Hey everybody, it’s Patrick Escolas with another Banyan Technologies Tire Tracks at Connect ’24 in tropical downtown Cleveland. I hope the sun's not too much for you, Chase.

You know what? We're staying cool. We're staying cool.

I have with me Chase Smith of MODE Logistics or is it just MODE? Is it just the four-letter word? 

It's MODE Global.

It's MODE Global. That's right. You're taking over.

Global organization.

I like that. I like that. You're the director of LTL & Parcel.

Vice President of LTL & Parcel.

For Director VP. You got the higher one, right? Whatever the higher one is.

I go by whatever they call me. I just try to smile all the time and just nod my head.

I like that. Well, when you're good-looking and have good haircuts as us, the smile is a great, a great feature.

I get a lot of compliments on my hair.

Me too.

Got some new product.

I like it. So, with MODE Global, and for those that might not have heard or, and I know that you guys have kind of made shifts recently, or if that's just brought more of your pieces together, what is MODE and what are they doing right now?

Well, sure. Consistent with how it's pretty much always been. We work in an ever-changing landscape, right? So, obviously –

Logistics is changing. No way, man.

Obviously, with the continued adoption of technology and the velocity in which it's being deployed in all the various aspects across all the different modalities, right? So, what we've really been focused on is how do we leverage our position in the market as the number one non-asset-based intermodal marketing company in North America? How do we leverage our sixth-largest broker of over-the-road transportation status inside the marketplace, right? And then ultimately, how do you use the technology to really help capitalize on that and perhaps provide incremental value to your customers, especially when they're working up against a pretty tough economic backdrop, right? It's an inflationary market. It's very difficult. Margins are getting tight. So, creativity can do a lot of things for you –

Sure. Absolutely.

– in terms of helping you fix some of those things.

When you say that you use technology, how are some of the ways that technology is being implemented or utilized to do some of these goals and initiatives that you and MODE have with your clients and with your internal departments?

Sure. I'll give you an example. We've got this proprietary technology, we call it VPO. It stands for visibility, predictability, and optimization. The general use case for something like this is when you would want to look at doing modal conversions between a truckload and intermodal or vice versa, maybe you just need to understand where there's an opportunity to do that. Sure. So, what we're trying to do is we're trying to help our customers understand that there are options, and then what do those options really look like?

So, everyone knows for the most part that switching from truck to rail is going to have a financial impact. It's going to be going to pay less. But your transit could double, right?

Then also, correct me if I'm wrong, the train tracks aren't everywhere and the pickups aren't everywhere. So that has to play a part in it as far as where you're going to and where the truck might be more actual.

The tracks don't move.

We tried. We tried.

They may lay some new tracks from time to time, but the tracks don't move.

So, that's got to go into it, too, whether or not it's even feasible for what you're trying to accomplish.

Well, sure. And also, customer expectations, right? At the end of the day, you have to be in tune with the VOC, right? The voice of the customer, right? Can they bake in another two days of lead time so that they can take advantage of a modal conversion into rail? Or is it time-sensitive and do they need it to stay on that truck? There's also consideration such as the value of the cargo, right? You may not want to take a truckload of DVD players as an example and then convert it to the rail. You may want to keep that on a truck, a sealed truck, and you know at all times where that's at, who's got it, you can access the driver, and so forth.

Who's still using a DVD player, Chase?

Oh, I got a blu-ray one. The old PS4, man.

I was going to say, the old Xbox is the same way. I guess I need to change my example.

That might be the way to go. Yes, exactly. No, but that makes sense too, looking at, and I like another acronym for logistic, VOC, the voice of the customer. I think that's fantastic. But you talk about whether or not that they can handle extra change of days, but then just as importantly, as you're looking back at it or for future opportunities, they could decide, “Hey, if we get this ready to go a week in advance, then we can eat the transit days and get the lower costs.” Is that the kind of decision-making you get from these analytics, or is it just right now? What are the big picture of this kind of VPO, the ROI, really?

Sure. This is one of those deals where you're only bound by your creativity. Again, you have to understand what the expectations are around the supply chain fulfillment with your customers and so forth. But yes, we're seeing a lot of success with modeling out different ways to handle the distribution process, right? Does it make sense to consolidate loads for two days and now you're taking multiple parcel shipments and now that's one larger parcel shipment or it's turning into an LTL or multiple LTLs and a truckload, and then into truckload, and then to intermodal, right?

I talked about VPO and it does certainly support the intermodal and truckload conversions, but we are layering in LTL right now. Parcel is going to be coming. So, not only will you be able to – and it does this today, but as we incorporate more modalities, you're really going to have a mechanism that makes it very easy to make these types of decisions when it comes to what modality do I need to do for this particular shipment. Then ultimately, what are the things that I need to know, right?

So, you've got a lot of knowledge that's exiting the industry, right?

It's really hard to replace those guys.

It's hard to replace that tribal knowledge. So, how do you get the same level of output from someone who has an inferior knowledge base, right? Obviously, you can train them, but that takes a lot of time.

How do you train 30 years of anecdotal tribal knowledge?

Exactly. So, what we're doing through the platform is we can compare what you paid versus the modality and the transit. We'll compare it against what the published transit is, what we could do as the sixth-largest broker in the largest non-asset IMC. What could we provide you? And then ultimately, is the information such as a transit time, is it actually accurate, right? As an example, you've got an intermodal lane and it says –

Like the 97% on time for from every carrier every time, right? Yes. Well, yes, you've got to do your due diligence. Is that transit accurate?

This is where it helps to partner with someone like MODE Global who has global scale is that we have a lot of data takes critical mass to be able to do these types of things and that's what we've been working really hard on is how do we use our data to help inform not just our decisions but provide incremental value to our customers when it comes to making smart and informed decisions around how do you tender your freight, who do you tender it to, and what should be the expectations on the service.

So, this will allow us to not only allow us to compare what is visible in the marketplace, market type rates, we're also going to pull in our information and say, “Yes, the rate of the day is $12.50. Historically, we've been able to buy it at $1,100.” And they're saying the transit day is eight days, but we've seen that it actually just 10 based off the business that we have in network. So, we can bring that level of visibility.

Now, they may hit that transit on eight days sometimes, but maybe it's only 10% or 20% of the time.

I'm going to say on average, it might not be there.

But from a planning perspective, you need to know that.

Yes. If you're the exception to that rule when you're in your delivery, yes, exactly, especially when you needed it in eight, and it was there in nine.

So, through all this, Patrick, we've seen a lot of positive outcomes being produced. If nothing else, it shows what could happen if there were some changes that were considered with the fulfillment process. I didn't really mention this a whole lot just yet, but there's also an emissions factor, right? So, we've got the greenhouse gas impact of converting from a truck, usually more carbon producing versus a rail.

Whether it's PR, internal initiative, European, or California kind of move this, everybody's starting to perk their ears a little more on that.

Kind of like what I was sharing with the panel I was speaking on, not only do we show you where those conversions opportunities are and what the impact on the emissions could be, most customers don't understand their footprint. We can quantify a footprint in another way –

Different in the first place.

– you're producing X amount of tons of emissions into the atmosphere based off of this data set and the time frame, now you could effectively reduce that through the modal conversions and here's the impact in terms of tons, right? You can see a percentage reduction, right? This is what we're talking about with some of your other constituents. Now, there's options that can, you can go out and you can invest into projects that help you get to a carbon neutral and you can pick a project that is important to you. Maybe it supports the area of business you're in, right? Maybe you're in healthcare, maybe you're in pharmaceuticals, maybe you're in agriculture, whatever it is, right? The point is, is that there's various projects.

Maybe you're working with Amazon or Walmart, and they're telling you, you got to.

Well, but it starts with understanding what the footprint is, right? Well, if you don't understand, it’ll be hard to make decisions. 

You can't be like, “Well, I bought two tons of offset. Does that that match?” Well, we do 30 tons. So, no. Exactly. That makes sense.

It brings visibility to that. Then again, we're trying to help bring predictability and then ultimately the optimization piece, right? So, not very creative with the acronym, but it's to the point and it's understandable. And when you see the technology and the responses and the feedback that we're getting from our customers is, “Wow, I wish I had this five years ago.” Because, again, we're making better decisions intentionally and proactively, right?

Right. It's also a call out that you're not saying, “Hey, you got to move it this way.” It's simply putting the options in front of them.

It's an option. It doesn't work every time, right? Sometimes, hey, you got a hot load and it's got to go. Yesterday, you could save 300 bucks or whatever it is, but if there's an instruction set down and it's waiting on product and, hey, we got to get it out there.

Mercy the beast. So, we talked a little, you talked a little bit about how you have all the numbers for the analyzation allows you to do this. What kind of a shipment pool per month, per year are you guys touching to grab all that data, because it's got to be an enormous amount?

Sure. Ideally, we would like to get at least a year's worth of data, especially if there's seasonality in your product, because –

Got to make sure you catch the peak and the values.

Exactly. So, if you're a chemical company, as an example, you probably have more volumes outbound during the summer months, so quarters, two and three. The same strategy in two and three may not yield the same results in one and four quarters, because you don't have the same volumetric throughput, so the same level of optimization, or maybe you have to extend the whole period, right? But this is kind of what we do to create value, as it's not a sit-it-and-forget-it type deal, right? We want to model out options that work. We'll come to an agreement on that, right? And then we'll help execute on that and so forth using technology and operational people. 

But then we'll refine that as we go, right? And that's really, again, to back to the VOC, you have to stay in tune with that information because it will change and if they're bringing it to you, it's probably too late. You have to bring it to them.

Be proactive.

Exactly. And the technology helps with that, right? Because it's aggregating the data for you. You're not having to go through every single load. It's not as difficult as it seems when you're talking about a year's worth of transactions and say you've got 50,000 transactions that you're combing through. It’s pretty overwhelming –

It's probably easier to see the bigger picture there.

Well, you're aggregated back up to an ingestible format and says, “Okay, now the date is actionable. It's actionable now.”

With that, one of the things there that I notice is, it's a consultive type approach. So, it's really, because it's relationship, relationship, relationship, where do you provide value? Hey, these are the ways you pick and we just want to make sure you've got that, like you said, actionable data.

A thousand percent.

And one another piece that you hit on that is, I think, it just kind of further confirms the annual or the every other year RFP is dead. If you're running on where you make a decision once a year and just assume that's going to work for the whole year and every month is the same like you said, you got a peak. You got a valley there. There's probably best practices differently in every kind of different timeframe that you got going on.

Absolutely. Not just time-framing, but across modality as well. For us at MODE Global, one of the things that we get really excited about is the opportunity to offer these types of consultative programs to our shippers and there are varying ways that you execute by modality, right? So, you talk about what we've been talking about the truckload market this week, right? And the ebbs and flows with the pricing.

Who isn’t?

So, definitely not a good idea to do an annual RFP because you're going to get crushed in the spot market, right? And you’re going to be looking –

You're going to be promised something and you’re going to be cursing for the next six months. 

Exactly. But then on the LTL side, very much more stable environment from a pricing perspective and rates are continuing to increase. So, it's really beneficial to – you have to make up your mind, how do you want to procure and what's important to you? If you need to procure every year, you can do that. But at the end of the day, the LTL industry specifically is consolidating. So, there's fewer and fewer options. I personally think that there are different ways that you can go about this and it's different by customer, but it's advisable these days. If you have a carrier that is providing a good service and they're picking up your freight and they're delivering it on time and intact, it costs them more to do business each year, just like you.

So, if you can create a relationship and you can come to an agreement on, “Here are the lanes you're going to handle, or here's the volumes.” And that materializes, you're going to normalize the cycle. You may not have to do an RFP every year because your increases or your renewals are coming in at a level that are within budget, and it's something that you can plan around. You have a plan in terms of how you've spread that back out through the organization and capitalize on the sales side. 

And you have a freight policy, there are freight process that you believe in and trust in because there's a relationship behind it that you're willing to go. The less of a just a commodity-driven thing, but more of a partnership.

Tried and true.

Yes. I think with the RFPs, like you said, from a thought process or getting it out there to know what the idea is, one of the best practices that I've heard of as you're talking with some of those carriers, it's, “Hey, here's my lanes. Tell me the ones you want to win. Don't give me a bad number in something you don't want to play in. I'll find that in either a different mode or a different carrier, but don't do something you don't want to do with me. Let's do business we want to do.”

Nobody swallows the apple whole. You can get the apple down, but you don't have to swallow it whole.

Is that a Georgia Sanger? Where is that from?

It’s some Alabama euphemism for you.

All right. I like that. I like that.

Some of my roots coming out. But no, I like to keep a simple analogy.

I like that. That's very true.

But to your point, though, we want them to haul business that works for them, because at the end of the day – so we listen to Mr. Kevin Huntsman present Mastio survey today.

Great stuff.

Pricing was ninth on that list of what's important. The first four, we’re around it getting picked up, around it getting delivered, and around it being intact and on time. So, we want carriers to be able to position themselves to do that as successfully as possible, and if there's not a good lane or bad freight that they want to stay away from, there's a carrier for every stitch of freight out there. There is a position and a place, and there's someone who's willing to haul it, and it will work for that carrier.

The goal is creating the reach, creating the portfolio, and diversifying the carrier portfolio in a way to where you do have the ability to leverage all the good service and keep in the pricing competitive. Because, again, it's not going to be the best line for one carrier every time.

Right, exactly. It's something that, as I've spoken with my clients, I've heard just recently and I think kind of reflects exactly what you're saying, is a KPI that they're trying to chase now that they had before is perfect shipment. That means on-time pickup, on-time delivery, no damage, and the quote is the same as – exactly. That is more important than the actual price. That is more important than the number of transit days, because whatever you told me, just make sure that's what it is, and that is becoming more and more important, as I talked to some of my other clients, where it's less about, like you said, the cost. But if we know and don't have to worry about, when we say get it there, that's worth a lot more than just money. Whatever relationship you have with why you're moving that shipment, whatever that's for, and then also for the fact of life is, I can go focus on loading the next shipment or doing whatever business gets me to ship more out instead of going, “All right, I'm just watching to make sure that it gets where it needs to go.”

Well, got to look at the labor market, too, right? It's difficult. It's really difficult to retain and attract quality talent. When you do get some –

On the carrier side and your own organization side, too.

So, it comes, how do you increase your scale per employee or per head, right?

Right. That's been the question for the past two years.

If you can increase perfect shipment, because what happens when you don't have a perfect shipment, right? Well, now that turns into an email for someone who turns into three more emails and now I got to sign a piece of paper.

And I got a CC by the guy ahead of me and the guy in accounting and make sure everybody else on the same page. The next thing you know you've got five people on a Teams call that could have been done two months ago.

The price is not the cost you paid. There's a difference between price and cost.

We're arguing about $100 when two of these guys is making way more than that and should’ve been –

You burn 200 to argue about it. Exactly. So, you got to understand some of that too.

Yes, that's painful.

It is painful, but it's a very real problem that people deal with. I mean, the carriers are hyper-focused. They want the same thing, because it costs them – somebody has to receive that email.

They have the same labor force issue, and they want it to be accurate when they quote, at the same time, agreed. They want to provide a good product.

This is what I love about being on, in a third-party logistics role, is that we get to work with all these carriers, and you learn what works for them, and you create these relationships, and it gets much, much easier, right? So, you can learn things about one another and then you can come in and really, you're just having conversations with people and you're talking about, well, here's what I know based off what you're telling me and here's how we're going to define success and here's the people that we think are going to help us get there. Because the carriers are going to be a part of that. They have to be.

Yes, one way or the other.

Well, if you don't have an asset to put a shipment on, I don't know what we're going to be able to do for you.

Then I don’t know what I should do for you. Get the bicycle and the wagon out, I guess. But yes, that's a great point, too, because the carriers have to be on board. At the same time, we love to – I think that the easiest person to yell at is the carrier from a shipper. Even a broker side as well, and especially a software side, because you're like, they wouldn't be in the position or the name recognition in a situation where they have the ability to move your freight if they didn't truly believe in a good product and giving their customer what they're paying for and what they want.

If they're extending you pricing provisions, they want to haul your business, and they want to haul it in a manner that says, “I have peace of mind when I tender my freight to this carrier. I don't have to worry about it. I don't have to call people and make sure it's going to be delivered because they consistently show up and they consistently deliver.” So, they want to be able to provide that service because that's how they grow in their business, right? You can't rationalize cost increase or rate increases against an increasing cost basis, if you can't provide a service that's commensurate to the expectation, right?

It doesn't mean that the service is consistent across all cares because it isn't, but the expectation isn't either. And that's what's got to match. Okay, so it's not it's not overly complicated, but you do have to understand there's a difference between carriers, there's a difference in how they provide value. Yes, we're moving kilos and cans so to speak, right? But at the end of the day, how it gets done is a little different.

Yes. So, we went through a lot of pieces here, what MODE does, how determining between multimodal options is best. As we kind of come to an end here, somebody watching or listening to this and thinking, “Yes, that kind of sounds interesting. Does that apply to me?” How do they start or get more details about what they could be doing? How do they get involved with the VPO? What does that process look like?

Sure. So, if you're an existing client of MODE Global today, reach out to your sales rep, reach out to your logistics coordinator, whoever it is that you're working with. We certainly have a company website, www.modeglobal.com. You can go in and fill out the contact me, and someone will reach out to you pretty soon, and we'll set up a conversation, and we'll try to understand what your needs are. We'll be very straightforward with you. If we've got a solution against your problem, then we're going to talk about it and we're going to try to make it work. And if not, then hopefully we can recommend someone to you that can, and that’s the goal.

That's always the goal. If I can't do it, I can at least tell you someone that might be able to.

For those of you that, if you're not sure, give us a call. Again, I'm available or my constituents are available.

We’ll put his personal number right after this podcast, for a good talk, call Chase.

Well, hey, we're good for it. I might answer. I probably will. And if this is something that you're not real sure about, again, it's kind of a risk-free consultation, right? Like, again, we're not –

Because you win nothing forcing something down someone's throat, that it's not a good fit. It's just not worth it.

We're not trying to sell us to an Eskimo here. We're trying to provide solutions that create the outcomes that are desired.

Hundred percent.

And again, that happens a lot, but not in all instances. We want to be straightforward with that, because things do change. And one day, our solution may change, or your need may change, and it may be a good fit, and we want that call back, right? We want to know, “Hey, you know what, they've done us a kindness, they did us solid, and they're good people,” and that's what we pride ourselves on. We want to be good people. We're hard workers, but we want to appreciate one another, and our employees, and our customers. So, we try to have fun, but we want to provide solutions because that is fun. It's fun to win and we want to compete.

That's a fantastic kind of just culture, motto, ideology, and yes, you've been fun before. I know this, but once or twice. But it's fantastic. Chase, thank you so much for all the information and for being here.

Thank you for having me. This is so much fun.

Yes, for being in Connect ‘24 and being able to talk to our clients and some of our partners about what's out there, what MODE'S doing and how everybody can work together and kind of win, win, win. That's our Banyan Technologies Tire Tracks podcast today at Connect ’24. Thanks everybody for watching. We'll talk to you soon. Bye.

Take Care.