XPO Logistics
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Author: Kalicia Bateman
XPO Logistics is a top ten global logistics provider of supply chain solutions and transportation logistics. It operates in two main areas: transportation and logistics. Transportation makes up 64 percent of its revenue and logistics makes up 36 percent. Founded in 2011, its highly integrated network provides customized supply chain solutions for some of the most successful companies in the world.
The company’s corporate headquarters are in Greenwich, Connecticut and its European headquarters are in Lyon, France. XPO Logistics operates an integrated network of people, technology and physical assets in 30 countries, with 1,506 locations and 96,000 employees. It handles an impressive 7 billion inventory units daily.
The transportation area of XPO Logistics provides freight brokerage, last mile, less-than-truckload (LTL), full truckload, and global forwarding services. In North America, it is the largest provider of last-mile logistics for heavy goods which means it is efficient at ensuring large shipments arrive at their final destination from a transportation hub.
Its logistics area provides a long list of contract logistics services such as customized solutions, value-added warehousing and distribution, cold chain solutions, and various other inventory solutions.
There are three main service areas within its business model: supply chain logistics, transportation, and less-than-truckload.
Supply Chain Logistics
XPO logistics has extensive experience providing safe and efficient contract logistics for B2B and B2C goods such as cosmetics, consumer electronics, food and beverage, appliances, furniture, chemicals, medical equipment, apparel and more. For companies worried about seasonal surges or other special fulfillment processes (order personalization), XPO offers e-commerce solutions using its advanced tech resources.
It is highly focused on next-gen technology to provide solutions for its customers. Customers can expect an emphasis on robotics, autonomous vehicles, automated sorting systems, dones, and other tech that expedite goods through the supply chain. XPO Logistics has also developed XPO Direct™ which can position and reposition inventories within two-day ground transportation to the vast majority of the United States. It is a network of strategically placed XPO holding sites, docks, and last mile hubs used by multiple shippers simultaneously.
Transportation
XPO Logistics allows its customers to move its goods efficiently by rail, road, air, and ocean. It provides the following transportation options:
- Full truckload
- Intermodal and drayage
- Global forwarding
- Last mile
- Managed transportation
- Expedite
Less-Than-Truckload
Less-than-truckload (LTL) transportation is critical for customers looking to move relatively small freight. XPO has over 30 years experience as an LTL carrier and is one of the largest LTL providers in North America. It is committed to damage-free, on-time service for its customers. LTL service is provided by a network of approximately 7,500 tractors, 24,000 trailers, more than 12,000 professional drivers that operate out of 290 service centers.
Its LTL service in North America covers every state and about 99 percent of all U.S. postal codes. For customers looking for cross-border transportation, it has capability for movements to and from Canada, Mexico, and Puerto Rico. It's also a leader in LTL transportation in Western Europe.
Top Ranked Companies
The Good
- Safety Culture and Certifications
- Proprietary Solutions for Customers
- Tech-Forward
- Award-Winning
Safety Culture and Certifications
XPO is committed to safe practices throughout its global operations. It employs automated monitoring of carrier safety ratings, insurance qualifications, and operating authorities. To ensure employee safety, it has developed proprietary management software and strict guidelines for health and safety functions and regulatory compliance.
Proprietary Solutions for Customers
Something that sets XPO Logistics apart is its proprietary solutions for its customers such as XPO Connect. XPO Connect is a transportation technology platform that helps shippers and carriers make informed decisions leveraging an integrated platform. It offers real-time freight status visibility and up-to-the-minute delivery tracking.
It also offers customers its XPO Direct shared network of strategically placed stockholding sites, docks and last mile hubs. This proprietary network enables customers to be positioned within one- to two-day shipping of 90 percent of the United States population. Its predictive algorithms forecast optimal stock position for its clients.
Tech-Forward
XPO Logistics invests approximately $550 million a year in technology. This focus on automation and customization fuels its network by creating efficiency and visibility to help customers continue to grow. It is invested in data science and machine learning. One example of its tech investment is the predictive analytics it has developed to assist with customer demand forecasting and other sophisticated BI analytics and customized KPIs.
Award-Winning
It has won many awards recognizing its excellence in the industry. XPO Logistics has been recognized as Fortune’s Most Admired Company for two straight years. Fortune 500 also awarded it #1 in transportation and logistics for four consecutive years. These are just two among a long list of awards it has won recently.
The Bad
- Competitors Service a Larger International Network
- Potential Breakup
Competitors Service a Larger International Network
While it is a leader in transportation and logistics within North America and Western Europe, two of the largest markets, XPO Logistics does not provide service to as many countries as some of its larger competitors. It provides service in 30 countries. In contrast, one of its biggest competitors services 220 countries. While this may not be an issue for many potential clients who mainly have customers in XPO Logistics’ markets, it could be a deterrent for those looking to expand further worldwide.
Potential Breakup
In January 2020, XPO Logistics announced it was seeking to sell all but its LTL division in a bid to break up the company. After the large stock sell offs and market disruption began due to the coronavirus pandemic, it announced that it would cease the strategic review process. Its CEO had hoped that spinning off units such as its European supply chain, European transportation, North American transportation, and supply chain operations in North America and the Asia-Pacific regions would eliminate debt and raise the company’s profile and value as a purely LTL operator.
While this deal is off the table for now, customers should be aware that the company may pursue these changes at a future time.
The Bottom Line
XPO Logistics is a logistics and transportation company with decades of experience in providing safe, efficient contract logistics for B2B and B2C goods. It services a long list of industries such as apparel, consumer electronics, food and beverages, appliances, consumer packaged goods, and more. The company challenges you to tell its employees your challenging logistics requirement, and it will engineer sophisticated solutions using its impressive technology.
We believe that the expertise, impressive tech solutions, and extensive network such as its XPO Direct network would make it an excellent strategic partner for you and your business. Before you contract with it you will need to check that XPO Logistics can service your current and future needs within the 30 countries it services. If you are looking to ship goods to a larger and wider number of countries outside of XPO Logistics’ network, then you will likely want to consider other trucking companies.
