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3PL Brand Recognition, RFP Activity and Expected Profit Margins for 3Pls ‐ 2013

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3PL Brand Recognition, RFP Activity and Expected Profit Margins for 3Pls ‐ 2013 3PL Brand Recognition, RFP Activity and Expected Profit Margins for 3PLs ‐ 2013 April, 2013 Phone: +1‐800‐525‐3915 Website: www.3PLogistics.com Email: [email protected] Revised 4/12/13 ABOUT ARMSTRONG & ASSOCIATES, INC. Armstrong & Associates, Inc. is a supply chain management market research and consulting firm specializing in competitive benchmarking, mergers and acquisitions, strategic planning, logistics outsourcing, centralized transportation management programs, and supply chain systems evaluation and selection. Armstrong & Associates publishes Who’s Who in Logistics and Supply Chain Management – The Americas and Who’s Who in Logistics and Supply Chain Management – International. Recent research papers include "Mexico: Trucking, Railroads and Third‐Party Logistics Market Report," "U.S. Gains Carry 3PLs ‐ 2011 3PL Market Analysis and 2012 Predictions," "The Business of Warehousing in North America ‐ 2012 Market Size, Major 3PLs, Benchmarking Costs, Prices and Practices" and "Dedicated Contract Carriage ‐ New Life in a Mature Market." All Rights Reserved. No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopied, recorded or otherwise, without the prior permission of the publisher, Armstrong & Associates, Inc. The facts of this report are believed to be correct at the time of publication but cannot be guaranteed. Please note that the findings, conclusions and recommendations that Armstrong & Associates delivers will be based on information gathered in good faith from both primary and secondary sources, whose accuracy we are not always in a position to guarantee. As such, Armstrong & Associates can accept no liability whatsoever for actions taken based on any information that may subsequently prove to be incorrect. © Copyright 2013 Armstrong & Associates, Inc. 2 | Page Introduction In the first quarter of 2007, Armstrong & Associates surveyed third‐party logistics (3PL) managers to identify the most recognizable brands in third‐party logistics. The surveys also included sections on request for information (RFI), request for proposal (RFP) and direct sales activity profit margin expectations. In 2007, for the question, "When you think about 3PLs, what five companies are the first to come to mind?" DHL/Exel and UPS Supply Chain Solutions were mentioned on 22 surveys (65%). C.H. Robinson Worldwide, Ryder Supply Chain Solutions, Schneider Logistics, OHL and Menlo Worldwide Logistics formed a second group with 10‐11 mentions. A third group with 6‐7 mentions included UTi Worldwide, Kuehne + Nagel, GENCO and NFI. Twenty other companies were mentioned. In the first quarter this year (2013), we repeated and expanded the previous study. From 3PL managers, we received 30 surveys which encompassed and expanded our previous study. These surveys cover brand recognition, RFI/RFP/direct sales and margin expectations. In addition, we provided a shorter questionnaire on brand recognition at our website. That questionnaire received 110 responses from 3PLs, customers of 3PLs and others associated with the industry. The surveys used are in Appendices A and B. Brand Recognition Results ‐ Part 1 The list of recognized brand names has changed significantly over the last six years. Since our last study, the most surprising change is the lack of mention of Schneider Logistics in the core surveys of 30 3PL managers (30‐3PL). Schneider Logistics is mentioned eight times in the 110 responses (7%) to our website survey (Web‐110). Seven responses averaged to "B" scores for Schneider's dedicated contract carriage (DCC) and domestic transportation management (DTM) scores. The lack of mention of Schneider Logistics by our sample of 30 3PL managers indicates that Schneider Logistics is no longer viewed as a significant competitive 3PL threat. Ten companies (32%) that received single mentions in 2007 were not mentioned in our current study. New companies in DTM dominate additions to this year's study. Unyson Logistics, Mode Transportation and Comtrak Logistics, all subsidiaries of Hub Group, received notice. DTM 3PLs Coyote Logistics, Landstar, Total Quality Logistics and Echo Global Logistics joined the 50 companies mentioned by 3PL managers. DB Schenker Logistics received 15 mentions (11%) overall in both current studies. MIQ Logistics and Neovia Logistics Services, both new names, received multiple votes from our website study. The table below lists the new companies reported in the 2013 study. Thirty‐one new companies were included in the 30‐3PL sample. Eighty were added through the Web‐ 110 sample. © Copyright 2013 Armstrong & Associates, Inc. 3 | Page Table 1. Brand Name Additions ‐ 2013 30‐3PL Managers Survey Web‐110 Survey Access America Transport Access America Transport Meritor Logistics Averitt Express Supply Chain Solutions Agility Milaha Barrett Distribution Centers AIT Worldwide Logistics Millard Refrigerated Services Choice Logistics Allen Distribution MIQ Logistics Comtrak Logistics Barrett Distribution Centers Mode Transportation Coyote Logistics BDP International ModusLink Global Solutions Damco C2 Logistics Neovia Logistics Services DB Schenker Logistics Cain Logistics New Breed DSC Logistics CaseStack Nippon Express Echo Global Logistics Command Transportation Norbert Dentressangle Evans Distribution Systems Commercial Warehousing ODW Logistics Expeditors International Coyote Logistics Pacer International Flash Global Logistics Damco Panalpina GSI Commerce/eBay Daryl Flood Logistics PLS Logistics Services Jacobson Companies DB Schenker Logistics Qatar Logistics Landstar DDN RE Transportation MIQ Logistics Distribution Technology Robinson Industries (Wright Distribution) Mode Transportation DSC Logistics SCI Group Network Global Logistics DSV Sinotrans Old Dominion Echo Global Logistics SLI Pacer International Erb Transport Snyder RGL (Leicht) Expeditors International States Logistics Services Total Quality Logistics FLS Logistics Syfan Logistics Transplace FMN Logistics Think Logistics Transportation Insight GAC Toll Transportation Solutions Group Geodis Total Quality Logistics United Warehouses Globe Express Services Transplace Unyson Logistics GWC TTS Weber Logistics Hankyu UniGroup XPO Logistics Hitachi Logistics United Facilities Yellow Holman Unyson Logistics Total 31 Integra Logistics VASCOR Interstate Weber Logistics Jacobson Companies Wheels Group Kane Is Able Wincanton Kintetsu World Express WOW Logistics Landstar WSI LEGACY SCS XPO Logistics LINC Logistics Yellow Logistics Management Solutions Yusen Logistics Total 80 In 2013, the most recognizable 3PL brand is DHL/Exel. DHL/Exel received 16 mentions (53%) from 3PL managers. DHL/Exel also led among website responses being mentioned 57 times (52%). From the website responses, we isolated 25 that were from 3PL customers and others who are not 3PLs (Non‐3PL). DHL/Exel was mentioned by 21 Non‐3PL respondents (84%). DHL/Exel's brand continues to be very strong in general. © Copyright 2013 Armstrong & Associates, Inc. 4 | Page However, DHL/Exel was mentioned on 65% of the 3PL manager responses in 2007. Among its 3PL competitors, its recognition has slipped 12%. In the 30‐3PL sample, 50 total companies were named. In the Web‐110 sample, 103 companies were named. In the Non‐3PL sample, there were 48 named companies. While expansion of the total number of responses is a contributing factor to the naming of more brands, growing public awareness of 3PLs appears to be the main factor in total brands recognized. Table 2 below provides a list of the Top 20 brands identified by 3PL managers/competitors. DHL/Exel received 16 votes (53%) from the sample of 30 managers. Five votes were first place, and five were second place. In general, 3PL managers/competitors from strong value‐added warehousing backgrounds voted for Exel. Transportation managers/competitors, in general, voted for DHL and DHL Supply Chain. C.H. Robinson came in second. UPS SCS dropped to third. Table 2. Top 3PL Brands of 30‐3PL Sample Total 1st 2nd 3rd 4th 5th Total Brand 3PL Votes Place Place Place Place Place Points* Strength DHL/Exel 16 5 5 1 3 2 56 100% C.H. Robinson 13 2 5 2 3 1 43 77% UPS 11 2 4 4 0 1 39 70% Ryder 12 0 3 6 0 3 33 59% OHL 8 1 3 2 1 1 26 46% GENCO 6 2 1 2 0 1 21 38% Menlo 5 1 1 1 2 0 16 29% Jacobson 6 0 0 2 2 2 12 21% J.B. Hunt 5 0 1 1 2 1 12 21% Transplace 4 1 1 0 1 1 12 21% Kuehne + Nagel 5 0 0 1 3 1 10 18% CEVA 4 0 1 1 1 1 10 18% FedEx 4 0 1 1 1 1 10 18% Unyson 2 2 0 0 0 0 10 18% NFI 2 1 1 0 0 0 9 16% Saddle Creek 4 0 0 1 2 1 8 14% Coyote 2 1 0 1 0 0 8 14% APL 2 1 0 0 0 1 6 11% DB Schenker 2 1 0 0 0 1 6 11% Echo 3 0 0 0 2 1 5 9% Hub 2 0 1 0 0 1 5 9% Penske 2 0 1 0 0 1 5 9% Mode 2 0 0 1 0 1 4 7% Others Mentioned: Access America Transport, Averitt Express SCS, BNSF Logistics, Choice Logistics, Comtrak Logistics, Damco, DSC Logistics, Expeditors International, Flash Global Logistics, Kenco Logistic Services, Landstar, LynnCo Supply Chain Solutions, MIQ Logistics, Network Global Logistics, Pacer International, Regal Logistics, RGL (Leicht), Swift Transportation, Total Quality Logistics, Transportation Insight, Transportation Solutions Group, UTi, Verst Group, Wagner Logistics, Weber Logistics, Werner Enterprises, and XPO Logistics. *Total points were computed as follows: 1st Place = 5 Points, 2nd Place = 4 Points, 3rd Place = 3 Points, 4th Place = 2 Points, 5th Place = 1 Point © Copyright 2013 Armstrong & Associates, Inc. 5 | Page In addition to the disappearance of Schneider Logistics from the 30‐3PL sample mentioned above, a striking change is that UPS SCS has dropped by 30% in brand strength in comparison to DHL/Exel. In 2007, the companies had equal recognition among 3PL managers/competitors. On the positive side, C.H. Robinson's brand recognition has increased more than any other 3PL since 2007. C.H. Robinson is now second on the 3PL manager/competitor list with an aggregate score of 43, 77% of DHL/Exel's brand strength.
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