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Home » Ryder spends $480 million to expand e-commerce fulfillment abilities

Ryder spends $480 million to expand e-commerce fulfillment abilities

Acquiring Whiplash will add 19 warehouses, enable one-day and two-day delivery coverage across U.S.

ryder locations_map_highres.jpeg
December 13, 2021
Ben Ames
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Logistics and transportation provider Ryder System Inc. is continuing to expand its nationwide e-commerce fulfillment network, announcing today it will acquire the omnichannel logistics service provider (LSP) Whiplash--which was formerly known as Port Logistics Group--for $480 million.

The move comes just six weeks after Miami-based Ryder bought Midwest Warehouse & Distribution System, adding that firm’s 17 warehouse sites in the Midwest and Texas to its portfolio at a time when soaring e-commerce activity has pushed U.S. warehouse demand to all-time highs.

Ryder now takes over another string of those scarce DCs, including 19 dedicated and multi-client warehouses across seven states. With the expanded footprint following the acquisition, Ryder’s e-commerce and omnichannel fulfillment solution is expected to be able to deliver to 100% of the U.S. within two days and to 60% of the U.S. within one day, the company said.

Before changing its name in May, Whiplash made some heavy investments in technology, such as its 2020 deployment of over 150 autonomous mobile robots (AMRs) from Locus Robotics into a single warehouse in California, saying the automation would help it handle spikes in e-commerce.

Ryder now says it plans to retain California-based Whiplash’s executive team and workforce as it integrates that firm’s facilities, operations, technology, and warehouse automation and robotics into its e-commerce fulfillment solution within the supply chain solutions business unit.

The two companies expect to complete their transaction in late December 2021 or early January 2022, subject to antitrust approvals and customary closing conditions. Ryder said Whiplash will then add $480 million in gross revenue to Ryder’s supply chain solutions business segment in 2022.

“The acquisition of Whiplash is consistent with our strategy to accelerate growth in our higher-return supply chain business. It also expands our e-commerce and omnichannel fulfillment network and reflects our continued focus on technology and innovation,” Robert Sanchez, chairman and CEO for Ryder, said in a release.

According to Ryder’s president of global supply chain solutions, Steve Sensing, the company has seen e-commerce sales continue to hit record levels and omnichannel retailing become mainstream, causing a significant uptick in brands looking for more dynamic fulfillment services.

Industry watchers said that approach makes sense, since the best way to compete long-term in logistics is by boosting physical scale in order to achieve the economies of scale that produce competitive pricing, according to Jason Murray, CEO of Shipium, an e-commerce platform provider.

As a well-regarded incumbent in the logistics industry, Ryder achieves that goal by acquiring Whiplash, which is known as one of the more modern “tech-forward” third party logistics providers (3PLs), he said. Armed with its greater size, Ryder can now compete with companies like Rakuten and XPO to gain market share in fast growing sectors like small, e-commerce startups providing direct to consumer (DTC) goods like shoes or chocolate, Murray said.

Warehousing 3PL
KEYWORDS Ryder System Inc.
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Benames
Ben Ames has spent 20 years as a journalist since starting out as a daily newspaper reporter in Pennsylvania in 1995. From 1999 forward, he has focused on business and technology reporting for a number of trade journals, beginning when he joined Design News and Modern Materials Handling magazines. Ames is author of the trail guide "Hiking Massachusetts" and is a graduate of the Columbia School of Journalism.

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