Freight brokerage is a notoriously crowded segment. According to Silver, the market has somewhere to the tune of 24,000 brokers, all vying for business from large shippers and capacity from carriers.
But there’s power in numbers. Acquiring MoLo makes ArcBest a top-15 U.S. TL broker with access to more than 70,000 carriers. By comparison, C.H. Robinson said it works with 73,000 contract carriers.
The larger carrier base also opens the door to more shippers for MoLo. ArcBest has about 30,000 existing customers, Silver said. Plus, ArcBest has existing assets, which MoLo did not. At times, that proved a hindrance to winning over shippers.
But what MoLo may have lacked in size, scale and assets, it made up for in specialty and quality of service.
MoLo’s focus is on truckload brokerage, which Judy McReynolds, president and CEO of ArcBest, said is the biggest area of logistics spend, on a call with investors in late September. And Silver doubled down on the fact that TL is where MoLo shines.
“I don’t know anything about LTL. I don’t know anything about intermodal. I know about truckload brokerage,” he said on the DAT webinar.
That expertise helped MoLo maintain high service metrics even during a volatile market during the pandemic. According to an email from a Target logistics manager, screenshotted by Silver on LinkedIn, MoLo maintained 97% on-time pickup and 96% on-time delivery, while also accepting more than 98% of loads on primary lanes.
In fact, the retailer named the company 2021 Target Food & Beverage Carrier of the Year. “They’ve been a core customer of ours from nearly the beginning,” Silver wrote on LinkedIn, noting that MoLo started hauling for Target in March 2018, when MoLo was less than a year old with just 25 employees.
Silver said he doesn’t see the acquisition by ArcBest as being bought out or as an “exit.”
“This is an entrance,” Silver said. “I see this as MoLo investing in the future of our collective companies.”
Post time: Oct-14-2021