David Broering, President of Non-Asset Logistics at NFI, offers insight into NFI’s acquisition of CAI Logistics and how the partnership will enhance NFI’s solutions, geographic footprint, and customer service.
Looking at the CAI Logistics business at a high level, they operate in three of the four business segments that the NFI non-asset logistics group operates in: freight brokerage, intermodal, and global freight forwarding. We felt like these three businesses offered us the opportunity to expand our expertise by a very great degree across some niches that we think work really well.
One of the most important aspects of this acquisition is the people. We have always talked about the people being at the center of everything we do at NFI. We’re really excited that the existing culture at CAI Logistics seems to mesh very well with NFI’s culture. We’re both focused really heavily on customer service. As we’ve talked to CAI Logistics’ people and their customers, we’ve realized that customer service, execution, and commitment are at the forefront of everything they do. As we’ve grown over the years, that’s come to be our calling card on the non-asset side as well. We’re excited to bring these great people into our organization and really expand on the culture that we’ve been building for the last eight years on the non-asset team. I’m looking forward to bringing a group of people that share a common value in the service to the customers.
The big thing that CAI logistics brings is that, first and foremost, they are an intermodal marketing company (IMC), which is a non-asset based intermodal provider. CAI Logistics acquired ClearPointt which has been around since the early 2000s and they have over 20 years of experience on the intermodal execution side. That depth of experience is something that you don’t find very often in this market and it’s going to bring a lot of value to our customers. CAI Logistics also focuses heavily on the flatbed aspect of transportation from a brokerage perspective, and that’s a niche service that we’ve been looking to build out for some time now. Lastly the global freight forwarding business is heavily focused on both exports and refrigerated transport solutions. CAI Logistics has coincided with our acquisition strategy of expanding on niche services that underpin the total value of non-asset for all of our clients.
One of the things that we’re excited about with respect to this acquisition is the size of the business. With the acquisition of CAI Logistics, the NFI non-asset logistics combined entity will encompass nearly 400 people across the United States and Canada in 14 locations. It will encompass moving nearly 400,000 shipments as an organization and we will be managing and working with over 45,000 partners, whether they be carriers or otherwise. And we will be representing as many as 100,000 specialized shipments between refrigerated flatbed and intermodal.
As we look to the future, the CAI Logistics combination with NFI is going to create a non-asset based entity that will be eclipsing $500 million in gross revenues in 2021 and will be a top 15 IMC and a top 25 freight broker. The combination of those things will offer us the ability to be able to move five times as much intermodal freight as we did in the past, eclipsing 50,000 shipments a year and then moving another 30,000 to 40,000 additional freight brokerage shipments on top of our already existing shipments of over 300,000 that will move this year. We’re looking at being one of the largest non-asset logistics companies in the U.S.
The acquisition will help reinforce a network geography that we’ve been working on with the past few acquisitions. Both ClearPointt and Hybrid, which are parts of the CAI Logistics organization, have heavy representation in the Pacific Northwest so we’ll be adding a second location in both Portland and Seattle. Additionally, we will be adding another office in the Dallas market and then we’ll be putting a new dot on the map in Jacksonville, Florida. We’re confident the additional expanded geography is going to benefit the business greatly.
In 2021, our goal is to simplify and streamline our business across systems, focusing on our technology and the growth of the business. With the acquisition of CAI Logistics, we’re looking to bring their freight brokerage business into our proprietary transportation management system (TMS) that will be fully operational in 2021, which will give them a greater and more enhanced system to use.
On the intermodal side, we’re going to be combining our intermodal operations to work together with both asset and non-asset. We currently have about 300 pieces of equipment roaming around the U.S. on the dry and refrigerated side and we’re really looking to ramp up our scale on that side of the business by providing those services to both existing and new customers. With a focus on whittling down our technology footprint and really empowering our people, we think we have the ability to be able to expand greatly for years to come.
Our global expertise will also evolve with the addition of the CAI Logistics team. Leveraging the CAI Logistics expertise in exports in collaboration with NFI’s current specialty in imports will create a balanced network of operators to bring value to current and future customers of NFI. The combination of focus areas strengthens our global freight forwarding capabilities.
Our ability to offer those additional services and that expertise is something that we think will help propel the growth of the business for some time. Adding in our technological approach and the way that we are approaching the use of technology systems to empower our users, we also believe that there’s going to be a great opportunity to be able to offer additional services to the customers of NFI as well.