A laser focus on service has allowed logistics provider ArcBest Corp. (NASDAQ: ARCB) to thrive during the pandemic, according to Chairman, President and CEO Judy McReynolds.
McReynolds joined FreightWaves President George Abernathy Thursday at FreightWaves LIVE @HOME to discuss the challenges COVID-19 has presented and how the company’s customer-centric focus has allowed it to grow during a period of disruption.
The biggest challenge for ArcBest has been serving every stage of the supply chain with the company’s integrated logistics offering – less-than-truckload (LTL), truckload, ocean, air, expedited and warehousing – while keeping employees safe. McReynolds said the headwinds from COVID have been demanding as ArcBest has worked to maintain service levels for its customers, many of which were deemed “essential” in the early days of the pandemic, which has required reallocating resources to match their changing volumes.
“Essential businesses, ours included, that were still up and running and really had robust volumes, you had to determine how best to serve them, make sure you had capacity sources and you were providing good service for them because of the essential nature of their business,” McReynolds said.
ArcBest was in a good position to deal with the rapid changes given its customer-obsessed focus. McReynolds said it starts with placing the customer’s perspective at the center of the process, which dictates who ArcBest hires and how they are trained. Their ability to communicate with customers is key.
The pandemic has allowed ArcBest to deepen its partner approach with clients, which included embedding staff into some customer accounts to solve their issues as they work through the challenges of distributing products they haven’t before.
A focus on innovation has helped ArcBest navigate the pandemic. The company has provided digital capabilities to its customers for more than 20 years and records thousands of API/EDI connections with clients and capacity providers through its freight-matching services.
“If you’re a company that has been doing that for some time, it comes relatively easy to you to evolve. I think that’s something that’s in our nature,” said McReynolds.
Demand for digital solutions remains on the rise and the company is seeing increased traction within its LTL transactional business. Shippers are able to get quick LTL quotes and procure capacity without having published pricing or a long-term contract with ArcBest. The digitally based transactional component has allowed the company to place capacity into service that may have otherwise been idle.
On Tuesday, the company’s third-quarter adjusted earnings per share came in 50% higher than analysts’ forecasts. After shaking off a pronounced freight trough, tonnage turned positive on a year-over-year comparison in August, accelerating to a 10% increase in October.
