Danish third-party logistics provider DSV said it can grow market share by cross-selling brokerage and asset-based services previously provided under the UTi brand.
Source: DSV
Danish third-party logistics provider DSV A/S this month began promoting its newly integrated North American road transportation organization, designed to create more internal efficiency while offering shippers more services and truck capacity through a single point of contact.
DSV Road North America is the result of combining and rebranding existing DSV offices specializing in truck brokerage with the asset and non-asset-based subsidiaries of UTi, which DSV acquired for $1.35 billion in January.
The logistics provider began opening truck brokerage offices in the United States three years ago and also set up exclusive agent relationships that together are able to tap a network of more than 30,000 approved carriers, most of them small enterprises.
DSV Air/Sea, the global freight forwarding operation, previously arranged last-mile pick-ups and delivery for international shipments, but the DSV brokerage offices enables the company to tap the domestic trucking market and also support the trucking requirements of the forwarding side of the house. UTi, through its logistics and transportation offerings, provided DSV with additional brokerage capability, as well as asset and non-asset based in-house trucking capability.
“What we have done now is bring all those pieces together in a much more integrated fashion,” Jacques Retief, president of DSV North America, said in a phone interview.
Brokerage platforms for truckload and less-than-truckload (LTL) transactions, as well as dedicated capacity, are now unified in a common organization.
DSV, a top 10 global 3PL based on gross revenue rankings by Armstrong & Associates, has a large road transport organization in Europe. The company was founded in 1976 when 10 independent motor carriers joined forces. DSV’s European road division is primarily focused on LTL service, whereas 95 percent of DSV shipments managed in the United States, Canada and Mexico are full truckload, according to the latest issue of the company’s internal magazine.
Retief, who was appointed in May after leading UTi’s road transport in South Africa, said in the article that DSV plans to bring successful trucking practices used in Europe to the U.S. market, including the establishment of an LTL terminal network.
The North American Road chief told American Shipper that having the ability to offer truck brokerage and asset-based capabilities is desired by large customers that want to optimize their networks. It’s a strategy that XPO Logistics, which started out as a pure-play truck brokerage operation, has adopted with the acquisition of Con-way Inc. and its large LTL business. XPO officials say that directly controlling capacity gives shippers confidence they will have access to reliable freight transport.
DSV Road is divided into two operational units: DSV Road handles brokerage and third-party logistics activities such as carrier selection, transportation management, and freight payment; and DSV Road Transport manages outsourced carriers and the company’s own fleet.
It has 17 offices (five in Mexico, two in Canada), almost 600 employees and about 700 trucks, 800 enclosed trailers and 300 flatbed trailers, in addition to its brokerage network. More offices are on the drawing board. Services include dry-van, dedicated contract carriage, flatbed and intermodal.
DSV Solutions, the contract logistics arm, works with DSV Road to secure trucks for its customers’ loads. DSV’s ability to leverage its various capabilities for customers is also demonstrated by the fact that up to 90 percent of Air/Sea highway moves are now arranged through the Road group, according to the trucking chief.
By merging the companies and integrating the products, DSV expects to be able to attract large DSV clients in Europe who have previously struggled to find suitable North American road transport, according to the DSV magazine.
Retief, who is based in Chicago, said the trucking integration costs about $2 million and that half of the DSV in-house fleet has been covered in the new livery.
Although domestic trucking is currently stagnant, “we are very optimistic” that DSV Road can grow by cross-selling integrated services and taking market share, Retief said.