Why Consolidation Has a Place in Our Industry
Jeff makes it clear that he is neither pro nor con consolidation . In fact , he believes it can be a positive for the last-mile . “ The aggregation of our space is cyclical . It comes and goes , and sometimes it ’ s a stronger trend than in others ,” he observes . “ I think it ’ s ultimately a good thing for the marketplace . If aggregation can provide synergy in reducing operating costs and increasing customer quality , I think it ’ s good in any space . Let alone our space . It ’ s been a real challenge because we are still in the cottage industry , trying to reach a national presence . And that ’ s a real struggle .”
The customization that characterizes our industry makes consolidation incredibly challenging , Jeff observes . “ I ’ m not saying it can ’ t be done . I am saying that the local knowledge required to handle the geo footprints CLDA members cover is essential . And I don ’ t think it can be homogenized .”
He believes the industry will find a way to deliver from coast to coast . “ I think ultimately , in this last-mile space , there will be a coast-to-coast strategy that will work ,” he observes . “ That may not be through mergers and acquisitions , however . There may be an alternative . A combination of relationships that allows companies to work off a single technology platform , whether a single owner or a platform seamlessly connecting to the customers . I think there will be great value to that .” He pointed to the recent merger of Lasership and OnTrac . “ That ’ s great progress ,” he says . “ I applaud these folks for doing this and think that ’ s what ’ s coming in some form .”
Is Consolidation Right for You ?
Jeff calls himself an agnostic on consolidation and urges leaders to consider whether it ’ s right for them . “ It ’ s all about the value proposition that results from the consolidation . Is it what works for you ? Consolidation is a means to an end . Ask yourself , ‘ What ’ s my endgame ? Can it be achieved through consolidation or selling ? Will there be synergy between the two organizations ? Can we partner as separate companies in a way that will take care of what I want for myself and my team ?”
Jeff advises those considering consolidation to reflect on their reasons for being in the business . “ I think people ultimately need conviction in why they ’ re in this business ,” he says . “ Then they need to ask themselves if selling will enhance that degree of conviction . There are just so many factors to consider , which can change daily . There ’ s no right or wrong . It just needs to be right for you .”
Still Bullish After All These Years
As someone who ’ s been in the space for over three decades , Jeff is always keen to hear what others in the last-mile are thinking about consolidation . “ I ’ ve been in this space a long time , and I know many people who have gone through a buy and or a sell ,” he says . “ There ’ s a lot of mixed rhetoric and emotion around those decisions . People will call me and say , ‘ Jeff , I know you ’ re being pursued , and many of these folks are after your Midwest footprint . Don ’ t do it . You run a good business . You ’ re in charge . You have good people . Keep doing what you ’ re doing .’ Then I ’ ll hear from others who tell me I should be selling . They ’ ll say , ‘ This is your time to monetize what you ’ ve done over the past 30 years .’ That tells me there ’ s a lot of conflict about what should and shouldn ’ t be done . But at the end of the day , I ’ m still really optimistic about what ’ s coming in this space . There are so many opportunities that I think Priority Dispatch can capitalize on . I ’ m positive about the team we ’ ve built and our company ’ s capabilities . More isn ’ t always better for me . Better is better for me . And right now , better is doing what I ’ m doing , with the people I ’ m doing it with , serving the spaces I ’ m serving . That ’ s what is better for me right now .” CLDA
summer 2023 I customized logistics & delivery Magazine 49