Welcome to Check Call, our corner of the internet for all things 3PL, freight broker and supply chain. Check Call the podcast comes out every Tuesday at 12:30 p.m. EDT. Catch up on previous episodes here. If this was forwarded to you, sign up for Check Call the newsletter here.
In this edition: How influencers need a 3PL; noncompetes come for the C-suite; and the first installment of double broker red flags.
Influencers and logistics. That’s a combo that works about as well as oil and water. Well, maybe it used to. It turns out social media influencers are a strong marketing tool for companies. The infamous Stanley tumbler is a prime example. A product that once was at the end of its life span was single-handedly thrust into the limelight through influencers and affiliate links and now has people all over the internet stalking restocks anywhere they can get their hands on them.
For most brands, influencers can generate $6.50 for every $1 spent in advertising, according to Convince and Convert. Naturally influencers want to capitalize on that for themselves. When creating content full time as a solo act, the last thing a one-man band wants to do is fill orders for merch. Enter the 3PL. Snapl has found a niche by doing just that. The creator sends all inventory and merchandise to Snapl and it takes care of the rest, from packing to inventory to shipping. E-commerce is more than just packages from Target, Walmart and Amazon. With e-commerce not dying down any time soon and the rise in PR boxes, and influencer merch. Good e-commerce 3PLs will need to have a good handle on how to navigate.
Noncompetes have reared their ugly head again. Noncompete agreements affect more than 30 million people in the U.S.,according to the Federal Trade Commission. As we know, earlier this year the FTC proposed a rule to ban noncompetes in an effort to give people back the freedom they should have to move out of a toxic workplace or simply just seek out new opportunities. According to “All Things Considered,” the signing of a noncompete can pass unnoticed in the pile of first-day employment paperwork.
This time the fight has hit upper management. Marvin Cunningham, former COO of GXO, was sued by GXO for violating the terms of his noncompete. Cunningham left GXO to work for Prologis. GXO claimed that Cunningham breached his noncompete as he allegedly provided competitive services before his noncompete expired. After heading up to federal courts it was ruled that the noncompete was not enforceable in this specific case.
TRAC Tuesday. This week’s TRAC lane of the week is from Charleston, South Carolina, to Indianapolis. Spot rates on this lane have increased about 10 cents per mile since the beginning of the month — a small increase but one likely appreciated by carriers. Capacity hasn’t changed significantly week over week in either market but something to note is that outbound tender rejections are at 6% in Charleston compared to the 2.5% in Indianapolis. Watch the Charleston OTRI for a dip as that will bring the spot rate down with it.
Who’s with whom? XB Fulfillment is pedal to the metal on growth in Mexico. The San Diego-based 3PL focusing on e-commerce and omnichannel brands with bespoke fulfillment, which is basically just custom-packed kits that focus on brand presentation based on consumer preferences, has received $100 million of private equity from Los Angeles-based Caprice Capital Partners LLC. This investment is the second from Caprice, after a previous round of funding in 2021.
With the influx of cash, XB is looking to expand operations into Mexico as there is significant duty savings, low labor costs and a strong talent pool. According to Rich Thomson, founder of Caprice, “The Company has nearly tripled in size from our initial growth capital investment in January 2021 and we’re excited about the Company’s next stage of growth as it expands its capacity by approximately 60% and broadens its geographical presence.”
Double broker red flags. In a new section of the newsletter, it’s double broker red flag corner, where tips and tricks to avoid getting played by a double broker will reside.
Double broker red flag No.1: Zelle only for payment method. Courtesy of Rebecca Tisbe.
I love a good bank-to-bank transfer. It’s great for paying friends back for dinner, a hotel reservation, etc. However, I don’t think that is the best way of doing business. If your carrier can only accept Zelle, maybe dig a little deeper as to why and double check that authority and insurance.
Got any tips that are your favorite? Let me know or share with everyone on LinkedIn. I’d love to share them with everyone.
The more you know
It’s time for massive load board players to take responsibility for fraud
Lawmakers look to bolster ranks of young truck-driver program
TuSimple cuts 300 more US jobs, will keep China operations
Shein invests $70M toward upgrading its supply chain
Turvo and Denim partnership aims to simplify freight payments
See you on the internet,
Mary O’Connell
@MaryO_119