Fleet Management News & Business Info | Commercial Carrier Journal
Issue link: http://read.dmtmag.com/i/667099
commercial carrier journal | april 2016 43 The evolution of the middleman Reliable pricing, e-commerce lead the way W hen Robert Nathan was 14, he was creating paper manifests and loading freight onto trucks at a warehouse owned by his father. After grad- uating from college, he started his career at a large freight brokerage firm. The job involved a lot of phone calls and faxes and seemed nearly as manual as sorting freight at the warehouse. "I was amazed at the inefficiencies and lack of innovation, not just within the organization but in the industry," says Nathan, who saw an opportunity and co-founded Load Delivered in 2008. In 2015, the Chicago-based third-party logistics firm's revenues were about $82.5 million. This year, the company moved to a new office building in Chicago's technology epicenter to begin its next growth stage. Nathan, its 34-year-old chief executive, plans to grow revenues from $100 million in 2016 (project- ed) to $1 billion with a staff of fewer than 500. "The only way to do that is with technology," he says. The 3PLs with $1 billion in revenues today have about 1,500 employ- ees, while Load Delivered currently has 91, he says. The company has an Innovation Department with a team of 15 employees focused on developing new applications and integrating systems. The department is working on solutions for what Nathan believes will be a "very large" capacity crunch in 2017 when enforcement kicks in for the electronic logging device rule. On the upside, ELDs in more trucks will mean more connec- tivity to third parties such as Load Delivered. In advance of the capacity crunch, the company is investing to improve its carrier interfaces to source capacity and track freight. First things first Some companies have developed software designed to provide instant bookable rates to shippers with less-than-truckload and truckload freight moves. The user experience of these websites and apps appears to be nearly as easy as booking a ride with Uber or purchasing a flight and reserving a hotel with Travelocity. While Nathan respects the technology of these startups, he be- lieves an Uber-like experience for moving freight may be feasible only in large markets with a lot of freight density and capacity, such as Southern California or New York City. "In our industry, it is so complex to create one piece of technol- ogy that will do everything," he says. "There are so many different processes within each individual function." Freight brokers and 3PLs that can provide customers and prospects with instant reliable pricing will be leading the next evolution of growth for the next few years, he says. Competing with Amazon E-commerce is another area where transportation and logistics are becoming extremely competitive and where middlemen are gaining ground. The market leader, Amazon, is taking bold steps and making it difficult for others to keep up. Over the past year, Load Delivered has worked to become more than a freight brokerage provider by adding supply chain engineering, omnichannel delivery and a higher level of managed transportation services to its portfolio. Load Delivered fulfills online orders of LTL-sized freight, such as outdoor furniture, for omnichannel retailers that spend between $3 million and $10 million in transportation annu- ally; these companies often are looking to outsource logistics. MAKING THE LATEST TECHNOLOGY DEVELOPMENTS WORK FOR YOUR FLEET BY AARON HUFF technology ELECTRONIC LOGS: Capacity crunch may result when ELD enforcement begins in 2017. CARRIER INTERFACES: Load Delivered is investing to source capacity and track freight. E-COMPETITION: E-commerce is another area where the middleman is gaining ground. AARON HUFF is Senior Editor of Commercial Carrier Journal. E-mail ahuff@ccjmagazine.com or call 385-225-9472. Load Delivered's Innovation De- partment focuses on creating new technologies that add value for its customers.