May 1, 2018

Werner offering last-mile service to LTL carriers, executive says

Werner offering last-mile service to LTL carriers, executive says

Old Dominion CEO-in-waiting expresses interest in offering.

By DC Velocity Staff

Werner Enterprises Inc., the truckload carrier and logistics company, is offering its final-mile delivery services to less-than-truckload (LTL) carriers, a top Werner executive said today.

The comments by Craig Callahan, executive vice president and chief commercial officer for Omaha, Neb.-based Werner, seemed to catch some of the gathering at the NASSTRAC annual shipper conference and expo in Orlando by surprise. One of those was Greg G. Gantt, president of Thomasville, N.C.-based LTL carrier Old Dominion Freight Line Inc. Gantt also becomes Old Dominion's CEO on May 16, when current CEO David S. Congdon steps down. Gantt, appearing with Callahan on a panel of top trucking executives, expressed interest in Werner's plans. After the panel session, the two chatted to the side of the dais, and then walked out of the session hall together.

Werner launched a final-mile service last May with a mix of its own fleet, LTL carrier partners, and a network of delivery contractors that specialize in "white glove" delivery services, which typically call for delivery and installation of the new item, and takeaway of the old item if there is one.

At today's session, Callahan said that while some LTL carriers will elect to offer final-mile services with their own equipment, systems, and drivers, others may choose to use other providers, yet be able to market such a service to their customers. Tie-ups with LTL carriers open up a key customer channel for carriers like Werner that are trying to understand and capitalize on a mostly unfamiliar delivery segment..

Last-mile will not re-define Werner's future strategy, but it will be an important component, Callahan said. Not only is it one of the fastest-growing segments of transportation, but it is currently underserved, he added.

At this point, last-mile deliveries are being handled by a broad spectrum of providers, ranging from the U.S. Postal Service to the proverbial soccer moms hauling packages in their SUVs, minivans, and other forms of transportation. There are also a growing number of professional delivery firms that are bonded, insured, have federal motor carrier certification, and, unlike most LTL and truckload drivers, are experienced in working directly with homeowners.

However, attendees at the NASSTRAC conference said the latter providers are focused more on the business-to-business last-mile segment, which, despite all the attention being given to residential deliveries, still comprises the bulk of the overall last-mile business.

LTL and truckload carriers have eyed the last-mile market for some time. They are trying to configure their networks to meet a vastly different set of delivery criteria from what they are accustomed to. In addition, they would need to train drivers to directly interact with residential and business delivery customers, rather than to just "bump the dock" and not go beyond that.

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