20 DC VELOCITY JANUARY 2014 www.dcvelocity.com
newsworthy
XPO Logistics Inc. has reached a deal to buy the supply
chain operations of Landstar System Inc. for $87 million in
cash. The move comes after Landstar determined its supply
chain business was no longer suited for its decentralized
model built around a network of agents that function more
like entrepreneurs than employees.
The transaction, which had not closed as DC VELOCITY
went to press, would give Greenwich, Conn.-based XPO
ownership of NLM, a provider of Web-based expedited
transportation management services. NLM, based in the
Detroit suburb of Southfield, Mich., is the main component
of Landstar’s supply chain business. Its transportation
management system automates the carrier selection process
for expedited transportation, defined as time-sensitive
movements with specified delivery windows and no tolerance for unreliability. Once a shipper’s load is posted on
NLM’s site, its software selects a carrier from among multiple bidders using multiple selection metrics. A decision is
usually made within minutes. The software then tracks the
transaction all the way to completion. NLM’s revenue
comes from transaction fees paid by shippers.
For XPO, the transaction increases its exposure to the
expedited transport category, which is one of three report-
ing divisions at the company. Expedited services account
for about 15 percent of XPO’s annual revenue. The bulk of
the company’s revenue comes from freight brokerage, with
the remainder from freight forwarding.
Bradley S. Jacobs, XPO’s founder and CEO, said expedited
services are poised for growth as just-in-time production
processes remain relevant and companies rely on fast-cycle
shipping services to mitigate the costs of carrying buffer
inventory. “We are committed to being a leader in this
space,” he told DC VELOCITY the day the deal was announced.
The deal also marks XPO’s first big foray into transportation management, a segment Jacobs said a couple of
months ago would be a focus of the company’s attention in
2014. Jacobs noted the success that rival C.H. Robinson
Worldwide Inc., the nation’s largest freight broker and a
major logistics service provider, has enjoyed with its own
transportation management business, known as TMC. The
unit is growing by about 20 percent a year, Jacobs said.
By the end of 2014, XPO expects to be second only to
Robinson in annual brokerage revenue. The company projects that it will achieve $5 billion in total annual revenue by
2017 through a combination of acquisitions and organic
expansion. ;
Landstar sells supply chain business to XPO Logistics
Intelligrated, a North America-based
automated material handling solutions
provider, has hired David Erickson as vice
president, software development, for its
N.Y.-based software subsidiary, Knighted.
… Saddle Creek Logistics Services has
named current president Cliff Otto as its
CEO. … Scott Larsen, president of R.H. Brown Co., and
Mike Wall, president of Container Systems Inc., have
been elected to serve on the board of directors of the
Material Handling Equipment Distributors Association
(MHEDA) for 2014. Additionally, Brett Wood, presi-
dent/CEO of Toyota Material Handling, USA, Inc., has
been elected to serve on MHEDA’s Manufacturers Board
of Advisors for 2014. … Amit Menipaz, general manager
of structured data at eBay, and John Inwright, president
and CEO of Quality Supply Chain Co-op Inc., have been
appointed to the GS1 US Board of Governors. … Menlo
Worldwide Logistics, the global logistics subsidiary of
Con-way Inc., has hired Michael Lim as business develop-
ment director for its operations in South Asia. The com-
pany also promoted Carl Fowler to vice president of
North America field sales and solutions. … J.B. Hunt
Transport Services Inc. has named Shelley Simpson to run
the company’s truck operation. Hunt also named Greg
Breeden senior vice president of marketing and network
development for the truck unit. Hunt has transferred
Steve Rogers from the company’s dedicated contract
services unit to become the truck unit’s vice president of
operations. … Tom Wolsos has been promoted to the
new position of channel director by Andersen Material
Handling and its wholly owned subsidiary, Integrated
Systems Design. … Laurie Barkman has been selected as
the new president and CEO of Genco Marketplace,
Genco’s wholly owned liquidation subsidiary. … Jim
Wolfe has joined American Baler Co. as manager of engi-
neering and customer service. … Jeff Metersky has
joined LLamasoft Inc., a developer of supply chain design
software solutions, as vice president of solutions strategy.
… Third-party logistics service provider Kane Is Able Inc.
has named Brian Glasgow director of campus operations
in Scranton, Pa. … Logistics service provider Kenco has
appointed Kevin S. Fletcher senior vice president of
transportation services. … Automated guided vehicle
manufacturer Seegrid has hired Dori Kozak to serve as
marketing manager in Europe and the Middle East.
newsmakers
ERICKSON
