The Freight Pod
The Freight Pod is a deep dive into the journeys of the transportation and logistics industry’s brightest minds and innovators. The show is hosted by Andrew Silver, former founder and CEO of MoLo Solutions, one of the fastest-growing freight brokerages in the industry. His guests will be CEOs, founders, executives, and leaders from some of the most successful freight brokerages, trucking companies, manufacturers, and technology companies that support this great industry. Andrew will interview his guests with a focus on their life and how they got to where they are today, unlocking the key ingredients that helped them develop into the leaders they are now. He will also bring to light the fascinating stories that helped mold and shape his experiences.
The Freight Pod
Ep. #74: Peter Coratola, President, CEO, & Founder, EASE Logistics
What does it take to build a $220 million logistics company from scratch? Peter Coratola, CEO and founder of EASE Logistics, reveals the hard-earned wisdom behind his remarkable journey from unemployed college graduate to logistics leader.
After being let go from his first industry job at 23, Peter launched his own brokerage with nothing but determination and a newborn son to support. His philosophy was simple yet powerful: "The more you do, the more you make." This approach became the foundation for a company that now handles hundreds of millions in freight and employs teams across brokerage, asset-based transportation, and warehousing operations.
The turning point in EASE Logistics' growth came from an unexpected direction – taking on high-stakes automotive line production freight. "That's like taking your driver's ed on the Indy 500," Peter explains, describing how the unforgiving standards of automotive logistics (where line shutdowns can cost manufacturers $5,000 per minute) forged operational excellence that transferred to other industries.
Peter's perspective on technology and AI reflects his commitment to customer service above all else. While embracing innovation internally to make his team more effective, he remains cautious about technology replacing the human connections that differentiate his business. "It's easier for logistics companies to be good today, but harder to be great," he observes, pointing to EASE's true 24/7 operations with 25% of staff working night shifts to ensure problems get solved, not just acknowledged.
As market conditions continue to challenge freight brokers, Peter's leadership lessons offer valuable insights for anyone building a business. The hardest moments weren't market crashes but people decisions – learning to balance emotional investment with necessary business choices. His advice for navigating tough times? "Stick to the plan, not your mood," and focus on putting points on the board every day through small wins.
What will the freight market do next? Peter sees challenges continuing through 2025 but anticipates improvement by mid-Q1 2026, particularly with automotive manufacturers launching 27 new models. For those weathering the current market, his story demonstrates that preparation, adaptability, and maintaining team swagger through continued investment can position companies to thrive when conditions improve.
Follow The Freight Pod and host Andrew Silver on LinkedIn.
*** This episode is brought to you by Rapido Solutions Group. I had the pleasure of working with Danny Frisco and Roberto Icaza at Coyote, as well as being a client of theirs more recently at MoLo. Their team does a great job supplying nearshore talent to brokers, carriers, and technology providers to handle any role necessary, be it customer or carrier support, back office, or tech services. Visit gorapido.com to learn more.
A special thanks to our additional sponsors:
- Cargado – Cargado is the first platform that connects logistics companies and trucking companies that move freight into and out of Mexico. Visit cargado.com to learn more.
- Greenscreens.ai – Greenscreens.ai is the AI-powered pricing and market intelligence tool transforming how freight brokers price freight. Visit greenscreens.ai/freightpod today!
- Metafora – Metafora is a technology consulting firm that has delivered value for over a decade to brokers, shippers, carriers, private equity firms, and freight tech companies. Check them out at metafora.net. ***
and we're off. Welcome back to another episode of the free pod. That's the first time I've opened the show like that without just a welcome back. And, uh, I'm joined today by a special guest, per usual, ceo, founder of Ease Logistics, mr Peter Corotola. Do you go by, peter, peter?
Speaker 1:Depends if you're mad at me or not. Let's go with Peter.
Speaker 2:Not there yet, we're 40 seconds in, so I don't have anything to be mad at you about yet. So it's good to have you, man.
Speaker 1:Welcome to likewise I appreciate you having me on, so I'm excited.
Speaker 2:I you know I was just telling you before we started recording I've I've come to learn that, um, when I get to sit down with brokerage guys like yourself, it's such a natural conversation and I just love it. So I'm excited for this. Not that it's not exciting to talk to all the AI guys and all these other things, the businesses that I haven't done. It's just a different thing where I have to, you know, really put in more energy and effort versus sitting and talking to a guy like yourself who has been through similar things that I have and I know your world, and so I'm excited to get into it today, as am I.
Speaker 1:Yeah, there's a common ground of brotherhood or sisterhood that's formed when you're in the office at two in the morning ripping every carer call off DAT trying to find somebody.
Speaker 2:Speaking of. You know that is the opposite of ease or easy, and you know any good broker knows that there's nothing easy about this job. So your company is called Ease Logistics. Let's talk about the name for a second. Where does that come from?
Speaker 1:Yeah, you know, I wish I could tell you it was some like really thought-out business plan. Actually, like moments before we were going to file I was filing for the LLC, it was actually a Midwest loyal with an L, you know. And right before we signed it, the lawyer I've been working with for like weeks was like why Midwest loyal? And this is the name we'd been talking about the whole time. It's like what if it gets bigger? I'm like, well, all right, danny, a little late in the game for opinions. But I appreciate, you know, appreciate the insight, and I remember at that point just kind of thinking through, like what am I trying to accomplish, right? And some of the things that drove me to wanting to do this kind of led me like simple, how you know, how easy can we make logistics? You know that. Then it kind of you can kind of see where I made that jump.
Speaker 1:And I started searching and I was actually shocked to find out there wasn't a ease logistics. You know there was an ease transport way back in the day out of California, which I will come to find later in starting the company. That that was quite the hurdle to get over, right. Not only a new MC number. But when you have a similar name coming that went out of business, right, yep, not only a new MC number, but when you have a similar name coming that went out of business, right, uh, yep. But you know it plays into what the focus is at ease and what kind of drove me there is. You know the ease of logistics, making it easy for X user inside the office, the customer, the carrier. You know how do we increase the experience, how do we make it a better experience? You know how do we increase the experience, how do we make it a better experience? Um, really like taking that model and just applying it through how we operate and you were pretty young when you started the company.
Speaker 1:How old uh, I was 24. I was 24 years old. Um, I'd worked at another logistic shop prior to that. You know, I graduated from Ohio State criminology degree, which again come to find out later. That actually is pretty applies pretty well to logistics as well. You know, my firstborn son came, peter Joseph, in 23 October and I was let go from my last you know that other was just his company shortly after.
Speaker 2:So wait, in 20, in 23,? In 13? Yeah, I'm sorry, sorry, okay, 2013. You were 23 or yeah?
Speaker 1:2013. Got it, I got let go started in 2014. So I was, you know, 24 years old. Why'd you get let go? Crappy employee, pretty much, you know. Intolerant smoking in the office no, it was, you know. Intolerant smoking in the off? Now, uh, it was, you know it was. You know, just didn't see eye to eye from the communication I got. Um, you know it was a. It was a peaceful separation and, you know, still in a lot of respect because it brought me into the industry and it made me see the opportunities and the potential, what could happen inside yeah, I was gonna make a comment that you clearly made some bad decisions early in your life, like going to Ohio State University.
Speaker 2:I just wanted to find a way to plug that as a Michigan man I was gonna say so how did you find freight like? How did you end up even at the, the first logistics company?
Speaker 1:and that was it. You know, when I graduated in what? 2012,? It wasn't the best market going on really out there with criminology and my dad's a retired police officer. Even with both those things, I still didn't make the cut to be a police officer.
Speaker 1:So I was going into the workforce world with a huge ego, right after being shot, you know, and really it was one of the job offers I got at the time. Just, you know, I didn't really know what brokers was. To be honest with you, you know, I walked into the office, interviewed and I, you know, got a crash course of how the industry works. Um, and, and real quick, you know, I started my, you know, my life's journey of different jobs I've had being a coach, working in construction, project management, kind of all coming together and being utilized well in this industry. Right, a little bit of grit, problem solving, have to be confident, have to pick up the phone, have to communicate you do all these things simultaneously really well, right, and you introduce a little bit of luck, it can be that flip, that switch flips and I start to get the itch type of deal, and that's really what drew me into the industry to a point where I was that young guy that probably is annoying to the seasoned brokers right, taking the phones at night saying I'll work the weekend shifts because I was.
Speaker 1:I was truly intrigued. You know I was addicted, but it was like you know and I still use the philosophy today the more you do, the more you make, right. So, like you know, the more customers you call, the more opportunities you get. The more quotes you send, the more loads do, the more you make. The more customers you call, the more opportunities you get. The more quotes you send, the more loads you have. The more time you call carriers, the better rates. The more time you check on your loads, the less service issues. It was like your whole life. You're taught put in hard work and you'll reap the benefits. I feel like the logistics industry was for the first time where you put in the hard work and it really does. You know you can't reap the benefits.
Speaker 2:I was going to add before you got there that that, as you said, that the more you do, the more you make. It's like the logistics industry is the perfect example of that. And and one of the reasons I was excited about having you on the show is because I think there are a lot of guys and gals out there today who are in a similar position to how you were 12, 11 years ago a young, 23, 24 years old coming out of college. Maybe they've had their first taste of freight in logistics as a kind of w-2 employee, but they have bigger ambitions and they wonder, like, could I start my own thing? And here you are, kind of 11 years later, being a guy that started by himself now has like a fully operational, scaled, successful freight brokerage. It's, it's cool. So that's that's one of the reasons I wanted to have you on the show and kind of uh used you as a source of inspiration for the uh, the youngins out there I appreciate that and it is.
Speaker 1:It's, you know, I always say especially at ease, and you know, I think, from the lineage companies you've worked out, I think this also aligns well. It's like if you, if you make it through the first 18 months and you're successful, you're going to be successful here or you're most likely going to go be successful and be the most successful person at the next company you go to. If you keep the same qualities and work ethic is a great career path, a great entrepreneurial path. But also it's a great first stepping stone for a lot of people that don't know what they want to do, because it forces you to be responsible, forces you to communicate, it forces you to do all these things at the same time Right. And then it constantly reminds you how you have to accept defeat, learn from it and just move on quickly. You got to compartmentalize and just go, so I think it kind of puts that rhino skin on you real quick.
Speaker 2:Yeah, you nailed it to accepting defeat and moving on quickly with a short kind of goldfish-like memory. To the value of having to do 14 things at once and learning how to prioritize. To communication skills, because the difference between an excellent communicator and a poor communicator they can have the same customers, the same opportunities, the same workload and for the excellent communicator they're going to make a lot more money and probably have to do a lot less physical work, versus the poor communicator who's going to make a lot less money and have to do a lot more work because you're constantly playing from behind, the worse you communicate. And it's really to me, like to take it a step further great communication it's not even just about how you personally engage or, you know, talk to a customer or to a carrier, but it's it's almost more so like a step further back is how you set, how you set expectations between any relationship you have, whether that's between you and an operations rep on your team, or you and a carrier rep on your team, or you and your carrier, or you and your customer. And the example I always try to use is from my own days as a carrier rep. I had a bunch of owner operators that I worked with and I worked my ass off for them, because I thought that I was competing with not only every other broker but even the other people on my team in that like if I didn't offer a better level of service to these guys, they would give their trucks to someone else. And that's still true today.
Speaker 2:And so my thought was I'm going to tell these guys from the jump here's the thing I expect, xyz out of you. I expect you to be as guys from the jump. Here's the thing I expect X, y, z out of you. I expect you to be as on time as you can be legally. When you're not on time, I just expect you to let me know as soon as possible. And then, maybe most or as important, when shit hits the fan, I just expect you to work with me like a partner who wants to do what's best for both of us.
Speaker 2:Expect you to work with me like a partner who wants to do what's best for both of us, understanding that sometimes what's best for both of us is not best for either of us. It's kind of meeting in the middle type deal, but in exchange for them doing those things, I'd be willing to answer the phone whenever they needed me and if I wasn't available I'd call them back right away. I'd always kind of go to bat for them and do whatever I could to take care of them financially and, you know, help them out of detention situations, whatever it may be. But setting that stage on the front end saves me so much time over the long run of not if a carrier couldn't accommodate that I wasn't the right fit for them, but that's like to me, like a step further on communication that can make a broker's life so much easier.
Speaker 1:It's huge especially on the carrier side, right, and I feel like we handle it, or I handle very similar setting expectations. It was like either we're going to be on time or there's a no surprise execution, right. So like we both don't want to be late. But if you tell me you're going to be late, I can, I can work with it. You know, and you find real quick in this industry. You know we jumped into automotive line production as one of our first customers, right, that's like. That's like taking your driver's ed on the indy 500. You know, that's a great, that's a great comparison. You try to fabricate it. I've seen grown adults crumble trying to fabricate a story to a plant manager that has line production costs of 15. You know what I mean. You just can't do it. You know he doesn't care about the story anyways.
Speaker 1:Yeah, he doesn't you know, and when you possess that internally, you know you take the same level of respect to your customers as to your carriers and you set those expectations. It just has that constant flow of respectful communication. A lot of times people don't know where to start. How do you communicate better? How do you? And I always tell people, it's as simple as respecting people's time and responding to them and addressing by name. You know, I mean, we have some of our customers that we've worked with for 10 years and we've deployed truck fleets, we've have autonomous trucks, we have all this, you know, warehouse, and they still say, hey, your response time is why we love it. I'm like well, austin, you know, probably could have saved some money on the other big assets, but it's, you know, I love that. The the first, you know, the first kind of sales pitch is still working, but it's. It's so important and that's what I, you know, continues to scare me about the evolution of technology in the industry and where it's being placed Right.
Speaker 2:Like because you think it risks losing some of that.
Speaker 1:I think it challenges it every day. I mean, I think we're. How? How many months away are we from carriers being inundated every day by ai calls asking where their trucks are? You know we're not far from that. You know, and it terrifies me because then it's, you know, the masses that we're fighting with just to actually get them on the phone to talk.
Speaker 1:And you know ease takes a stance from a standpoint of, you know, humanity executed, but tech enabled, right. So we want to always manage the communication between humans and put all the tech behind us to make us quicker, faster, stronger. Yeah, there's time and a place for certain customers and carriers that like portals and like that. You know I'm not discounting it, Um, but I think the emphasis on communicate, respectful communication, timely communication, Um, I mean it's, it's an incredible business tool where you know you don't need to invest in massive tech stacks to be able to to execute that right. That's a mindset and that's a cultural inside those walls, that if everybody gets on board, it's a, you know, it's a universal perk for the, for everybody that works with you and it attracts customers, carriers and business.
Speaker 2:Yeah, I think for me.
Speaker 2:I think about it through the lens of, like, meeting the customer where they want to be met, and by customer I mean the carrier, I mean the shipper, I mean in some cases, even your employees, and you bring up an interesting point around, kind of the AI bots calling and it's definitely going to we're going to get to a.
Speaker 2:There's going to be a problem, like you know. There's so many of them coming out and I'm sure the tech will be good and I've heard the voice on some of them and it's good but there's gonna be a point of like a tipping point where the carriers are just getting too many calls and they'll have their own ai technology that probably is doing the same thing. It feels like it's going to be a chaotic mess of data. But I think, as I would think about it, there are going to be some carriers that maybe even prefer it for certain things, where it's like hey, I want, like a dispatcher might want to have his own AI that just pays attention to if the trucks are on time and handles all the updates, because a dispatcher doesn't want to have to take that call from one of your ops guys being like hey, is that truck going to be on time? Like he doesn't want to deal with that, just like your rep doesn't necessarily want to deal with making the call asking if he's going to be on time.
Speaker 1:Right, and that that's actually where we've put it and that's kind of our. You know, when I sat out and I drank the juice of AI, you know actually this past Monday how to taste uh, well, let's start at first, but now it's very addictive. Uh, you know, it was terrifying. It's like a Diet Coke. Yeah, it challenged everything for the philosophy that got us here. I mean, for the size that we've gotten. We're sending handwritten email updates 24 hours a day to customers, big and small, right, so I'm that terrified of losing that experience. Call me crazy, I get it, but where our focus was is using it for the outbound compliance calls and when we're building it, I was very direct. It was let it sound like a human, but it should be the experience of like TSA nobody goes through TSA and be like man. That was a great pat down. I really enjoyed that customer experience.
Speaker 1:You know it's like, are you the driver that's supposed to be on the load? Are you meeting the qualifications to go through? Right, so it's intentional, but it's required, you know, yeah, so, like, I feel like that's a good use case because the calls have to happen right and ai is not emotional. So there's no, you know there's no, all right, waiting on paperwork, I'll mark you empty and said you're going there. Type of deal it's yes or no. Type of. You know there's no, all right, waiting on paperwork, I'll mark you empty and said you're going there. Type of deal it's yes or no. Type of deal. You know that is an area where we're finding success, right, I'm terrified to put it anywhere else right now because, right, like you said, we both grew up on the ops floor. We know how much is learned on an inbound call for someone calling in on a load, or you know, just from the first couple of seconds of the tone or whatever.
Speaker 1:You know, and those are all things that I'm still striving to get back. You know, like four years ago we converted to soft phones. It killed my soul, right? You don't hear the ring? Oh my god. I still. You know, part of me wants to go hang an old phone up at the top of the ops floor just to have it. You know, like background noise, how could it be applied? You know, if carriers could have their own AI agent when they called, just to say, hey, we have someone call me, so they always get, you know the calls always answered. I think that's a good way to have a good meeting round, but it definitely terrifies me and, uh, I think we're approaching it in a way that aligns with our service and how we want to continue to handle our operations. But I think about all the time, about these carriers. Uh, any data, I mean how many calls. We all get spam calls. I can't imagine the shippers, how many they get.
Speaker 2:Mm-hmm, are you looking to grow your brokerage? Are you struggling to land new customers in these challenging market conditions? Look within so many companies that tender you freight throughout the domestic United States also have business coming out of Mexico. A year ago I understand why you might not have seen that freight as an opportunity, but today Cargado exists and that means any load coming into or out of Mexico is now an opportunity for you to support. In just over a year I've been able to see Cargado go from ideation to launch to rapid growth. I've been able to see Cargado go from ideation to launch to rapid growth. It's amazing to see how many logistics companies have been able to use Cargado to expand into Mexico to grow their business. Cargado is the first platform that connects logistics companies and trucking companies who are moving freight into and out of Mexico. If you move Mexico freight or are planning to reach out to Cargado today at Cargadocom, that's C-A-R-g-a-d-ocom. Yeah, it's, it's, it's um, it's great, it's changed we, I feel like we really are at a tipping point.
Speaker 2:You know, when we look at the last 11 years of your business and I do want you to kind of walk through some of the early days, but like there were little or it feels like there were impactful changes in the industry that happened like kind of in silos, like the eld mandate happened. I think you were like three years into your business at that point. That was a big change it was, but it was like siloed and we all kind of dealt with it as we did. There was like the carb out in california, that that whole thing um a change. You navigated whatever, but there weren't like groundbreaking changes in our industry. You know, the the big one was, I guess, the last couple years that I thought was really going to impact how guys like you and I had to think about our businesses was the API pricing for kind of real-time dynamic spot quoting. That was a meaningful change where it's like, okay, if I don't figure out how to bring this into my business, I'm going to lose some of my volume from customers. That was your hand was forced.
Speaker 2:What we're entering now with this kind of age of AI, feels like it's a very different change, because, one, it's not a required change, it's not something that your shippers aren't like calling you and say, hey, if you don't implement AI, you're out. And two, it's completely uncharted territory where no one knows what the scaled outcome of any one of these solutions might look like. No one knows what it's going to look like when you let the AI call every carrier in your network every day and how they're going to react to it any of that. So it's like you kind of have to, as an individual business owner, make these individual bets within your company on. I think this is going to react to it any of that. So it's like you kind of have to, as an individual business owner, make these individual bets within your company on.
Speaker 2:I think this is going to work. I think that's going to work. So I am curious from your perspective, how are you thinking about how to deploy what and when? It feels like you're kind of more on the not skeptical but apprehensive, or really I guess, if I had to guess and I'll risk that it won't change it for the better, necessarily and that there may be fall off in service and you just can't have that yeah, I mean, it's like you said, the industry, our industry, has kept some very age old things for a very long time and then we get some of these right.
Speaker 1:I mean shit I have. I I think we still have a my fax account. I might be the only person my fax, I might be the only customer left, right, uh, but I mean, I think we both remember faxing packets back. You know any more data facts. And now, now ai comes out and within two weeks of you know, comes out. Then there's all these different things. It's hard to keep up.
Speaker 1:Um, how we look at it is you know again, where can we apply it? That doesn't impact this, doesn't impact things. That has got us here. You know communication, respon, accountability, making sure that our compliance is high, all you know. So where do we focus? Right, have you know viciously attacks and redundant processes that are taking up time on a call? Sure, so when I looked at AI, how did we want to start with it?
Speaker 1:Our first benchmark was I wanted everybody in the ops floor. If I went out there and asked who's using AI today, everyone would raise their hand. You made a post the other day. I was going to ask you about it, about everyone's talking about AI. Who can show me something? And I appreciate that. Ask you about it, about everyone's talking about ai, who's actually who can show me something? You know, um, and I appreciate that. I'd be curious, you know on record, off record, to see kind of what the responses kind of got, because I feel the same way, you know.
Speaker 1:So our goal when we sat out was how do we get everybody using it in any capacity? You know, and that's been our goal, and you know, six weeks ago we launched our first AI account manager assistant in our ops on a Thursday and you know, at noon I walked the ops for how many people use the AI today before launch 20%. You know, before launch, not launch 20%. Maybe raise their hand. You know, next day walked out tire falling, raised their hand Right and it wasn't auto rating, it wasn't getting in the way of customers, it was that asking questions about data that we had and the communications inside our teams chats went from hey, what should I pay on this to look at the carrier rate versus market rate analysis when we book 72 hours versus 48 hours on these shipments? But you know it was like you know.
Speaker 1:So, like how I'm looking at it is, how do we improve just people's adoption? And like how they use AI inside these walls. And then let let us see the most type of questions that are being asked and let that be the next command prompts that we are writing. And since we've deployed, we're up to about a thousand interactions a day across the ops floor.
Speaker 2:So what you're saying is it's less customer facing and more, currently, a tool to give your people, who are individuals doing their individual job, a better way to digest data and information that's available to them that without AI they didn't necessarily know how to get to at least as quickly 100%.
Speaker 1:There's no AI between us and the customer. It's taking every customer data that we get from inbound email or data loads on the board and capacity or account managers can say you know, what quotes do I have or where should I focus? Do I have any issues? You know? You know, give me something to talk to this customer about. You know, and it's just now, there's, and we've limited it a little bit and I've told everyone with caution, like you know.
Speaker 1:Again, which is a crazy thing that we have to talk about is hallucination with technology. Right, crazy, but it's. It's. It's just, I think, getting everybody to adopt it and just get comfortable with this new form of technology, this inner, truly interactive form of technology right that expands your brain, that challenges the normal, right. It's not just like, but let me type in this word, or put in Excel and it's, it's.
Speaker 1:How do it's like making you think and use technology and data to actually, you know, instigate motion. You know it's, rather than just using data to say this is what I did, we were successful or not. It's, this is what we did and this is what we should do now, or this is what the trends are telling us. Right, and it's really powerful when you start getting a buy-in on just using it, and I've been, I've been happy with our, with our approach, and I think the use cases show that it's you know, with our approach and I think the use cases show that it's you know, at least it's working inside our walls of getting more buy-in and people using AI every day.
Speaker 2:Yeah, I mean, I love the way you're thinking about it, because you made it clear your intent, which is you want everybody to taste it and get a feel for it and try it, and in doing that, there's a couple of things that happen. It and try it. And in doing that there's a couple things that happen. One is like curiosity becomes like a catalyst for opportunity and development because you know you're not giving them like a hey when you schedule, you must use this tool to hit this button. That's like more remedial, like redundant task removal, as you were talking about, but this is more of like a how do you engage with the customer better using our data today? And we've now given you a tool so you can ask it kind of dumb questions and not feel dumb, right, but like you can play, and you know play is a great way to get people to.
Speaker 2:One be bought in um, but two, what I think it will do is it's going to give people a chance to stand out.
Speaker 2:Like if I'm an employee in your four walls right now I'm thinking how do I become the best at this? How do I show that I am able to take this new tool and make the most out of it for myself in terms of my own development, but also for my customers and my carriers and, ultimately, for the business, because, whether people like it or not, this is becoming a part of the future. I'm not going to say this is the future because I don't know, I'm not saying it's everything, but it will be in most of our workflows in five years, and the people who, in the early days, showed the most promise and kind of adaptability to navigate it and leverage it, those are the people who are going to be running the business. I mean, those are the people who are going to be leading the new teams and divisions that get started up using this stuff. So I just really like kind of how you're thinking about it, especially in the keeping in mind that it's low risk, right?
Speaker 1:That's it. It's creative and, like you said, we may be losing some ground on certain areas where we don't have AI fully deployed, but we have 100% adoption, maybe on an ops floor. So it's like you know we're grooming a team to at least understand how to use it. And when I told the ops for I told him kind of like when we started this talk, it's like you using AI every day will make you successful here and if it eases now your forever career, it's gonna make you successful somewhere else, because this is where the world's going right.
Speaker 1:So, challenging yourself just like I challenge myself to get on you know inbound logistics or something every day to just read something you know, it's the same thing.
Speaker 1:Ask it a question, you know, and it. And when you start to see the type of questions I mean, I look at what it can do and I think back, like what we said, the more you do, the more you make, like what it can do for a growing account manager for engagement, or how do I talk to this guy who should I call you know? What care should I call you know? Like one of our next kind of phases is how do we increase the chance of success on the first outbound carrier call for a load by X percent. You know, because you know as well as I know that we move that needle 5%. That extrapolated by what I mean. That's why it's like it's, it's hard to even trace back an ROI. But for people that's been on the floor of I can, of my successful book call is the third call rather than the seventh call. You know how much time we're getting back.
Speaker 2:So it's crazy to me how much time we're getting back, so it's crazy to me. That's such a perfect example of using this internally to become more efficient, and it can't help but go back to for me, what was 2000,. I don't know, maybe 2009, 2010,. I was 19 or 20, working as a carrier rep and coyote had as good a tools as anyone back then then. But but even then, you know, knowing who to call on a load for me was an. I was a sticky notes guy.
Speaker 2:I had I had a hundred sticky notes on my desk and rain and like I just really, yeah, I was like it was a little bit rain man where I was like trying to rely on my memory.
Speaker 2:I'm like, okay, I just saw this coke load from atlanta to tampa. Um, who is it? Who is the guy I talked to? Oh, impel logistics. Where's his number? Oh, it's over here. Right, like that's the first guy I should call because he's like to think of where. Where we were then, versus what you can do today with the technology is, um, it's fascinating and that's, and that's how you think about building that right.
Speaker 1:It's like, hey, remind me of this, you know, just like those type of reps. It's like let's just start getting those all in a box to make our account managers, our carrier reps, so powerful that the chance of success on their first engagement is so high. Right, or at least it yields something. It yields a yes or no, not, you know.
Speaker 2:What we're trying to do is at least not, you know, remove empty calls or carriers or customers we shouldn't have called, or something like that, you know yep, and I just want to hit one more thing on your point about like feeling like maybe there's an area where you're behind against competitors in this and and I want to say resoundingly, I don't think that's going to be the case, because I think I I think there's a very valuable lesson that people can learn from uber. Um, uber came into this industry with more resources than anyone ever has. No one has ever come into this space as a startup with the amount of financial and technical resources that Uber had, and it wasn't hard for them to get business. I mean, they called and people wanted to hear what Uber had to say. Yet, 10 years later, they have a reputation that is not necessarily one that certainly you or I would be proud of in terms of how you and I think about execution and service, because for us, the customer is always first, and making sure that we deliver on the commitments we made to them is like the. If we said we were going to do X Y Z, then we have to make sure we do X Y Z.
Speaker 2:And I think the fault in Uber's approach was their philosophy was innovate, innovate, innovate, even if it's at the expense of the customer in the short term, I think in their minds. In the long run, they were always going to do what's best for the customer, but there was a lot of pain created for the customer along the way. Why? Because technology was the priority. And when you make technology the priority above the simple execution, what ends up happening is you deploy a new technology or deploy a new AI tool or this or that, and 60% of it works, because it's never right the first time, and the 40% is fallout. And the people who feel the impact of the fallout are the customers. They're the ones that didn't get the right information, they're the ones that didn't get their loads picked up up or they're the ones that get a bid passed back to them. I mean, I will never forget an instance of hearing about an uber situation where they won like a 30 or 40 million dollar drop trailer award from I think it was procter and gamble and immediately called and gave the whole thing back and was just like, yeah, the tech didn't work, it wasn't right and that's terrifying.
Speaker 2:I think that's a perfect example of like I would. I would be in a very bad mental state if, if my team was calling our customers doing that. I would not be okay. I would. I would not have made it right, um, and I think that's why guys like you and I spend so much time kind of insulating our business with like this. We know the number one rule is execution. Everything has to fit within that rule and I'm not just going to deploy a new AI tool because I think in the long run, it's going to be great if the risk is a deterioration of execution, and I think that's where a lot of people miss. And so I don't think you fall behind by not like being the first mover on some of this stuff Right, and that's it.
Speaker 1:It's like it's terrifying to say yes, we want to. You know, I actually think I picked it up from an old coyote. Like, talk of, like viciously attack redundant processes, right, like we want to, we want to do that Right, but we can't be at the expense of our core values and our core, what we agreed to right. So like, let's go attack all the other ones, right, but I'm losing. I'm losing an edge on my competition because I'm X and that X entirely challenges, like you said, 100% execution, 100%, be able to stand behind our commitments, you know, be able to get a hold of all these things, and that's right now. That's the risk I'm willing to take.
Speaker 1:You know, technology is making it easier for companies logistics companies to be good, right, and I think it's making it harder for people to be great as well. You've got to really foster that communication as a business tool by empowering technology. I think in certain areas we share the same sentiment. It terrifies me. Again, I appreciate the confidence you have in my approach. If we do another one in two years we'll see if it was the right call or not. I appreciate the confidence you have in my, my approach. Let's you know we do another one in two years. We'll see if it was a right right call or not that's fair.
Speaker 2:I mean to me what I look at it as in terms of what we're, what you might be missing out on or what you're losing is you're you're giving up maybe some efficiency in the near term where it's like, okay, they say this tool can do X, y, z. If I were to do it, I can probably decrease my costs on that function by 10%. And so it's like, if I have to choose between short-term giving up 10% or X% of my potential margin improvement to ensure that my execution stays at the level it needs to, I'm picking that. I'm giving that up every time because I want to see it play out first, like I just if every decision I were making as a business leader was just focused on efficiency and margin improvement. You run into a point at some, you run into a situation at some point where it's a trade-off and you're going to have to sacrifice execution and in an industry where execution is really becoming the only thing that you can sell as how you're differentiating, it's like I always was too scared to put that at risk.
Speaker 1:Yeah, and I think that is going to be like going back to your post, why someone show me AI that's being used across the entire operation at high volume right now. You know what I mean. And we're not talking about the AI that's running automation, like the green screens and Navics, all those that are fully automated. We're saying like across the operation being utilized. That approach will continue to, I guess, be challenged from that standpoint. Just again, it terrifies me to jump over there, give up your core values at the expense of something that we don't know how it's going to turn out.
Speaker 1:I think this is a good. I guess the point I was trying to say is AI right now is a good example of being a fast follower, and I think everybody wants to be a fast follower and that's why it's like there's not a lot of arms being raised saying, yeah, it's deployed and we have high volume use across the board here. Look at all these examples, right, so like it's it's we're talking to underneath the scenes and I understand because it's it's it's growing, but I think it's AI is one of those. It's okay to be a fast follower and see how it's working other places before I go, my core values or you know core values and check.
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Speaker 2:What's funny about that comment is I actually heard the same thing from an AI company, and I heard it through the lens of somebody who's about to start an AI business. And what they said? I was like do you worry about being too late? And they were like no, no, no, I like coming in at this point, I get to see how everyone else is screwing it up first, and these guys are the ones that are taking the chances with these customers and screwing it up. And then I'm here to understand what they did wrong and apply it effectively so that we don't have that problem. And the thing that I'm hearing is most of these tools still have too many kinks and it's not to say that they're not effective in one way or another, but I've heard from a number of brokers that have fired their appointment AI company because they found that it's not an end-to-end solution. They're not saying, hey, we will own your appointments for craft hines. They're saying we'll try to own your appointments for craft hines, but if there are exceptions, you're gonna have to handle them right and we'll kick it back to you and welcome to logistics, where exceptions are the rule. That's it. And one of the things I told these guys is like you should find a way to own the end-to-end execution.
Speaker 2:If I was selling AI to these people, I would not sell myself as an AI company. I would sell myself as an execution company and I would build the infrastructure within it so that I have AI supported by people, which will still be cheaper than it would be for you to have your full-time Ohio staff scheduling appointments. And then what I'm selling to you is that if you give me your appointments for craft. You don't have to worry about if it's going to get kicked back to you Because whether the technology executes 60% of it and my people do 40% all you care about is 100% of the loads are going to be scheduled when they're supposed to be.
Speaker 2:To me. That's how a broker wants to buy technology because they know it's going to work, versus like be a partner with us and like it'll work sometimes, but like maybe not other times and we don't have the staff to support you when it doesn't work. So you have to have your staff kind of flexing from when they're involved and not involved, and that's the opposite of accountability. Like you don't want someone, you can't hold your rep accountable if they get to point the finger at the technology when it doesn't work.
Speaker 1:And that's that's like. Our next big focus from, like, the module side is like how do you, how do we handle the exception management when ai has a non-compliant or an exception? Where does it go? Who, who do we know, got it? Who's responsible for it? How do we know it's being taken care of? You know, um, because it's you know it's. It's a little intimidating jumping into some of these deeper portals with command prompts and everything trying to find the root problem. You know, and we both know, we don't want to be on the tail end of a communication with craft or whatever customer saying why didn't you pick this PO up? You know, and I got to send a full truck at my cost because the robot, you know, didn't know a J was a J type of shit.
Speaker 2:You know didn't know a J was a J type of shit. Yeah, yeah.
Speaker 2:Have you ever hauled for a Maricold. I have paid for way too many one-off PO full truckloads for a Maricold. A Maricold is one of the most. They're not a bad customer, but just challenging in terms of their PO structure, where you could get sent 20 different POs and it's on you to make sure that they all end up on the truck. If you show up to the warehouse, they're not. They don't care how many POs they load you with. They're going to load you with whatever POs you ask for, and that's it's really important to get that right.
Speaker 1:Yeah, One of those feelings, the last feelings of the war, when you like, you know it immediately, damn it. There's not even a debate about it.
Speaker 2:No, you know you're not charging. You just go check what the rate is. You're like what did I just give away Three grand from Atlanta to Boston right now. Wonderful, Send it Revenue zero, exactly.
Speaker 1:Put it on the house count Yep.
Speaker 2:That's funny, all right, well, let's, we've, we've dove. We dove headfirst into ai. So I appreciate you giving me like 20 minutes on that. Um, I do want to kind of, I want to give my listeners some understanding of kind of how you did it, and when I say how you did it I mean like your 10 years, and how big is the business today? I forgot to ask you that.
Speaker 1:Uh, from revenue side wise yeah, around 220. On the logistics side, um about just over, you know, depending the last couple years, you know 315 to 340 in top line. Um, I know the expedited to the fleet and warehouse side, about 50 to 60 people on that side and revenues around 25 to 30.
Speaker 2:What is the fleet and warehouse side? What is that function of the business?
Speaker 1:So it's still under E's, it's E's expedited and it's subsidiary. We got asset fleet transportation and we have operated three warehouses.
Speaker 2:Oh wow, Why'd you choose to get into that business?
Speaker 1:Go in the role of listening to customers and trying to get more sticky with them. And I just think, as a logistics provider now and moving into the future, you know, now that we've got the AI talk behind us, I think companies that will continue to grow are companies that harness the ability of multi-solutions, and I think assets will continue to be increasingly important. And, you know, not saying we want to go own a massive trucking company or own 5 million square feet, but knowing how to navigate it and operate it and have the ability to scale one if we need to, I think is very important. So it's uh, it got us into it about five years ago. Um, you know, the fleet side really started as one straight truck and a couple trailers just to infuse in some drop trailer and I was seeing what I was like paying drop trailer loads. I was like shit, I'm gonna get some trailers and I broke the cardinal rule, jumped over it, you know like I like it though.
Speaker 1:Yeah, I think it's, I think it's the right move it had, it's, it's, it's come to be that way and I agree and I'm happy we did it, because it makes you know the tools on our belt for our account managers and ourselves, team, to offer to customers, make us more sticky right and be able to do those things. But it also just expands our internal capabilities of how we use our resources. You know it's like in a competitive business. You know, if I have one responsibility as my position is to equip our team with all the resources they need to be successful 100, you know 100. So giving them access to trailers, give them access to, hey, let's cross stock or let's start pitching warehouse, um, it grows you as a company as well, you know, and it pushes us. So again, it's, you know, to tell you that just ease, have some ambition to be a massive trucking company. No, uh, right, uh, have trailers to support our customers needs. Right, have power units, you know, position them and do some, you know, full distribution.
Speaker 2:I think it's a good play there yeah, you don't want to be a massive trucking company, but you do want to be a massive logistics company, I think, and you can't do well, maybe you can do it without that stuff, but it's a lot easier to do it with it. And you know, I always come back to. I spent so much time in my role just thinking about the interaction between a sales rep and a prospect and just the conversation and like what does my team have to sell? And maybe more importantly or as important, what are they selling against? What does the competition look like? And I felt like I was kind of almost the guy in the pool. What do they say?
Speaker 2:The guy in the ocean when the tide comes in and he's swimming naked? I've heard that one. And all of a sudden you're just standing there naked. I haven't heard that one. If you're just a transactional broker, he thinks you won't exist. And I think it's important to define transactional because to me, transactional broker is a pure spot broker. That's just kind of supporting you on the spot market. There's no depth, there's not even like contract rates that you own, and I don't see how those companies survive long term.
Speaker 1:It challenges me as well. He's been fortunate how we've grown about 65%, 70% of our business dedicated and that's kind of always been our focus. We're a split model as well, so we don't have the massive floor of cradle to grave which, again, it works for some and it just it's never been our, you know. You know, bring people in to focus on certain tasks. I think, like you said, it's a. It would terrify me because I remember at one point ease was all spot and that's a terrifying it's, it's, it is, you know it's like, and a lot of it was automotive too. So it's like you know it's, either I miss it or I shut it down, I'm screwed either way. You know, um and it's, but it does force excellence. And then if you take that excellence and know how to convert spot into strategic or enterprise right, then I think that's the sweet spot. And, like you said, it comes with execution. But then it comes to how do you get more sticky with customers? Right, I was.
Speaker 1:You know what's the cardinal, you know what's the biggest feedback that sells get from prospects right, asset, way, you know, and I always tell ourselves represents should be a two-part conversation. The different, you know, the difference between us and asset is. I don't have the reason to tell you why I didn't pick up the load outside of greed, right. And if you still only want asset, let us see what your opportunities are and we'll see if it makes sense for our fleet on there, right. But I, you know, from a standpoint of wanting to make sure that we honor our commitments at all times, which that's what's made us successful, it would be doing a customer a disservice to say, let's only say this truck, because this truck doesn't show over my driver's sick.
Speaker 1:I want to be able to, I want to be able to cover my commitments at my cost, because it's when we signed up. You know, on on the flip side, customers, they provide opportunities, but there's no expectation for them to have to give you margin. I always tell ourselves that's like for us to create, you know. So you know customers can provide opportunities. You got to provide service, you know you got to create your own margin, but then you got to figure out a way to get sticky and it's it's hard, and it's it's hard in a very transactional world, world, like you said.
Speaker 2:Oh, yeah, you know especially because there's there's a you know the old serenity prayer, you know the idea that, like, there are certain things that are within your control and that's what you have to focus on, and then there are things that are not in your control. And one thing that I've always found to be true in our industry is, every year your customers take a position, it's either we are reducing the number of carriers we're working with, which is usually what it feels like it is, or it's we're adding a few, very specialized, if it really makes sense, but like ultimately it's not in your control. If you get that call from a shipper who says like hey, just fyi, we're looking at downsizing our network from 200 to 150 or from 50 to 30, right, but what is within your control is like your position within that company over time and how the services you provide develop, create that stickiness and it is way less likely for you to get the cut. If you're entrenched in their business across three different modes, if you've got some warehousing you're supporting, if you're doing some of their expedited and you've got contractual over the road volume, you're in such a better spot I use spot on purpose than the guy who does five spot loads a week and he just lives on the portal.
Speaker 2:Does he have less risk than you? And that's what a lot of brokers want. Is less risk? Sure, but like that's. That's. That's like a different problem. And you know, I always looked at contract freight as insurance, like you have to have it and if you don't when the tide comes in, like it would have been a really hard time for you the last year as this tariff stuff started to be just a purely spot automotive player. I mean, you probably would have had to lay off a ton of people.
Speaker 1:It's brutal and it and it also materially challenges where we want to be as a company to carriers. I don't want to be the one that offers carriers $145 to start their truck. You know what I mean. It's like it's just not our model, you know. But it's, you know, like good freight is earned and like great customers are retained with execution, and I think that's just like it's proven in every size customer. You know it's like, yes, we understand the customers will always, there'll always be a price driver. We get it.
Speaker 1:But, um, when we get, you know, internal feedback, this customer it's hard to, you know, to land loads or, uh, you know, get good margin on it. I always say, look, I I'm always hiring people that can find customers that have the 20% margins right off the rip, you know. But always those are great, I'm always, you know, unicorns, yep, but until then you got to go prove and you got to earn it. You got to earn the trust and you know you get opportunities and then it's on you to make the margin All right. So, yeah, you to make the margin right. So yeah, and it's it is again, as we move forward the future, like I said, it's easier for logistics companies now to be good, but the heavy transactions, you know.
Speaker 2:That's why we really try to focus on getting more sticky, more strategic with our customers, but also our solutions was automotive an intentional focus early on, so you just didn't realize what you were signing up for and then that was all you knew.
Speaker 1:Well, the mindset behind it was right. I liked the industry because opportunities are plentiful. So also where we are located. You know we're we're kind of in that automotive. We're definitely in the automotive pipeline, right, and we got a massive OEM just right outside the city. So just having that exposure. We're wanting to grow right and learn best practices. If you get the opportunity line production automotive forces you to do it. It builds excellence. It builds 100 gps compliance. It builds 100 sla. It builds a true 24 7 service right.
Speaker 1:The other attraction to it was I don't have. It was me and myself, right, um, and I can't, I'm not, I can't go compete with a lot of companies at that point. So how am I going to grow? So if I'm going to service an industry that has continuous opportunities 24-7, right, my competition is sleeping, I can continue to kind of itch that revenue up to get more people on. So you know there was.
Speaker 1:It was a combination of the attraction to it just because of where I'm located, right, but also that continuous opportunity of round the clock opportunities and what I was noticing from my experience of the you know the other company I was at not saying that they practice this way, but just from the companies I learned while I was. There was a lot of the largest companies out there, right, they had 24, seven, but they were more just track and trace right, full execution at two in the morning to get quote truck booked. All that I think. Maybe you agree or not. I don't think it's as plentiful as everyone makes out to be when they say we have two 24-7 right and shots fired potentially across the whole industry.
Speaker 1:So I apologize, but you know, uh, you know I started a company so let me be ambitious. Um, but that was it and we learned a lot. You know, when you learn, response time is important and again, you cannot dispatch a truck without it being on gps. You know. I mean, we've had people come from other companies and think I think it's wild that our gps compliance is a hundred percent and that's the daily expectation you know, yep, but it, yeah.
Speaker 2:It does seem crazy, as someone who was never an automotive, that that, like knowing my own experience, we struggled with that. So I get um and it's wild. It would be surprising me to walk into a brokerage and them to be like we're at 100% GPS tracking compliance. I would just be like I think you're lying, I think you're manipulating.
Speaker 1:I know and I'm always up for the fax checks on that and we do it after. But it's one of those things. You have a few of those calls and you need to know exactly where the truck is. You're born in those moments and that's where all of our processes have been born and grown. Is preventing those type of situations where where's the truck and I can't answer it right away, so it takes five or seven more minutes or it could possibly be rebooking the whole truck, but in the moment when you need it it's exponentially. You know better and those are when best customer, best customer moments are are formed.
Speaker 1:I mean I remember it was like nine months in of doing uh mine automotive and it was uh in the winter and from Misagwita down here close to Columbus, 294 miles, truck got stuck on Ambassador Bridge because of snow. I had sent email updates every five minutes. I mean when I had to go down to the plant to explain because the line shut down. I mean I had 40 pages of email updates every five trucks one mile. You know what I mean. I had 40 pages of email updates every five trucks one mile. You know what I mean.
Speaker 1:And that was a. That was like a turning point in the relationship, I would say, because they even said come in these meetings and some there's no communication, that we had no updates, right, and all I had. You know, I didn't have any fancy technology, I literally had printed out just our email chain. Great, I didn't know what a 5Y or other shit was. But you go through a couple of those and then you take that automotive service and those expectations and you apply it to the food and beverage or CBG industry and you know it gets eaten up when they say you're going to honor your commitments, you're going to be available, you're going to honor your commitments, you're going to be available, you're going to have true operations, right, you're going to follow through with what you say. And it kind of grew us in those industries At.
Speaker 2:Molo we built a great company and I'm proud of the work we did. We knew when to ask for help and sometimes that meant going outside of our own company. I'm proud we built an ecosystem of trusted partners like Metaphora. When we needed differentiated industry expertise in business consulting or technology services, we looked at Peter Ryan and the team at Metaphora. They've consistently delivered value in the transportation and logistics space for over a decade for mid-market and enterprise brokers, for shippers, carriers, private equity and freight tech companies.
Speaker 2:At Molo we use Metafora to solve problems we simply couldn't on our own. Metafora is the only partner you should trust to help you win, whether that's doing ops and tech diligence, growing revenue, optimizing spend or selecting and building software. Go check them out at Metaforanet. That's M-E-T-A-f-o-r-anet. Yes, it's, it's your comment around 20. I love that story and I I'm going to share a similar one. Um, but the comments around 24 7. I do believe that, like you said, it's almost like it's not really 24 7 and and I was in that camp where it's like we had people who could answer the phone at 1 o'clock in the morning but they couldn't solve a problem. So how do you set up the structure to really solve the problem.
Speaker 2:One of my first big accounts as a sales rep when I was like 23 was Lasership, the East Coast package delivery company, final mile delivery company, and we had dedicated lanes from Charlotte to Tampa and Charlotte to Miami.
Speaker 2:Every night at 2 am they picked up and they delivered straight through. It was like 600 miles or something like that and they would deliver at 2 pm with teams and if at 2 am the driver hadn't shown up, I was getting a call on my cell phone and there was no other solution to handle this because I couldn't ask the after hours team that was making I don't know 15 bucks an hour to like solve the problem. Because this guy was calling and if the truck wasn't there and I didn't know why, he was mother effing me and cause in their minds it was like it's it's not one truck, every truck has 2000 packages and if it doesn't make it in time for the sort, then those 2000 packages all don't deliver that day, which means that 2000 people had missed deliveries. So I ended up eventually, I think, giving up the business Because my girlfriend at the time was like you can't keep taking calls at 2 am every morning.
Speaker 2:But I didn't have a better system. I didn't know how to build a system that was better. It was just a sales rep at the time and my point in this is like this was at Coyote, we were as a top brokerage.
Speaker 1:This was at Coyote, we were a top brokerage but even then we didn't have systems in place to represent 24-7 problem-solving coverage. It's hard, it's not just we found it and broke down and tell them it's, find a recovery, find a cross-doc, take 24 pallets off to the side of tennessee road, you know, and get it going. It's not like you can't just say, hey, it broke down, I'll be there at eight, like it's. It's like uncomprehensible on how that's received on the other side.
Speaker 2:It's like yeah, not no, you know yeah, uh, can you explain that a little bit, just because just for my audience that doesn't understand, maybe automotive, like what are the expectations and then what are the ramifications when you are late and the line shuts down, and what are the cost ramifications?
Speaker 1:I'd love to just yeah, I mean it's, it's a high expectations at all times. It's no fail, right. You know, uh, the oems that you know we support, specific to this. You know their inventory, what's on? These trucks are going right off the trucks right out being plugged into plants. These plants have 5,000, 5,500 people working. There's a cost per minute, there's a cost per hour and there's production and there's post-production. When you shut down and you're late with a, with production parts, it's not just well, you know, go start another line that you know the entire line start, all the way back to the new white bodies coming in, right. So when you talk about what's the expectation, it's no fit. You know our motto is don't shut down the line at all costs, right, like, no matter what. Don't shut down the line, whatever it is. I mean we've set up helicopters, we've sent jet. They're not jet ski snowmobiles. I mean you don't shut it down because the the math is, if it's 10 000 bucks a minute, 5 000 bucks a minute, right.
Speaker 2:And that's what it is right.
Speaker 1:It's the numbers of that astronomical if you fail right, and depending on what planet is and what line, if it's line one, production at the, you know, the main OEM that's doing 6,500 cars or something, right, I mean you could get up. You know 12,050. I mean it gets it, gets there, right, so it, when you, when you are in that environment right, you, environment you can't just say we're gonna just handle it tomorrow. You got to solve it. So those expectations and it's they need to know when you're gonna talk to me next. What's your plan of action? How are you gonna recover it? What are you gonna do If you shut down online? It's depending on the agreement and the contract, those costs, can you do the math? You know, take it at five dollars a minute or five thousand dollars a minute, right, yeah, I mean when you start it's astronomical.
Speaker 1:I mean it really sounds like one load can destroy a year's worth of profitability on an account and and the biggest, the you, one of the biggest drivers of how you handle it too. Again, what's put on the to the side that we all understand that you got to have sound processes and compliance right Is communication. I learned that from that same plant manager that ran me through the ringer, but my email updates started right Was when you tell me I can do things. I can. I can call an early lunch or I can repurpose the line you know the line to maybe do a facility clean. Right, so they have these ability to get you more hours, right.
Speaker 1:So you are super proactive. And you're super proactive right. And that is to the point of, if you see it, if you saw a pain there three times in a row, why didn't you call them type of deal? Every minute counts. So you learn to be so proactive. And so, on top of it, that those things like being 100% GPS compliance, you start to just say fuck it, it has to happen. Right, you know it has to right. Say it has to happen, right, you know it has to right. So, yeah, I mean it's, it forges you in fire and the expectations are high. Um, but again, I think it really instills good core processes that are that are transferable to all industries. Right, I know that there are food and beverage customers that are that are hard to work with just by their demand and CPG and all that, but I think that if you're successful in line production automotive, it's very transferable to other industries, just from an expectation standpoint.
Speaker 2:Yeah, I mean I would you know. Again, I'm always kind of sitting in the camp of how would I be selling this business to customers and how would I sell it to prospects? You know you could go, you could walk into pretty much any shipper and if you're spending your time telling your stories of your experience in automotive you're instilling confidence in them that you can support their freight Sure. I mean, it's just a very you know, if I go in there and I'm telling stories of hauling paper rolls that have two weeks to deliver, I'm not necessarily instilling a ton of confidence that I've built an operation that can handle the hardest of hard. But no, I think that's really interesting.
Speaker 1:It is and it just teaches you.
Speaker 1:You know more on the manufacturing supply chain, that how it trickles over to all the other industries Right, and because it's not just to the plant, you have to remember the racks that brought the parts and also have to get back to the supplier so they can put the parts back on the racks and get back on Right.
Speaker 1:So every, every way is important, right, and it's just. And then you see, when you know autos have their plan shutdowns and when production's low I think maybe because we're, I'm so in tune with it I see how that impacts the. You know the national capacity, right, when they take their three-week shutdowns mid-year and at the end of the year. Right, we see that. And I see all this open capacity going on because all the autos are down and you get all these. You know you have to think some of these plants are running 6,500, you know for 5,000 match per route today, right, a day like shuttle to shuttle, and that stops for three weeks. You got all these drivers that are hitting the market and all that stuff. So it's very interesting once you start seeing how the manufacturing ripple effect across multiple industries plays a part there too.
Speaker 2:I'm curious to talk about that for a second. If we zoom out and think more thematically around the reading the market in general and understanding where capacity is going, where demand is like, how do you guys evaluate the market and evaluate kind of if, if we're going into, if, if things are changing, if things are turning for the better? Like you know, it's hard to be a company like yours that is kind of committed to executing on the things you promise, when in an industry where the only thing that's guaranteed is that the price of the truck from today to tomorrow to a month from now is likely to change, whether it goes up or it goes down, and you just can't necessarily make that same change on your contractual rates if they're 65 to 70% of your business. So it's really important for you and your team to be in tune with the market in a way that you can effectively price freight, and I'm just curious how you think about that because it's a really interesting challenge.
Speaker 1:Yeah, I mean I think we use I know we use a lot with you know we we see our pre-book percentage on dedicated and we see how that gets challenged, right. So once we start seeing pre-book drop to you know 60%, let's say on dedicated, we start. You know that's kind of like future looking, that we can start seeing All right, and why is this happening? So it raises some alarms. We see our spot conversions start to you know drop under 40%. Let's say that's typically all right. Do we need to tweak our rates or we're not keeping up with the market? Some of the outside factors that we look at are customer-specific, especially for automotive is what is their success rate to production schedule? How many consecutive weeks have they been at 90% or more than the planned production schedule, right? How many routes are they canceling? Another big one for us is when we start seeing flatbed capacities start to increase into T1 suppliers and OEMs right, because that means we're starting to see some investment in retooling, right. So that typically thinks that we're going to see a spike in production when we start seeing those investments On the automotive side. We take that into consideration as well for 45 day projects or six month mass pro projects type of deal. A lot of that can transfer just from a general capacity side. Some of the food and beverage right, I think temperature capacity is just so crazy.
Speaker 1:Since kov, like you know, I I've I told you that I that I, our indicators are 100 accurate.
Speaker 1:We both know I'm full of.
Speaker 1:You know what it has challenged us, though, since COVID, and I think we've done a good job of actually being this far, and that's the first time we've said the word COVID yeah Right, you brought it up, I didn't, but we've we've evolved a lot of this company. We have some great brains here, and you know some guys that you know that are very passionate about freight that are really challenging us on how we look at data and how we apply data, um, and it's again we a mix of green screens, external market rates, but it's really our goal is establishing that ease rate and how we're buying into the market. Um, so I could tell you it's when we see lumber go up. I could tell you that you know copper and all that, but right now, all those, a lot of those you know off the bean path indicators have been so materially challenging the last couple years like I'm fact checking them every single day, you know what's your general thesis on when things start to pick up or if we've still got a long way to go?
Speaker 1:I love that question, you know from the feedback that I get Look into that crystal ball.
Speaker 1:Right. I think that we're going to continue. I think you know June and July were pretty challenging, just from you know, continued bottom recession. Again you have an extended shutdown for auto. I think this year will continue to be pretty challenging. I think we'll see a spike up back to school. I do think that you know mid Q1 is going to start to start seeing some some role, some some thunder, and I really think that's going to be right.
Speaker 1:Again, I'm using a lot of automotive but I know that there are OEMs coming out with 27 new models next year. I know that they're starting new plants and I've seen the commitment. I've seen Like. So, like you know I for how much I want to say tomorrow, I've accepted it.
Speaker 1:Temper expectations, yeah, but again, I think, for the companies that have been around for a minute, we've all learned how to navigate in this bearish kind of market and we've really focused on preparing for the bull market, so to speak. So we've made changes. I across the industry since you know 22. You've seen a lot of kind of restructuring of how companies look at, how they operate. Right, we've all gone a lot smarter. We've all for the fortunate ones that were able to figure it out and I know there was a lot of unfortunate situations as well. But being able to navigate this long in this type of market, I think, and preparing for, you know, the bullish market to come up, I think it's it's been a good learning. Very long, very long learning curve, but I think it's making this long learning very wrong.
Speaker 2:I gotcha, what would. What would you say has been like how do you keep the team motivated in in this type of market? Like, what kind of things can you do to, I don't know keep the fire lit in the belly?
Speaker 1:yeah, I mean it's, you know, ease. We're very fortunate here and you know not to continue to reference, but I love doing it because I it is one of the companies I look up to Coyote 2012, 2019, there's a swagger inside these walls where people are super proud. I got a lot of feedback. That's how it was back in the. I never made the cut to even be considered by Coyote, so I don't know, but I've been told, probably that Ohio State degree.
Speaker 1:I think of of what? But there's a swagger. So I think there's the swagger of ease that keeps a lot of positivity going on. But I also think introducing some technologies like we did you know the the amy, ai, um getting people excited about new solutions like expanding fleet or warehouse, just letting them see a continued investment of the company growing and preparing for it, keeps them up At the end of the day. Nobody likes seeing losers on dedicated and 3% margin. It does wear you out, but it even goes all the way back to our investment in 24-7. You know like 25% of our company domestically is support 8 pm to 8 am, right, so like it's….
Speaker 2:Wait, 25% of the company domestically works 8 pm to 8 am. Mm-hmm, that's crazy.
Speaker 1:Mm-hmm. So we do a four-day, monday through Thursday, team second and third. Then we run three, or what is it three or four tens Friday, saturday, sunday, yep, right, wow, second, third. Yeah, that's different.
Speaker 2:I mean, that's different. I'd be selling the shit out of that. I do, I do.
Speaker 1:Trust me, I sell the shit out of it and I think for all the shippers listening you need to listen to, andrew, how amazing that is.
Speaker 2:Call us at 1 am. Yes.
Speaker 1:But no, I think also these are the times where you really need to make sure that people can have that work-life balance. When you're beating your head against the wall all day and it is very frustrating and for them to know, like, look, I can put my phone down and if it's absolutely critical, right, I'll get called, but there's a good chance our support is going to be able to handle it as well, right? So, like, you got to take the small wins. You know, putting points on the board every day is kind of how we look at it.
Speaker 2:Just like small wins. You know, maybe we didn't hit our margin number today, but look well, you know we improved three more processes or something. Yep 100, I'm with you. What would you say has been the hardest test you've had to deal with in the time that you've been at ease?
Speaker 1:oh, you know, started in a hard market in 2014 and then, um, you know, had ups and downs, then figured out, you know, navigated the C word through that, um, you know, through the growth spurt of the following years. You know, 22, 23,. You know, uh, 23,. You know, uh, we grew, um, but you know, compression across the industry.
Speaker 1:So, um, you know, I'm real life decisions to make and it's some of the hardest decisions you have to make is when you have to 100% put your business hat on, because it's such an emotional business, like you expect, when you start and you're out on the ops floor and you see you're working like shoulder to shoulder with everybody that's helping you run this company right. It's such a ridiculous change, like the. You know that no one you can't be prepared for then have to go into a room and act to put a business hat on and be like I have to make decisions based on numbers because it's just, it's the reality of the situation, you know, and it's you know that was something that having to make decisions that you know have to part ways with some people based on decisions that I allowed, and you know I always take 100% responsibility and uh, it is, there's, there's blows to your ego, and then there's that, and it's something you never, ever want to, ever, ever, ever, ever, ever, ever have to do. So being more in tune with how important it is to hold people accountable. Being in tune with, obviously, if we have continued margin, uh, compression is the company structured in a way that it can support and how?
Speaker 1:You know, so you know, learning that in in real life situations over the last couple years, um, it's definitely hard, it's hard, it's the it's, it's the hard, it's the hardest thing and it's I wish, I don't wish, because it's definitely hard, it's hard, it's the it's, it's the hardest, hardest thing and it's I wish. I don't wish, because it's I. I don't think I could be that disconnected, but it's, it's so hard to just put that business hat on. You know, it's like every day, when I wake up, before I go to bed, I think about. It's not just my kids, all the, it's everybody that's helping us move the ship forward, type of deal, right? So you know, like I said, there's ego blows and there's that, and it's at a core level, so deep that it materially changes how you operate.
Speaker 2:Yeah, you talk about how emotional the business is, about how emotional the business is, and I think that I think one of my flaws as the CEO was allowing my emotion to drive too many decisions sometimes and trying to save someone pain whether it was my ego or an employee by not doing what the business necessarily needed, but more so trying to appease again either my own ego or their livelihood or whatever. I think that there were mistakes I made and somebody told me this quote the other day that they live by Now it's stick to the plan, not your mood. And it like really struck home with me like huh, if every time, because like it's, it's, it's a grounding, it feels like it's a really good grounding technique because when you're clear-headed, it's easy to to stick to the plan. When things are in chaos, when things are emotional, that's when you can't necessarily trust where your brain is taking your decision-making.
Speaker 2:It's like how people say you should never make a decision when you're angry, because literally, when you're angry, there's a physiological change in your body where your blood all rushes to your head and then it becomes almost impossible to clearly think um and make decisions and so like, if you can, if I can get myself to ground in those moments and remember like stick to the plan, not my mood, like my mood tells me I want to help this person or make this choice because it'll save my ego or whatever, but the plan, the plan we've been working on for 10 years. We put blood, sweat and tears into the plan and if I, if I deviate from the plan to appease my ego or to appease this person or my mood, I'm giving up a lot of hard work that brought us here I know it's, it's yeah, that's a great way to put it.
Speaker 1:It's like the confidence that allows us most likely to be in these positions is the same confidence that challenges us to accept defeat, you know, and it's not so much like look, like we say we've been in brokerage, we can accept defeat and move on. It's one of those things you know. It's like at those such high levels where I can figure it out Right and yeah it it's, you're right, you get so cloudy because you just don't. It's, you know it's the fear of. You know it's like fear of success and fear of failure, both equally as big right, like they're both terrifying and they're both hard to navigate and they're both hard to manage.
Speaker 1:And there's not a, there's not any business book at least that I've come across I can equip you for those situations at the most extreme, right, and it's like a lesson learned and, god willing, you take it into consideration and apply it Right so you never, like I said, said you never be in that position again. Um, but it's, yeah, it's, it's. It's a hard-fought fight, but it's. I think what also attracts me to is just because of the emotional side of of logistics, of how much teamwork there is there too, so it's like it's it's a double-edged sword there.
Speaker 2:I I don't know if I could be in this industry where I know we wouldn't be where we are today if it was not a personable business, or whether, like we didn't have humanity in our, in our core, you know yeah so because, because, like that's what carries you through the really really hard moments like this business gets gruelingly challenging at times in the down markets, when the opportunities aren't coming in and you're sitting looking at your P&L and it doesn't look how you want it to and there's no quick answers. But being able to turn and realize there are people to your left and right who are in it with you, willing to go to the ends of the earth with you, because they believe in you and what you all are doing, that's what carries you from one day to the next when everything else looks darkest.
Speaker 1:It's what gets me up every day, right, well, my kids and my wife it's. It's it's like the confidence that people have in me that come in to help us move forward is I will do anything in the world every single day. You know that's. You know. I would like to say I don't golf because it's I'm not good at it, but it's also it's because I want to be here and I want to always drive us forward. You know it's like, and I I love what I'm doing. I'm very fortunate to have amazing, smart people around me to help do it.
Speaker 1:I think, like you said, we're at the cusp of this industry where, for all the things we talked about type of solutions, ai right, like it's super exciting right now, right. And if you got your thumb on the pulse and you have the right team, and if you've been able to weather the last couple of years, I think that, you know, depending on the model of your company, I think we're we're in good spots. You know. I think there's a there's a lot of fun to be had in heartache, but fun to be had in the upcoming years.
Speaker 2:I'm with you. I'm excited to see it happen.
Speaker 1:As my don't think about it every day.
Speaker 2:Well, listen, man, this has been great. I appreciate you giving me almost 90 minutes of your time and telling me more about your story and how you've built this awesome company. Any parting thoughts for our audience?
Speaker 1:Well, just first off, I appreciate you and what you do on this podcast of bringing shippers and suppliers and vendors and everybody together and, like we said, I just had a minute ago, like reminding the humanity aspect of the industry, so I think it's super cool there. Any last words If you need any transportation or warehouse or logistics services, please reach out to east logistics. We're 24 7.
Speaker 2:yeah, you are that's all we got folks, thank you.
