Subsidiary of CBX Global has opened four offices in China to provide solutions to customers’ varied problems.
If you were trying to describe all the varied services that CBX Global offers its customers, “cargo wrangler” might not be a bad description.
In the case of CBX Global, which has just announced the opening of subsidiary company CBX Global Asia Pacific with four offices in China, that moniker might be doubly appropriate.
CBX Global operates a wide variety of services, and it hasn’t been reluctant to stray from the beaten track if customers need special services. In addition to being an ocean and air forwarder, NVOCC, custom house broker and warehouse provider, CBX Global has provided trucking and light manufacturing and even mixed chemicals for some clients.
“Like anyone who wants to stay in business, we are a solutions provider. We will sit with our clients, listen to the problems they have and see if we can provide solutions that kind of fit in our wheelhouse,” said John Ford, the company’s president and majority owner. “So you’ll find that in certain countries, in certain facilities they’re doing something that is not being done anywhere else in the company.”
Ford (pictured above) explained the Greensboro, N.C.-headquartered logistics company can trace its origins to Wrangler Aviation, a cargo airline that Blue Bell, the maker of Wrangler blue jeans, operated to support its factories in Puerto Rico. The planes would carry denim south and finished product north.
Blue Bell then decided to make the airline a common carrier, competing with established cargo airlines such as Flying Tigers and even American Airlines, which at that time was offering freighter service into San Juan.
Ford joined the company right out of college at North Carolina State University in 1982 to be a cargo coordinator and later a salesman for the airline, and he lived for several years in Puerto Rico.
But when Blue Bell was purchased by VF Corporation in 1986, it decided to shed the airline as it was not a core business. (Coincidentally, on Monday VF announced it is planning to spin off its denim companies, which in addition to Wrangler include Lee Jeans and the Rock & Republic brands, into a new company called Kontoor Brands.)
The change in ownership of Wrangler back in 1986 spurred Ford to start his own business, Excel Cargo Services, which was an independent agent for an air freight company owned by Union Pacific Railroad.
He formed his company with the support of a partner in Puerto Rico, Joe Chatt, who had a company called Caribe Express. In 1997 they merged their companies to form CaribEx Worldwide.
Ford said the two firms had complementary locations that allowed them to create a niche forwarder/NVOCC in the Southeastern U.S., Caribbean and Central America. They later added custom house brokerage. It offered both air and ocean freight service to customers moving cargo between the U.S. mainland and Puerto Rico and Central America.
Ford said CaribEx’s business and geographic scope grew as apparel companies in North Carolina opened factories in other locations such as the Dominican Republic and Central America.
“We spread out in order to support them,” he explained.
Last year the company changed its name to CBX Global to reflect its plans to expand into new markets.
While CBX Global’s roots are in apparel, and still account for about 40 percent of its business, the company has expanded into many other vertical niches, including medical devices, pharmaceuticals automotive and aviation and e-commerce.
Ford said the heyday for manufacturing in Puerto Rico was in the late 1970s through the 1990s, when Section 936 of the IRS code provided an incentive for manufacturers not only of apparel but electronics equipment and health care products to locate their factories on the island. After President Clinton signed a law to gradually phase out that incentive, many manufacturers closed plants, and Ford said there was also a drying up of “twin plants” between Puerto Rico and the Dominican Republic.
Despite that, Ford said CBX Global continues to grow in Puerto Rico, where health care products remain a dominant industry.
His company also operates in four Central American countries — Nicaragua, Honduras, Guatemala and El Salvador — where apparel manufacturing is strong.
In addition to logistics, CBX Global offers accessorial services such as warehousing and light manufacturing to its clients. These include services as varied as mixing chemicals used in apparel manufacturing for a customer in Honduras, cutting paper for packaging or labeling products in the Dominican Republic.
Ford said CBX Global maintains warehouses at every one of its offshore locations, and it also has warehouses in Greensboro and Miami. And it is about to open a 65,000-square-foot facility in Charleston, S.C.
While CBX Global has done business in China for 15 years by partnering with agents, Ford said the company decided to open its own offices because it “saw opportunity to go into areas that were difficult to do with an agency-type relationships.”
He explained that a lot of frustration that shippers have when doing business in China grows out of a lack of visibility into their supply chain.
“By having our own offices, that has opened a lot of doors for us,” he explained.
CBX Global Asia Pacific now has offices in Hong Kong, Shenzhen, Shanghai and Chongqing.
In China, its customers ship automotive and aircraft parts, food and a wide variety of consumer goods. And the company handles consolidated “freight all kinds” shipments.
CBX Global’s business in China is “dominated by direct relationships with certain manufacturers,” said Ford.
A privately held company, CBX Global has about 530 employees, moved about 25,000 TEUs in 2018 and is nearing annual revenue of about $100 million.
Apparel logistics remains a growing business and health care is the fastest-growing niche for CBX Global, and Ford said the company is “dipping our toes” into the e-commerce business, doing fulfillment by merchant, picking products and preparing them for shipping and final-mile delivery.
Ford said all of the company’s offices are locally managed, which he feels has been a key to its success, since the managers “understand the culture and the laws and the rules and the way to go about business.”
That approach was successful in Central America, and in China “it is the exact same thing — every employee in China is from China.”
