SPECIAL REPORT
The Top 20 3PLs
in North America
North American third-party logistics has been a growth business since its inception in the late 1980s. The cumulative annual growth rate from 1996 through 2003 was 14%. Armstrong & Associates estimates 3PL revenues for North America to be $104 billion (US). International transportation management which includes freight forwarding and cross border transportation management accounts for $39 billion. Value added warehousing/distribution is the second largest category.
By Richard Armstrong
A convergence of interest in global supply chain management, new technologies like RFID for controlling inventory costs and modest economic growth are fueling 3PL outsourcing. At the same time, 3PLs are evolving quickly to provide the information technology base and transportation execution base to make longer supply chains work.
Customers of 3PLs are expected to be less inclined to pay for and build in-house “non-core” solutions given the outsourced logistics options available. 3PLs have ready-to-implement solutions which can restore competitive balance for companies slipping behind. For example, Wal-Mart has shown the importance of competitive supply chain control. Its competitors have to match the pace.
The current situation in consumer-oriented verticals is analogous to the changes American automakers had to address in the 1980s. To remain competitive with Japanese automakers, U.S.-based auto companies had instituted JIT manufacturing complete with inbound supply chain control. Other industries followed suit.
These industrial changes were major opportunities for Ryder, Penske and other companies in our Top 20 3PLs. These same companies are adapting quickly now to accommodate the supply chains for retailing, fast moving consumer goods, computer equipment and other verticals.
From a North American perspective, the extensive trade between Canada, Mexico and the U.S. is the platform for the Top 20. For example, 85% of Canada’s exports are to the U.S.; 73% of its imports are from the U.S. Numbers for U.S. – Mexico trade are similar. Of further importance, Mexico and Canada supply about one-third of U.S. petroleum. The interdependency of these three economies virtually guarantees that opportunities will continue to increase for 3PLs serving all of North America. This is particularly true for the automotive, paper products, chemicals and industrial verticals.
The major competitors are similar in Mexico, the U.S. and Canada. Most of our Top 20 have offices in all three countries. Exel, the world’s largest 3PL, has 45 locations in Mexico, 20 in Canada and over 200 in the U.S. TNT has 39 in Canada, 4 in Mexico and 118 in the U.S. All of our Top 20 are heavily involved in cross-border traffic.
The greatest impediments to an even faster expansion in North American logistics activity are at the Mexico-US border. Mexico-US trade has increased three fold since NAFTA was initiated in 1993 but Mexican customs has not kept pace. The customs clearance process at Laredo and other key points involves substantial and unnecessary re-handling. A second major problem is the limited cross border movement of trucks from both countries. The parochial interests of two groups, Mexican customs brokers and US trucking companies need to be overcome. These needed changes have become more urgent because they limit North American trade competitiveness in relation to Chinese manufacturing and trade practices.
The biggest North American 3PL event this year was Exel’s purchase of Tibbett & Britten. Tibbett & Britten was the largest Canada-based 3PL in terms of revenue. However, its business model did not allow for significant profitability despite its top-line growth. As a result, the new executive offices are in New Jersey. One of Tibbett & Britten’s financial miss-steps was its acquisition of DiMalsa in 2002. DiMalsa was the largest Mexico-based 3PL but not up to modern industrialized standards. Tibbett & Britten was forced to close many inefficient, small warehouses and consolidate operations. A major challenge for the new owner will be to incorporate and make profitable the remaining DiMalsa operations.
Unlike Tibbett & Britten, Mexico has not been a negative operating experience for all 3PLs. Kuehne & Nagel acquired a series of well-run, modern operations with its USCO purchase. Penske, Ryder and other 3PLs with automotive logistics operations, have found Mexico to be profitable and attractive. For these same companies, profitability is more elusive in Canada.
Our Top 20 list excludes some very good 3PLs like Progistix, which operates primarily in only one country. Our Top 20 all have coverage in domestic and international transportation management. All either own or control extensive trucking capacity through brokerage and freight forwarding. That trucking capacity is the life blood of the North American economy, especially on North-South routes.
Because of the importance of trucking capacity, we have included major dedicated contract carriers in our Top 20. In addition to their transportation execution and planning capabilities, most the top 3PLs are heavily involved in value-added warehousing. Exel and UPS SCS lead in this area. Exel is the world’s largest 3PL – UPS is the largest North America-based 3PL. The two will compete even more heavily in the years ahead.
Armstrong & Associates Inc. is a supply-chain management consulting firm specializing in market research, mergers and acquisitions and outsourcing. Armstrong & Associates publishes “Who’s Who In Logistics? Armstrong’s Guide to Global Supply Chain management”. Recent research papers include Warehousing in the United States and Global Logistics Services Providers II. In addition, Armstrong & Associates maintains databases of warehousemen, freight forwarders and third-party logistics and distributing companies. Armstrong & Associates, Inc., 100 business Park Circle, Suite 202, Stoughton, WI 53589; Phone: 608-873-8929; Fax: 608-873-5509; Website: www.3PLogistics.com.
Listing of Top 20 3PLs
On this page:
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| UPS Supply Chain Solutions – Atlanta, GA NYSE: UPS (United Parcel Service) 866-822-5336 Bob Stoffel, President www.ups-scs.com |
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3PL Turnover:
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North America: $4.1b Global: $33.5b | |
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Service Area:
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Service to 99% of World GDP; NA locations: 50 U.S., 20 Canada, 10 Mexico | |
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3PL Assets:
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22,000 employees 550 warehouses 1,100 tractors, 2,425 trailers |
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Information Systems:
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Excellent TMS – i2, Roadnet, UPS Tracking WMS – operates all major systems |
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Services:
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Air and ocean freight forwarding, customs brokerage, transportation management, warehousing and distribution, supply chain consulting, dedicated contract |
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Industry Focus/Key Customers:
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Armstrong & Associates’ Evaluation:
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| Exel Americas – Westerville, OH London: EXL 800-272-1052 Bruce Edwards, President-NA & CEO www.exel.com |
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3PL Turnover:
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North America: $3.9b Global: $11.2b | |
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Service Area:
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Service to over 95% of World GDP; NA locations: 200+ U.S., 20 Canada, 45 Mexico | |
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3PL Assets:
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109,000 employees 700 Warehouses 10,000 tractors, 16,000 trailers |
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Information Systems:
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Very good TMS – G-Log, i2, Red Prairie WMS – HK Systems, Topex, Insight, Red Prairie and others |
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Services:
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Warehousing and distribution (contract logistics), air and ocean freight forwarding, supply chain consulting, customs brokerage, transportation management, returns management, home delivery | |
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Industry Focus/Key Customers:
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Consumer goods, retail, computers and electronics, automotive, chemical, healthcare Key Customers: Adolph Coors Co., Alberto Liquor & Gaming, Apple Computer, BP, Colgate Palmolive, Compaq, Daewoo, Dillon Companies, Ford Motor Co., Furr’s Supermarkets, Hewlett-Packard, Home Depot, Honda, Intel, International Paper, King Soopers, Kodak, Maxtor, Miller Brewing, Mitsubishi Corp., Motorola, Nissan, Owens Corning, Pepsi Americas, PPG, Procter & Gamble, SC Johnson, Shell, Sony, Sun Microsystems, Unilever Bestfoods, Wal-Mart, Xerox |
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Armstrong & Associates’ Evaluation:
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Exel is the world’s largest pure 3PL. It has grown dramatically over the last few years due to mergers. This year Exel purchased fellow British-based Tibbett & Britten, increasing its turnover by 26%. Tibbett & Britten had large but unprofitable North American operations with an emphasis on large grocery and retail distribution centers. In 2000, Exel merged MSAS, a major freight forwarder with its contract logistics operations. This merger dramatically expanded Exel’s global supply chain management capabilities. Cross-selling opportunities have been exploited as part of Exel’s emphasis on the Global 250. North American transportation operations were unprofitable in FY 2003, but steps are being taken to correct the problem. Exel Transportation (Mark 7) is the second largest freight broker in North America. It has 120 offices in the U.S., Canada and Mexico. Exel Home Direct is a solidly profitable last-mile delivery service. Exel has a host of solid operations with varied functionality around the globe. Coverage is provided for all major verticals. Revenues are evenly divided between transportation management and contract logistics operations. MSAS continues as one of the largest air freight forwarders. CEO John Allen expects improved profit margins through synergistic cost savings. | |
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| C.H. Robinson Worldwide – Eden Prairie, MN NASDAQ: CHRW 952-937-8500 John Wiehoff, CEO www.chrobinson.com |
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3PL Turnover:
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North America: $3.6b | |
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Service Area:
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North America, Europe, Brazil; NA locations: 134 U.S., 5 Canada, 4 Mexico | |
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3PL Assets:
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4,100 employees 100 warehouses and crossdock affiliates |
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Information Systems:
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Very Good TMS – Express WMS – High Jump |
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Services:
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Freight brokerage, air and ocean freight forwarding, transportation management, warehousing, print logistics | |
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Industry Focus/Key Customers:
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Technology, food and beverage, retail, paper products and printed materials, agriculture, consumer goods Key Customers: Amstar, Anchor Glass, Anheuser-Busch, AOL, Ball Foster Glass, Beatrice/Hunt Wesson, Best Buy, Cargill, Clorox, Dana Corp, International Paper, Wal-Mart |
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Armstrong & Associates’ Evaluation:
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CHRL has a flexible, flat organization, and most operating decisions are made on a local level. It has been a very profitable operation for a long time. Net after-tax margins are consistently more than 15% of net revenues. CHRL has a talented top management team, featuring 40-year-olds like John Wiehoff as CEO, mixed with founder and chairman Syd Verdoon. Robinson’s core business is a multi-faceted 3PL and freight broker providing North American trucking and intermodal services. Many operations are food and temperature related; 60% of revenues are food and beverage related. 70% of revenues are from freight brokerage. It has a history of designing unique, efficient consumer response and supply chain management processes. It re-engineers its capabilities to capitalize on unique supply chain requirements of customers. CHRL has a background in handling perishable, time-sensitive commodities. CHRL’s software has been redesigned to emphasize a detailed order management system linked to transportation execution. Robinson’s LTL transportation website approach provides a significant consolidation and cost saving methodology. About 12,000 shipments per day are handled through Robinson’s website. Most of Robinson’s warehouse space is leased or involves the use of subcontractors. | |
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| Menlo Worldwide – Redwood City, CA NYSE: CNF 650-596-4000 John Williford, President & CEO www.menloworldwide.com |
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3PL Turnover:
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North America: $2.96b Parent Revenue: $5.6b | |
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Service Area:
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Americas, Asia, Europe; NA locations: 380 U.S., 32 Canada, 17 Mexico | |
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3PL Assets:
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16,500 employees 125 warehouses 180 tractors, 900 trailers |
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Information Systems:
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Excellent TMS – TTMS, LMS WMS – WMS (Provia-modified) |
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Services:
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Transportation management, warehousing and distribution, air freight forwarding, customs brokerage, supply chain consulting, returns management and expedited | |
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Industry Focus/Key Customers:
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Computers and electronics, chemicals, retail, beverage Key Customers: AT&T, Electrolux, Dow Chemical, Dr. Pepper/Seven-Up, HALO Branded Products, Hewlett-Packard, IBM, NCR, Nike, Nortel Networks, Ricoh Family Group, Sears, Stanley Works, Takara |
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Armstrong & Associates’ Evaluation:
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Menlo is one of the leading U.S.-based logistics companies. It has solid inbound supply chain management and good finished goods distribution management. Its LMS solution makes it a good transportation and supply chain manager. Interfaces to SAP have been made at HP and other companies. A firm toehold has been established in European logistics. Menlo Worldwide (Emery) Logistics’ freight forwarding company adds a host of customers and forwarding, particularly of airfreight. It continues to operate in the red, however, negatively affecting overall CNF results. Vector SCM, its successful joint venture with GM and lead logistics IT, now has revenues of $18 million per year. |
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| Expeditors International of Washington – Seattle, WA NASDAQ: EXPD 206-674-3400 Peter Rose, CEO & Chairman www.expeditors.com |
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3PL Turnover:
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$2.6b | |
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Service Area:
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Asia, Americas, Europe; NA locations: 46 U.S., 5 Canada, 7 Mexico | |
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3PL Assets:
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8,000 employees 149 warehouses |
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Information Systems:
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Good TMS – Tradeflow, SNEP, Exp.0 |
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Services:
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Air freight forwarding, customs brokerage, transportation management, warehousing and distribution, supply chain consulting | |
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Industry Focus/Key Customers:
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Automotive, electronics, retail, chemicals, healthcare Key Customers: Ace Hardware, Costco, Ford, General Motors, Motorola, Toyota, Trane |
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Armstrong & Associates’ Evaluation:
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Expeditors is a very profitable freight forwarder with a strong base in China and Asia. It is run by the most entertaining logistics CEO, Peter Rose, who is candid and satirical. As evidence that he has his head screwed on straight, Rose never lost sight as a freight forwarder on turning good margins on purchased transportation. Operational quality is highly valued and Rose has surrounded himself with a good team. Expeditors is tied into an organic growth strategy that may not be sustainable over the long haul, but works well now. | |
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| Penske Logistics – Reading, PA 610-775-8285 Vince Hartnett, President www.penskelogistics.com |
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3PL Turnover:
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$2.5b | |
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Service Area:
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North America, Europe, Brazil; NA locations: 130 U.S., 5 Canada, 10 Mexico | |
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3PL Assets:
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9,700 employees 134 warehouses 3,190 tractors, 6,723 trailers |
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Information Systems:
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Very good TMS – LMS, i2, proprietary WMS – EXE, RT Systems, MARC, proprietary |
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Services:
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Dedicated contract carriage, transportation management, supply chain consulting, warehousing and distribution, equipment leasing | |
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Industry Focus/Key Customers:
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Automotive, retail, food, appliances, utilities Key Customers: Amcor Sunclipse, Baxter Healthcare, Carrefour, Ford Motor Co., GE Medical, Iams, International Truck and Engine, Knoll, Mission Foods, Panasonic, Whirlpool Corp |
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Armstrong & Associates’ Evaluation:
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Penske Logistics’ strongest operations are related to the automotive industry. These operations constitute about 50% of Penske Logistics’ business. Penske often functions as a lead logistics provider. Dedicated contract carriage is a strength as is its transportation routing center. Penske has been a beta test site for i2 innovations. Penske has done well at implementing business expansion plans. Penske’s successes with Saturn and Ford show the muscle of its marketing and automotive logistics abilities. Penske’s European operations include eleven supply chain customers, warehousing, crossdocking and trucking. The operation is headquartered in Roosendaal. Brazilian operations involve eight customers in Sao Paulo and Vitoria. Penske’s Europe TMS center is based in Maastricht. Penske will add significant new operations in Asia this year. 79% of Penske is owned by GE Capital. | |
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| Eagle Global Logistics – Houston, TX NASDAQ: EAGL 800-888-4949 Jim Crane, President & CEO www.eaglegl.com |
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3PL Turnover:
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$2.2b | |
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Service Area:
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Asia, United States, Europe; NA locations: 80 U.S., 8 Canada, 9 Mexico | |
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3PL Assets:
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8,000 employees 87 warehouses, 400 service centers |
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Information Systems:
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Good TMS – proprietary WMS – proprietary |
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Services:
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Air and ocean freight forwarding, transportation management, warehousing and distribution, customs brokerage, expedited, project management | |
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Industry Focus/Key Customers:
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Automotive, aerospace, trade shows, telecommunications, computers and electronics, pharmaceuticals, printed materials, oil and gas, apparel and entertainment equipment Key Customers: Amdahl, Neiman Marcus, Proctor & Gamble, Visteon Corp., U.S. Military Traffic Management Command |
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Armstrong & Associates’ Evaluation:
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Eagle has returned to profitability after taking three years to absorb Circle International. During the same period, Eagle has adjusted to the changing U.S. market by putting more time-definite freight on trucks. Major verticals for Eagle are manufacturing/telecom, high-tech, aerospace and fashion/retail. Eagle has been heavily involved in transportation to U.S. forces in Iraq. Eagle’s revenues are 40% air export, 12% air imports, 14% ocean, 8% logistics, 19% domestic ground, 6% local pickup and delivery and crossborder. 48% of revenues are from North American operations. | |
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| Schenker, Inc. – Freeport, NY 516-377-3000 Heiner Murmann, President & CEO www.schenkerusa.com |
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3PL Turnover:
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North America: $2.1b Global: $19.5b | |
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Service Area:
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Europe, Asia, South America, Africa, North America; NA locations: 50 U.S, 6 Canada, 3 Mexico | |
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3PL Assets:
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36,000 employees 405 warehouses |
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Information Systems:
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Good TMS – SWORD, Procars, ILS WMS – HTS, SAP R/3, SoLiNet |
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Services:
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Air and ocean freight forwarding, customs brokerage, warehousing and distribution, transportation management | |
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Industry Focus/Key Customers:
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Automotive, computers and electronics, consumer goods, healthcare Key Customers: BMW, DaimlerChrysler, Dupont, Ford, Hewlett Packard, IBM, Intel, Procter & Gamble, Subaru, Unilever, Volkswagen |
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Armstrong & Associates’ Evaluation:
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Schenker is a German industry giant with logistics management capabilities. Schenker is part of Stinnes Logistics, a large German conglomerate (over $11 billion in sales) involved in oil trading, raw materials, steel and other operations. The German Railway purchases Stinnes/Schenker in 2002. Schenker is a key transportation and distribution company in Europe but not a major player in the United States. In the fall of 1998, Schenker re-designed its operations to create Schenker Logistics. CEO Murmann was educated in Canada and is not yet 40 years old. He has begun to make significant expansions in the U.S., opening new contract logistics operations and purchasing CCW. Canadian operations are very good and Murmann is moving U.S. operations to the same level. The corporate preference is to build shared networks globally. Most recent purchases have been made in Scandinavia, France and Poland, strengthening overall European operations. | |
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| Ryder – Miami, FL NYSE: R 305-500-3726 Gregory Swienton, President & CEO www.ryder.com |
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3PL Turnover:
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North America: $1.9b Global: $4.8b | |
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Service Area:
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North America; NA Locations: 150+ U.S., 35 Canada, 7 Mexico | |
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3PL Assets:
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16,500 employees 184 warehouses 48,800 tractors, 44,800 trailers |
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Information Systems:
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Good TMS – Dedicated Systems, i2, JIT, Capstar WMS – V3, PkMS |
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Services:
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Supply chain consulting, transportation management, warehousing and distribution, dedicated contract carriage, air and ocean freight forwarding, equipment leasing, returns management, freight payment and auditing, insurance | |
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Industry Focus/Key Customers:
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Automotive, aerospace, industrial, telecommunications, computer and electronics, food and beverage, pharmaceuticals, building materials, utilities, consumer products and retail, newspaper distribution Key Customers: Applied Materials, Cadbury Schweppes, Caroline Power & Light, Coca Cola, DaimlerChrysler, Dallas Morning News, General Motors, Philips Consumer Electronics, Visteon Corp. |
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Armstrong & Associates’ Evaluation:
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Ryder has traditionally been the most recognized brand name in North American logistics. For two decades Ryder has been one of the largest U.S. providers of dedicated contract carriage, often converting leasing customers to expanded service. Ryder’s dedicated operations average 15 trucks each and Ryder is a particularly good choice for small, stand-alone replacements. In recent years Ryder has expanded its inbound supply chain management and distribution management capabilities. Greg Swienton’s team has forced Ryder SCS into the black. Ryder’s established position across many verticals in North America makes it an attractive takeover candidate. | |
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| Kuehne & Nagel, Inc. – Jersey City, NJ SWX: KNIN 201-413-5500 Rolf Altorfer, President-NA www.kuehne-nagel.com |
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3PL Turnover:
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North America: $1.8b Global Revenue: $6.9b | |
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Service Area:
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Service to over 85% of World GDP; NA locations: 46 U.S., 19 Canada, 4 Mexico | |
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3PL Assets:
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20,000 employees 50 warehouses |
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Information Systems:
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Very good TMS – G-Log, CIEL 4000, KN Road, i2 WMS – EXCEED |
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Services:
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Ocean and air freight forwarding, value-added warehousing and distribution, transportation management, customs brokerage, supply chain management | |
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Industry Focus/Key Customers:
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Automotive, industrial, healthcare, high-tech, retail/consumer products Key Customers: Dupont, Nortel, Siemens, Memorex, Harman, Dana |
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Armstrong & Associates’ Evaluation:
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Kuehne & Nagel is a well run, transparent Swiss company with consistently good financial results. It is the world’s largest ocean freight forwarder, handling over 900,000 TEUs per year. It is also one of the top five airfreight carriers. Kuehne & Nagel has ISO 9001 certification for all of its company locations. Recent acquisitions were designed to broaden contract logistics capabilities. These acquisitions give Kuehne & Nagel much better North American and Asian coverage. Contract logistics has retuned to profitability in FY 2004. Primary contract logistics emphasis is on pharmaceuticals and high-tech. | |
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| Hub Group – Downers Grove, Il NASDAQ: HUBG 800-964-2515 David Yeager, Vice Chairman & CEO www.hubgroup.com |
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3PL Turnover:
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$1.4b | |
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Service Area:
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North America; NA locations: 21 U.S., 1 Canada, 1 Mexico | |
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3PL Assets:
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1,200 employees 300 tractors |
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Information Systems:
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Good TM – i2, Sabre |
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Services:
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Intermodal, truck brokerage, rail car management, value-added warehousing/distribution | |
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Industry Focus/Key Customers:
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Building materials, computers and electronics, consumer goods, retailing, healthcare, food and groceries Key Customers: Georgia Pacific, Hewlett Packard, Kraft Foods, Matsushita Electric, Nabisco, Pfizer, Philip Morris, Sears, Staples, Unilever, United Natural Foods |
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Armstrong & Associates’ Evaluation:
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Hub Group is a major North American intermodal management company. It provides a range of transportation solutions and contract logistics. Intermodal transportation is given preference because of cost unless time constraints require highway transportation. Mexican service is handled through a partnership with TMM. Hub’s top management is respected for its candor. | |
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| Schneider Logistics/Dedicated – Green Bay, WI 800-525-9358 Tom Escott, President-Logistics www.schneiderlogistics.com |
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3PL Turnover:
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North America: $107m/$1.2b Parent: $2.9b | |
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Service Area:
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North America, Europe; NA locations: 40 U.S., 3 Canada, 3 Mexico | |
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3PL Assets:
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15,200 employees 14,000 tractors, 51,000 trailers |
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Information Systems:
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Excellent TMS – SUMIT |
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Services:
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Transportation management, freight brokerage, supply chain consulting, dedicated contract carriage, freight payment and auditing | |
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Industry Focus/Key Customers:
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Consumer products and retail, automotive, heavy equipment, computers and electronics, food and beverage, chemicals, healthcare, paper Key Customers: 3M, Anheuser Busch, Baxter Healthcare, CHN Corp., DaimlerChrysler, Dow Chemical, Fort James, General Motors, Georgia Pacific, Guardian Glass, Honda, Kimberly-Clark, Kroger, Nabisco, Ocean Spray, PPG Industries, Thomson Multimedia, TRW, World Kitchen |
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Armstrong & Associates’ Evaluation:
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Schneider Dedicated is the largest dedicated contract carrier relying for the most part on dedicated capacity and SUMIT technology to take care of customers. Schneider’s emphasis is on large dedicated opportunities. Escott is significantly expanding brokerage services which offer opportunities for better margins than IT-based transportation management. Schneider is a premier automotive logistics transportation management company. Schneider has built a multi-client network for automotive parts distribution. In the 1990s, Schneider developed the SUMIT suite of transportation management, logistics and supply chain execution applications. SUMIT utilizes SSP (Schneider Shipment Planner) for optimization of consolidation, carrier selection and routing. Schneider Logistics (SLI) transportation optimization software has been one of the best in the 3PL industry. SLI has a large network of carriers in all modes of transportation. Schneider is one of the largest customers for FedEx Express. Including its freight bill payment service, SLI has $7 billion in freight bill payments annually. | |
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| J.B. Hunt Dedicated Services – Lowell, AR NASDAQ: JBHT 800-643-3622 John Roberts III, President www.jbhunt.com |
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3PL Turnover:
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North America: $712m Parent: $2.6b | |
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Service Area:
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North America; NA locations: 300 U.S., 2 Canada, 2 Mexico | |
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3PL Assets:
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5,400 employees 20 terminals 4,800 tractors, 11,000 trailers |
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Information Systems:
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Good TMS – Scenario Pro WMS – Scenario Pro |
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Services:
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Dedicated contract carriage, IMC | |
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Industry Focus/Key Customers:
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Food and beverage, retail, building materials, paper Key Customers: Anheuser Busch, Circuit City, Family Dollar, Georgia, Pacific, Home Depot, Office Depot, PPG Industries, Target, Wal-Mart, Weyerhaeuser |
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Armstrong & Associates’ Evaluation:
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J.B. Hunt Dedicated Services continues to grow. Operating ratios are in the lower 90s. J.B. Hunt has over 300 dedicated contract carriage customers. A significant part of Hunt’s dedicated operations involve direct store delivery. | |
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| TNT Logistics North America – Jacksonville, FL Netherlands: TP 888-LOGISTX Jeff Hurley, Managing Director/COO www.tnt.com |
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3PL Turnover:
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North America: $703m Global: $14.8b | |
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Service Area:
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Europe, Americas, Asia; NA locations: 118 U.S., 39 Canada, 4 Mexico | |
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3PL Assets:
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40,000 employees 357 warehouses |
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Information Systems:
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Very good TMS – i2, Vector 21, Reply WMS – JDEdwards, MA, LIS, Reply, MARC |
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Services:
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Manufacturing support and subassembly, transportation management, supply chain consulting, dedicated contract carriage, warehousing and distribution, returns management | |
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Industry Focus/Key Customers:
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Automotive, electronics, rail, tire, consumer goods, utilities, heavy machinery Key Customers: Andersen Corp., BMW, Compaq, CSX, DaimlerChrysler, Fiat, Ford, General Motors, Goodyear, Home Depot, Honda, NACCO Materials Handling Group, Sears |
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Armstrong & Associates’ Evaluation:
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TNT is the world’s largest automotive logistics 3PL. It is a master of value-added warehousing and manufacturing support. Expansion of its services in Asia and standardization of operating procedures, including IT, are on the front burner. Logistics and express divisions are being trained to work as one. TNT’s recent acquisition of Wilson Logistics expands its freight forwarding and contract logistics capabilities. Parent TPG, which operates the Dutch postal service, generates large free cash flows. A further investment in freight forwarding, especially with an Asia base, would not be surprising. | |
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| BAX Global – Irvine, CA NYSE: BCO (The Brink’s Company) 404-768-2003 Joseph L. Carnes, President www.baxglobal.com |
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3PL Turnover:
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North America: $638m Global Revenue: $4b | |
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Service Area:
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Asia, North America, United Kingdom; NA locations: 100+ U.S., 12 Canada, 7 Mexico | |
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3PL Assets:
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10,000 employees 48 warehouses 35 aircraft |
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Information Systems:
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Very good TMS – CAPS, i2, BAX Suite WMS – EXE, Ultramain |
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Services:
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Air freight forwarding, transportation management, warehousing and distribution, supply chain consulting, freight payment and auditing, customs brokerage | |
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Industry Focus/Key Customers:
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Computers and electronics, automotive, aerospace, airlines, healthcare, retail Key Customers: Airbus, Boeing, Bombardier, Epson, GE Medical Systems, Microsoft, NEC, Philips Consumer Electronics, Raytheon, Subaru |
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Armstrong & Associates’ Evaluation:
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BAX is a heavy airfreight, time definite provider who continues to place more of its emphasis on logistics. Customers indicate a preference for the time-definite approach and are little concerned about what kind of vehicle their shipments move on. BAX has reduced the number of its aircraft to 20. BAX Logistics operates crossdock and other transportation value-added warehousing to buttress transportation management. BAX’s change of direction has returned the company to profitability while increasing revenues. | |
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| FedEx Supply Chain Services – Hudson, Oh NYSE: FDX (FedEx Corporation) 800-222-7657 Douglas Witt, President & CEO www.fedex.com |
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3PL Turnover:
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North America: $603m Parent: $22.5b | |
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Service Area:
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Service to 99% of world GDP; NA locations: 70 U.S., 18 Canada, 24 Mexico | |
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3PL Assets:
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2,000 employees 35 warehouses 298 tractors, 1,094 trailers |
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Information Systems:
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Excellent TMS – Optum: SCE Transportation i2 WMS – EXCEED 4000 |
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Services:
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Domestic and international transportation management, customs brokerage and freight forwarding, supply chain consulting, warehousing and distribution services | |
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Industry Focus/Key Customers:
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Apparel, automotive, computer and electronics, healthcare, industrial, retail Key Customers: DaimlerChrysler, DirecTV, Ford Motor Co., GM PowerTrain, Hewlett Packard, Mitsubishi, Philips Semiconductor |
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Armstrong & Associates’ Evaluation:
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FedEx Supply Chain Services follows its parent’s emphasis on transportation and supply chain solutions. Preference in transportation is given to other FedEx companies (FedEx Express, Ground, Custom Critical and LTL carriers). Sister company, FedEx Trade Networks, is a quality international transportation manager. The 3PL revenue shown above is for FedEx SCS and non-package businesses. | |
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| Werner Dedicated – Omaha, NE NASDAQ: WERN 402-895-6640 Marty Nordlund Sr., Vice President-Specialized Services www.werner.com |
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3PL Turnover:
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North America: $568m Parent: $1.5b | |
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Service Area:
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United States, Canada, Mexico; NA locations: 12 U.S., 2 Canada, 2 Mexico | |
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3PL Assets:
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12 terminals 3,000 tractors 6,400 trailers |
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Information Systems:
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Good TMS – SMART |
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Services:
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Dedicated contract carriage, IMC, brokerage, warehousing, crossdocks | |
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Industry Focus/Key Customers:
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Food and beverage, retail, building materials Key Customers: Coca-Cola, Dollar General, Family Dollar, Jimmy Dean Foods, Sears, Target, VT Industries, Wal-Mart |
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Armstrong & Associates’ Evaluation:
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Werner is a major dedicated contract carrier and U.S. trucking company. Its financial results are among the best in the business year after year. It has 110 dedicated contract carriage accounts. Werner’s arrangements with these accounts include primarily exclusive use of equipment deals with backhauls from regular company loads where possible. Werner is using electronic logging in all operations and is a step ahead of its competitors in this regard. Werner has extensive logistics service operations through its value-added services division (VAS). VAS has over $100 million per year in revenue. VAS operations include crossdocks, warehouses, intermodal and brokerage. Werner is a C-TPAT/PIP/FAST participant. | |
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| Landstar Logistics – Jacksonville, FL NASDAQ: LSTR 800-862-9256 Jim Handoush, President www.landstar.com |
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3PL Turnover:
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North America: $360m Parent: $1.6b | |
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Service Area:
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North America; NA locations: 60 U.S., 1 Canada | |
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3PL Assets:
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170 employees 6 warehouses |
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Information Systems:
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Good TMS – i2 WMS – Kewill |
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Services:
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Transportation management, brokerage, freight forwarding, warehousing | |
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Industry Focus/Key Customers:
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Automotive, LTL carriers, food and beverages, industrial, consumer goods, technology Key Customers: Celotex, Cost Plus, Glazers Wholesale, Hitachi, Honeywell, Kohler, National Liquor Dist., Philips Automotive, Unilever, Verizon |
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Armstrong & Associates’ Evaluation:
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Landstar is organized around a network of agents. The agents rely on Landstar for i2 and other software technologies plus cash flow coverage. As a result, Landstar is more entrepreneurial and decentralized than many of its competitors. Landstar agents are often willing to take on accounts with annual transportation costs as low as $2.5-3 million. In so doing, they provide high quality logistics options for smaller and mid-sized companies. Agents do not have assigned geographical areas and are free to pursue any account. One specializes in the wine trade - another in automotive and so on. A recent international freight forwarding agent addition with solid IT has been a plus. Landstar has also originated warehousing services in the southeastern U.S. | |
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| PBB Global Logistics – Fort Erie, ON 905-871-6500 Michael Scott, President www.ppp.com |
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3PL Turnover:
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$210m | |
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Service Area:
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North America, China, United Kingdom; NA locations: 43 U.S., 41 Canada 2 Mexico | |
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3PL Assets:
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925 employees 6 warehouses |
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Information Systems:
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Good TMS – proprietary WMS – proprietary |
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Services:
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Freight forwarding, NVOCC, IMC, customs brokerage, warehousing, trucking | |
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Industry Focus/Key Customers:
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Retail, chemicals, high-tech, industrial Key Customers: Certainteed, Dow Chemical, Eddie Bauer, Gillette, GTI Canada, Kraft, Molson, Sears, Starbucks |
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Armstrong & Associates’ Evaluation:
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For decades a solid trans-border import and export manager, PBB has expanded its North American intermodal and trucking operations through the acquisition of Clarke Logistics. Its China trade missions are well known. PBB has an office in China and can be expected to expand further under CEO Scott. PBB relies on 90 exclusive PBB agents for global coverage. PBB has a heavy emphasis on cross-border traffic between Mexico, the U.S. and Canada. This North/South emphasis is an advantage for PBB on a continent dominated by East/West traffic flows. | |
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| A.N. Deringer – St. Albans, VT 800-523-4357 Wayne Burl, President & CEO www.anderinger.com |
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3PL Turnover:
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$125m | |
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Service Area:
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North America; NA locations: 32 U.S. | |
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3PL Assets:
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550 employees 22 warehouses |
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Information Systems:
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Very good TMS – G-Log WMS – EXE |
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Services:
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Customs brokerage, duty drawback, freight forwarding, NVOCC, meat inspection, warehousing | |
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Industry Focus/Key Customers:
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Food, industrial, retail, paper and wood products Key Customers: Bombardier, J.D. Irving, Ltd., Rolf C. Hagen, Skis Dynastar/Lange |
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Armstrong & Associates’ Evaluation:
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Deringer is a very good Canada/U.S. cross-border 3PL. Customs operations are emphasized and Deringer excels at them. Deringer’s IT skills match those of larger companies. This organization is flat and cohesive. | |