing that shift more like, now we have more a lot more land. Shipments versus ocean, you know, like, what do you see in the trends on that? You know, Craig alluded to it, but this was back in November, October, when we interviewed him. I’m just kind of curious to see how that might have evolved since then, you know. And if you and your clients have seen any of that as well because of all those shifts.

Yeah, I it’s been a huge focus in our industry, and specifically because, you know, when you’re looking at over the road domestic transportation, a lot of companies steer away from going into Mexico because it we’ve heard of, you know, nightmare stories that trailers getting their rims stolen and you know, like, it’s a huge liability. So not a lot of companies have put in the effort to really make relationships and connections in Mexico that they can trust to be able to run freight across border for them, but that is a huge push right now in our industry. And I, I’ve been talking to a couple of shipper partners, you know, Constellation Brands, a lot of these companies that have already been doing a lot of cross border and have operations in Mexico. And it’s been, you know, it’s been a big, a big challenge, for sure. And so I think a lot of companies are trying to capitalize on that right now and figure out how they can better support Mexico operations for their shipper partners. And I think that’s a big selling point as well for potential package deals for like domestic freight and cross border freight, if they can have a solution for that. And, you know, I remember when there was all those

border issues and trains were shut down. It was a, it was very, a huge pain point for a lot of those shippers, because then a lot of this freight that was running on the rail before. Well, now the rail lines are shut down. They had to move it over to dry vans and find eruptible carriers to be able to cross border that freight and go to different locations in Mexico that they may not have been very comfortable going to and figuring out the best way to be efficient and optimize the connections and routes in within Mexico. So as more companies are moving their manufacturing operations down in Mexico, I think there’s going to be a lot more a tech platforms. You know, your Matt Silvers platform that does, does that like kind of looks at cross border operations. I think there’s going to be more of those coming into play, and I think it’s going to be a huge focus in the future of our industry.

Excellent. Well, I will say we’re going to need to wrap this up, because we could get in and keep talking is like, I love this, because the other scenario here is like, as you were talking about some of the margins that people are having to deal with, and the repercussions thereof, and what the future holds. I mean, we’ve got an election coming up that’s going to play havoc on the markets and the economy and different things like that, and depending on who wins and what the expectations are, and some of the other impacts of, you know, the geopolitical tensions as well as geographics, such as the drought in Panama through the Panama Canal and all that. And hopefully it is getting more rain. There’s talks of that, but it’s still they are so short on that. So the frequency of ships coming through there affects then the ports and the trucks thereof, and the port congestion, etc. So how to deal with all that’s gonna be another thing. Abby, I will just ask. One other thing, though, is if somebody is interested in trying to improve their operations or their margins and things of that nature, you know, is that something, what kind of information would if they were to reach out to you, what you know as a preliminary here, what would they need to pull together to make it a more productive? Initial meeting with you.

So for me, I really love to understand your operations. You know, are you operating in a First I start with sales. Are you cradle to grave, where your people are landing the business and then managing that business and trying to grow the business? Or is it more of a style where it’s sales and customer service and operations are split? Because I think there’s a lot of ways to create optimization and efficiencies within an organization. So I really want to understand if the organization knows their cost of operating because that’s the first thing I have people look at, is, what are your operating costs? You know, I talk to companies all the time where it’s like, well, we have 20 branches. There’s five people in this office, five people here, 20 people here, so and so, people here, and then their account managers are doing all aspects of the operations. They’re tracking and tracing. They’re booking the loads. They’re trying to get new freight from a customer. They’re then going to deal with retention and POV retrieval and all these things. And I think if you’re an organization figuring out how you can take some of those entry level roles and again, either automate or outsource those to be able to keep your revenue generator, generators in the US and your sales people still going out and trying to land new business, and keeping their pipeline in check, and creating those relationships, deeper relationships, with your customer partners, to create that stickiness, so that no matter what happens in the industry, all the volatilities, the you know, like you mentioned, the labor shortages, the rise of E com, the presidential election, you know, issues still after covid, and the volumes, all of that can be talked through through a relationship. You have that strong relationship and are sticky, so figuring out how to insert yourself in multiple different areas within a customer relationship, and then looking back in your into your operations, and figuring out where you can kind of skim from the top. You know, brokerage model is not as profitable as it once was, so we really need to reassess the workload and figure out, okay, you know, are these entry level track and trace employees really as productive as they can be, and why would we not? You know, look at near shoring to fill these positions, save our

some of our labor costs by 40% and still keep our heavy hitters on the front lines. So I think that is something that a lot of companies need to look at, and then obviously down the road, automation and tech take a long time to implement and a lot of money as well, so but I do think that’s going to be a huge push for a lot of organizations to be able to stay in the mix and be profitable.

Well, to have a it or a system strategy, I mean literally, you need to have a plan. Yeah, you can have and you don’t always need to go for the latest greatest either. But it’s like certain things as you identify it. Don’t try and take a shotgun approach for trying to do everything all at once, taking, you know, more of the Sharpshooter. What’s your strategy? This particular segment of the functions could be automated if we implement something and but have a phased approach. Don’t do it hodgepodge. But, you know, we can start here. Here’s the next one and all that. But look at that and plan that out. A lot of good planning ahead of time, and discussions with, you know, like you’re saying or having those discussions, and then, you know, working with your clients and developing that kind of stuff to where it’s like this works. Here’s your stepping stone to you know, from one step, 12345, on down the road that will definitely, in the long run, give you the margins you’re looking for more consistently, and help avoid the ups and downs

absolutely and also partnering with tech companies to help better assess productivity and and your workforce. So, like, you know, I just got introduced to ISO, and what they really do is kind of put a scorecard to your operations. And that’s warehouse, you know, you could be a warehouse. You could be a freight broker. You could be an asset company, or like avrl, who is integrating your spot operations into directly into the shippers operations without API. Or, you know, you look at, I have a couple others, manifold freight is starting, and they are compiling all you might have 30 different load boards that you’re looking at all day, well that is super inefficient, so what they’re doing is combining all those and integrating it into one platform. So looking at solutions like those to better create efficiencies, I feel like I’ve said that a million times, but it really is the true like important part of the transformation in our industry right now is, how can we create efficiencies, optimize results, get the most out of your the US employees and collaborate with companies to help uncover, you know, missed opportunities or areas that should be able to create better margins with less work. So I do feel like that’s and obviously then near shoring as well and figuring out how to move some of those tasks to others that can have that same productivity at a lower cost.

I appreciate you coming on and giving you given some insights here. I think we would love to have you back and get into a little bit more detail, specifically on some issues, on what people can do, kind of a more advanced in a in narrow the focus, but love that. Appreciate you. Abby, it, it’s excellent. It’s like, it’s there’s never a dull moment in this industry. I mean, things are changing so much and and it’d be interesting to see what you thought we’ll think about as far as this election year, and what will happen depending on who gets elected and what happens after that. So being,

yeah, it’s always, you know, it’s always kind of a and that’s another thing I think a lot of companies forget to look at that, and forget to look at kind of the broader aspect of what is going going on in the world, and not just this little transportation world, you know, because it does have a big effect on the companies and how they operate. So, yeah, I’d love to get in that on our next on our next chat. I would love to be there. Well,

folks, we hope that you’ve enjoyed today’s discussion. Lalo, we’ll have Abby’s contact information with her company and all that with our show notes. Any last comments,

none of my end Abby, do you want to have anything in closing? But I’m good right now, but thank you for coming on our show. No,

I really appreciate you guys having me on, and can’t wait for the next time.

Well, folks, we appreciate you with the simply trade podcast. Like us, share us. We appreciate your listenership, and with that, Y’all have a great day.