Earlier today, Greenville, Tenn.-based asset-light freight and logistics services provider Forward Air issued a mid-quarter update for the fourth quarter.
On a quarter-to-date period through November, for its Expedited Freight operating statistics, the company said that shipments per day were up 2.4% annually, with revenue per hundredweight up 14.7%, pounds per day down 11.9%, and weight per shipment down 14.0%, for the same period.
“Our focus on high-value freight, operated in an efficient operating environment, priced accordingly and offered to an increasing customer set is getting traction,” said Tom Schmitt, Chairman, President and Chief Executive Officer of Forward Air, in a statement. “The effectiveness of initiatives to bring our live events business back, sell to customers who do not use value-added intermediaries and, most of all, enable our core customers who know us best to win more high-value freight, stand out as evidenced by the increase in the number of shipments we handled during the period. At the same time, our customers and we are experiencing what we believe is a temporary but significant softening in the freight environment, with shipments significantly lighter due to 20% fewer pieces per shipment.”
The top Forward Air executive added that the company continues to invest in its service, which he said is leading the industry with best on-time performance and lowest damages crucial for time-sensitive, high-value freight.
Rate increase: And in order to continue funding its investments to support customers, he said Forward is rolling out a General Rate Increase of 5.9%, set to take effect on February 6, 2023.
“[W]e continue to be laser-focused on our Grow Forward initiatives that include building out our terminal footprint organically and in-organically, and as a result, we expect that these initiatives will outweigh the tremendous short-term headwinds, and we reiterate our expectation in a record 2022 and our target to top it in 2023,” said Schmitt.
In a recent interview with LM, Schmitt said that the company’s Grow Forward initiatives were rolled out in 2019.
“It may not be the most original title, but it actually fits quite well,” he explained. “Go Forward, in essence, it was us saying, we’re going to go for more high value freight that we learned half a year later we all called ‘essential,’ like medical equipment, high-tech goods that actually keep the industries going, and automotive parts versus wicker furniture, patio, furniture, kayaks, and rugs. So, even for more high value freight, we priced accordingly, and we also cleaned up our network to make sure we have smooth flows that we can actually deliver the value of no damages, on-time performance, and hitting time windows. So, for us, whether it is more consumer goods or more business goods, we basically, said ‘let’s be in charge of our own destiny.’ We believe that we should be the most compelling partner for high value freight. I think every company needs to figure out what game they should be in, and which game they should be playing and winning. In our case, we believe we can win the game for high value freight that is much more essential, [and] less discretionary.”
About the Author
Jeff Berman, Group News Editor
Jeff Berman is Group News Editor for Logistics Management, Modern Materials Handling, and Supply Chain Management Review. Jeff works and lives in Cape Elizabeth, Maine, where he covers all aspects of the supply chain, logistics, freight transportation, and materials handling sectors on a daily basis. Contact Jeff Berman
Leave a Reply