The third party logistics industry had double digit growth in every sector last year, according to a survey by Armstrong & Associates, Inc. Overall, usage increased by 16.5%. Non-asset-based domestic transportation management grew by 18% while international business was up over 10%.

    Richard Armstrong, president of the Wisconsin firm, anticipates growth of 15 to 20% this year. He noted that small to mid-size companies, the mainstay of clients of business INSIDER readers, are the right size to have their integrated supply chain managed by a single, contract logistics company. Armstrong predicted the strong growth pattern for at least the next three or four years. He includes transportation for E-commerce in his prediction of growth.

    Industry World Growing Companies   magazine reviewed the services offered by third party logistics firms and said, "This is the way to cut costs!" Here's their actual quote, from an article written by Lisa Harrington.

    "Looking to cut inbound and outbound freight transportation costs by thousands of dollars per year? Consider contracting with a third party to manage dedicated truck fleet and core carrier operations. Third-party logistics (3PL) providers generate savings, in part, by combining a manufacturer's shipments with those of other customers to maximize mileage and load efficiencies on common shipping lanes. On its own, the small manufacturer could not have tapped into such synergies."

    Harrington reported that "Outsourcing can and does produce significant bottom-line gains - in both cost savings and revenue enhancement."

    Forty-one percent of respondents to a University of Maryland Graduate School of Management and Technology study cited savings as the reason they outsource. The same study concluded that the more activities a company is willing to outsource, the bigger the savings.

    The IWGC article continued, "Logistics outsourcing often makes terrific sense for growing companies. Why spend precious resources on activities that aren't your core business? . . . To improve customer service, contracting out functions that cut delivery times and improve delivery accuracy to external customers work best."

    Harrington reported, "Some 3PLs even have begun targeting medium-sized growing companies as new service niches. This trend is likely to mushroom as the large?company market for 3PL services nears saturation. That's good news for growing companies that may have had trouble getting 3PL providers' attention."

    As entrepreneurs, transportation service providers must use change as a standard business discipline. Speaking of entrepreneurial disciplines, business leader Peter Drucker says, "Every institution . . . must build into its day-to-day management four entrepreneurial activities that run in parallel." There must be systematic attention to:

1. Abandonment of products, services, processes, markets, distribution channels that are no longer an optimal allocation of resources
2. Continuous improvement
3. Continuous exploitation, especially of its successes
4. Innovation to make today's successes obsolete

    The concept is to build a different tomorrow on a proven today. Even the most successful concepts used now must be replaced by innovation for the future.

    Are you e-In or e-Out? That question should soon replace the ice-breaking astrological question, "What's your sign?" The inquiry asks if your company does e-commerce or is involved in e-business. If you want to stay profitable in the transportation business, your answer needs to be, "Yes!"

    Freight brokers and transportation intermediaries are now deep into consideration of what their electronic strategies should be. There are pros and cons to being at the front of the curve. And they all involve money!

    Whether to become a trading partner on the Internet is no longer the question. It's simply a matter of when, how and with how much emphasis. Internet investment is taking on a whole new spin for transportation intermediaries.

Benefits of Jumping in Early	Benefits of Waiting A While
Name recognition, connected with e-business	Software costs will come down
Early start on building credibility	Early bugs will be worked out
Opportunity to become proficient, before the stakes escalate	You can benefit from the lessons learned by the pioneers
Builds reputation as innovator and market maker	-
Downsides of Not Waiting	Downsides of Waiting
Higher cost for software	You may never catch up.
Software may not be powerful enough	Your best prospects may already be committed to others.
Within 6-12 months, there could be cheaper software that does a better job.	You may disappoint customers or clients who hoped you could handle their e-business.

    Online tracking has already become a popular request of shippers. According to at least one industry survey, it is the report most frequently requested by clients and customers of transportation intermediaries. Since FedEx and UPS led the way to customer-empowered tracking, the software is assumed to be easily accessible, affordable and high on the list of "the least you could do for us."

What's in a Name?
Evolution of the Transportation Broker

Emergency Management-
Have your "What if" scenario in place?
You'll need it, if lightning strikes, as it did with this logistics management firm.

THOUGHT LEADERS SPEAK OUT
Recruiting and Retaining Qualified Employees

When Dispatchers Can't Type
Adult Learning - Fast and Effective - on the Internet

For Transportation Intermediaries
The Carrier Who Won't Work for Anyone Else!

3PLs - Short on Selling Innovation

E-Commerce/E-Business
Strategies for Freight Brokers

Drowning in data?
Turning Information into Knowledge

Delivering What You Promise

Hot New HR Benefit - Employee Assistance

Trust - Between Carriers and Brokers
What Does It Look Like?
What Does It Feel Like?
Where Can You Buy It?

Database Management
Your New Field of Interest

Lifestyle
How to Enjoy - While Watching the Store

Reassessing the Image of Brokerage
Through the Eyes of Youth

Publisher and Editor
Annette E. Petrick
540-459-8390
Fax - 540-459-3440
anetrick@shentel.net

Website Design - Aaron Collegeman
Print Graphic Design - Deborah Ranson
Editing - Kathryn Rosypal

Published by
Petrick Outsourcing Unlimited, Inc.
Management and Marketing Consultants
to North America's Transportation Companies
679 Hottel Road
Woodstock, VA 22664
www.transportmarketing.com

Subscriptions/billing
Sandi Thomasson
540-459-4048
Fax - 540-459-8775
sthomass@shentel.net

Advertising
Lea Frazier
540-459-4048
Fax 540-465-9487
lafraz@shentel.net

Why business INSIDER?

    Billions of dollars worth of freight now flow through the hands of transportation intermediaries. You make markets, cut costs for shippers and generally contribute to the health and welfare of the trucking industry and other modes of transportation.

    Such growth and success naturally led to the creation of a trade publication to report and view your unique business. That's what business INSIDER is all about. We'll cover the mature, sophisticated, service-centered business you have become. You'll read about the trends and issues of interest to transportation intermediaries. You will meet those who provide services for small and mid-size companies, as well as the giant 3PLs and their Fortune 500 clients.

Annette E. Petrick, Editor and Publisher

    A new Internet-based Document Management System has been designed specifically to manage shipping documents and POD verification. The new customer service tool is receiving an enthusiastic response from shippers, truckers and transportation intermediaries.

    UniversalPOD™ was developed by prominent electronic document management systems specialist, Bader Technologies. The system is being hailed as a breakthrough for companies that need to manage large amounts of documents. It's a legitimate alternative for firms that seek to avoid the cost of establishing custom-designed in-house systems.

    The Internet-based document management/POD verification system is presently being used by The Home Depot and Mill's Pride, one of its major suppliers. Several trucking firms that deliver Mill's Pride shipments to individual Home Depot retail outlets across the nation are also using the system.

    Mill's Pride, which ships 300 to 400 truckloads weekly, has essentially eliminated the costly and time-consuming problem of lost paperwork by using the UniversalPOD™ system.. Similarly, trucking firms using the system have reported increased speed and total accuracy in retrieving PODs. This accelerates their billing and payment cycles.

    PDQ Transit sometimes works with up to seven PODs per trip. They make multiple delivery stops at Home Depot outlets. They've noted that the UniversalPOD™ system has cut down on paperwork, phone calls and searches for lost documents.

    Transportation intermediaries need particularly comprehensive document management. Besides PODs, this new system can be used for rate agreements, freight bills, manifests, invoices, bills of lading and customs documents.

    The UniversalPOD™ system is designed for ease-of-use and economy. For companies with existing websites, a link is established to www.universalpod.com and documents can be scanned in. They are immediately organized for easy retrieval. Access is password-protected. The password can be provided by subscribers as well as approved designees, such as originators or recipients of shipments.

    For companies that do not have a website, Bader Technologies will establish a Home Page and provide hosting services free of charge. Through this unique service, even very small firms can impress and reassure their customers by utilizing the Internet to provide efficient service.

    Subscriber costs for the UniversalPOD™ system are based on volume. For about $500 a month, 1-10 users can initiate up to 2,500 transactions. This makes the system affordable to virtually any intermediary and small to medium-sized trucker or third-party logistics company. Complete customer service, secure Internet sites and software upgrades are included in the base monthly fee. Hardware requirements are standard office equipment - commercial-quality scanner and standard PC with a connection to the Internet.

Honored Business Woman, Philanthropist
TIA National Member of the Year
Karen A. Pelle
President
Megatrux, Inc.
Brea, CA
www.megatrux.com

    When she started in business in 1985, Karen Pelle was determined to do things differently. Her personal style of charm and grace seemed at odds with the rough and tumble business of freight transport. Holding true to her values and her dreams, Karen has grown her company from a fledgling operation to a nationally recognized firm in the top 15% of transportation intermediaries.

TEAM BUILDER

    Karen has created an organization that truly operates as a team. They do so, not because it's the business process de jour, but because it's part of the value system that IS Megatrux. Karen's training and example instill pride in her colleagues for integrity and consistent, high quality service.

MENTOR

    During the course of her success, Karen has taken the time to nurture and guide. Her reputation for mentoring and inspiring is well known in the industry. The result has been a cadre of long term professional employees who know exactly how to get it done, who do their work with panache, always adding the little extra that sets Megatrux apart.

WOMAN-OWNED BUSINESS HONORS

    As head of a woman-owned company, Karen is also a symbol of the heights that women can achieve. Hers is one of the top 500 woman-owned businesses nationwide, and the top 100 woman-owned business in Orange County, CA. As such, she has been featured in a success story on "Women in Transportation" in Transportation Intermediary magazine and profiled in a special millennium issue of the Orange County Business Journal.

TIA MEMBER OF THE YEAR

    In 1997, Karen was honored by the industry when she was selected the national Member of the Year by the Transportation Intermediaries Association (TIA). Her bright smile is seen on the speaker's platform, in the press and as a panelist on industry subjects.

DRIVER ADVOCATE

    Karen constantly expresses gratitude to the drivers who are so pivotal to success in transportation services. It is company policy to treat drivers well and to act as their advocate with customers where appropriate. It is said that "drivers can't wait to move for Megatrux." It's where they know they are appreciated and loved. Gratitude for a job well done is shown with bonuses, gifts and premiums that remind them that Megatrux cares. Perhaps even more important in this hurry and hustle world, they know that at Megatrux, they'll find a smile, a kind word, some humor and lots of personal attention.

THE ART OF GIVING

    As her company has grown, Karen has been generous in sharing profits with employees and with others. Her annual holiday gift to customers and vendors is a significant contribution to the City of Hope National Medical Center and Beckman Research Institute, supporting patient care and innovative research programs to combat life threatening illnesses. Other charitable causes supported by Megatrux include Children's Hospital of Orange County, Make-A-Wish Foundation of Orange County, St Jude's Memorial Foundation, Eli Home for Abused Mothers and Children, The Geoffrey Lance Foundation for Spinal Cord Injury, The Herring Foundation, Southbay Hands on Art, the Muscular Dystrophy Association and Times in Education, where Brea O'Linda High School is the selected benefactor of the contributions.

In 1998, Megatrux commissioned this gift-giving logo which incorporates the firm's heartfelt creed: Hope, Desire, Courage and Trust.

BEST BROKER

    For the last four years consecutively, Megatrux has been selected by the National Association of Small Trucking Companies as one of their Best Brokers - a distinction earned by only 1% of all transportation brokers. This selection is another indication of the contribution made to the industry by Karen Pelle and Megatrux through its involvement, professionalism and work.

MEGASERVICE

    The Megatrux business philosophy contains the essence of the company. Karen Pelle says, "Megaservice means never being out there alone. It means having someone watching out for you, considering every contingency, every possibility. . . We've earned our stripes as transportation professionals. We do it with style, grace and a smile. It's more than just business. We enjoy it - and it shows."

business INSIDER Advisory Board

   When Karen heard that a new, independent publication was planned for transportation service providers, she was one of the first to provide support and backing to turn it into reality.

   "This is something that has been missing," said Karen, "It will be an oppor- tunity to shine the spotlight on businesses that have earned the limelight. There are hundreds of firms providing the intricate services that connect shippers with the carriage that delivers their goods to market. They deserve to be served and recognized as an integral part of the freight transport business."

OUTSIDE OF THE OFFICE

    Outside the transportation and logistics world, Karen is dedicated to her sons, Chuck and K. C., and her extended Megatrux "family." An example of her dedication to her team was the week-long "surprise" Hawaiian luau celebration she recently provided for the whole staff - not for a special occasion or accomplishment, but just because they consistently perform so well.

PASSIONATE FISHER

    One of her secret passions is a love of fishing - any kind of fishing. She was particularly proud of the 46 pound, 44.5 inch King Salmon caught off Port Charlotte Islands in Vancouver British Columbia. He's mounted and hangs in the Megatrux office. Associates joke that he's big enough to deserve his own office.

    The Carmack Amendment governs the liability of motor carriers for goods lost or damaged during transportation. It provides that a motor carrier is liable "for the actual loss or injury to the property" incurred during transportation.

    However, there is an exception to this rule under which the motor carrier may establish rates for the transportation of property under which the liability of the carrier for such property "is limited to a value established by written or electronic declaration of the shipper or by written agreement between the carrier and shipper if that value would be reasonable under the circumstances surrounding the transportation". In order to effectively limit its liability, a motor carrier must maintain a valid tariff (or if the motor carrier is not required to file its tariff, it must provide the shipper upon request a written or electronic copy of the rate, classification, rules, and practices upon which the rate is based) and must provide the shipper with a choice of liability coverage.

    In a recent case decided by a federal court in Illinois, the factual situation was that the motor carrier never expressly informed the shipper that it was paying a lower freight rate in exchange for the motor carrier's limited liability or that the shipper could pay more for full liability. However, the bill of lading, which was prepared by the shipper, incorporated the motor carrier's unfiled tariff, which contained those limitation provisions.

    The court grappled with whether the law requires a bill of lading provision offering different rates for different carrier liability. The court concluded that a tariff provision is enough when you're dealing with a sophisticated shipper who should know to request the tariff. The statute provides that where the motor carrier is not required to file a tariff, it shall on the request of the shipper provide it with "the rate, classification, rules, and practices upon which any rate applicable to a shipment, or agreed to between the shipper and the carrier, is based". Under these circumstances, the court determined that the shipper had been given a fair chance to opt for full liability.

    The federal court in Illinois came to a different conclusion than some other courts involving this issue of whether the statute requires a bill of lading provision offering different rates for different carrier liability. Also, the holding in this case appears to have been based on the fact that the motor carrier was dealing with a sophisticated shipper. A different court confronted with this issue could arrive at a different conclusion.

This article is not meant to provide legal advice or offer solutions to individual problems. Specific cases should be discussed with an attorney. The opinions stated in this column are strictly those of the author, and do not represent an official position of the publisher.

William Gray, a transportation attorney, is a partner in the Law Firm of Vuono & Gray, LLC in Pittsburgh, PA. (412) 471-1800

    Mile.com has already had its one millionth hit. Since its launch last April, the transportation portal site has averaged 8,000 hits each day with users from eleven countries around the world.

    Mile.com was created to aid the trucking industry. Helping companies and owner-operators avoid deadhead miles, the new site offers direct access to the 20 best online load matching services for quick searching or posting. To keep visitors up-to-date, the site links to industry trade publications - Transport Topics, Heavy Duty Trucking, Road King, Overdrive, Fleet Owner, Transportation Technology Today, Transportation & Distribution and others.

    There are real-time updates on road conditions, weather, diesel prices, trucking company stock quotes, computer software and Internet services. The site also maintains an active database of job postings, linking quality drivers with companies that are actively recruiting.

    Avoiding slow-loading graphics, the site organizes services, information, and links into an easy-to-use, comprehensive directory with customization for drivers, dispatchers, MIS personnel, and owner-operators.

    Prophesy Transportation Software is the sponsor of the site, responsible for its content and power. According to Prophesy CEO Edward J. Forman, future development plans for the website include free e-mail accounts, bulletin boards, and web design and hosting. Companies will be able to search for drivers based on criteria such as pay, experience, maximum desired trip length, or driving history.

    Few commodities are more fragile than fruits and vegetables. Incorrect handling accounts for huge shortages and losses each year. You have to be sure that drivers and handlers know how to do it right.

    L&M Transportation Services, Inc. in Raleigh, North Carolina, has been doing it right for more than two decades. President Boe Davis uses the following checklist with drivers, to be sure everyone is on the same page about what needs to be done.

You are welcome to adopt the checklist for your own company's use, if you are in the produce business. If not, you might use the list as a guide in how to eliminate shortages and damages in the products you do handle.

1. Pulp products at loading - Report any temperatures over 40 degrees.

2. Count product at loading! Know the tie/high and the number of pallets loaded.

3. Check condition of boxes - Report trouble!

4. Secure load with load locks! If boxes stacked straight up (not tied), turn pallets.

5. Check bills - have any quantity changes initialed and note who made the change (shipper/receiver).

6. Make sure shipper changes his copy also.

7. Have temperature (to be maintained) on bills.

8. Must have Temperature Recorder on all CA and AZ loads.

9. Who is responsible for pallet charge (shipper, receiver or truck)?

10. Visually check load daily for leaning pallets, damaged boxes, etc.

11. Regularly check refrigeration thermostat and trailer temperatures.

12. Have pulp thermometer in rear of trailer, and check 2+ times a day.

13. Count product at unloading.

14. Check bills thoroughly for all signatures and quantity changes.

* If two or more receivers are signing for product on the same bill, make sure every box is accounted for.*

    Imagine how much volume a broker could do if dispatchers didn't have to be on the phone all day, looking for trucks. Now there is a service that can match a load with a truck automatically, without human intervention. It's like having an automated dispatcher.

Called Instant Notification, this breakthrough technology was developed in the Research and Development laboratory of The Internet Truckstop (www.truckstop.com) as the third generation upgrade to Truckstop's original load matching service. Information on loads and trucks appears on the monitor within 2.5 minutes of being posted. When the computer sees a suitable link of load to truck, it matches the two. The dispatcher takes it from there, eliminating the whole process of "hunt and hope."

    "Instant Notification" is now the new standard for freight matching, available exclusively on The Internet Truckstop.

    "Firms seeking strong growth are achieving dramatic results from using this new tool," stated Scott Moscrip, President of The Internet Truckstop, "Load matching is now being played by new rules. Transportation intermediaries want the freshest truck availability information possible, with the easiest access. Before this, it was just a wild wish. Now it exists."

    Fax notification, once a breakthrough in freight matching, was replaced with faster e-mail notification as the next evolution. Instant and automatic matching is the next step in the evolution of connectivity for the transportation industry.

    Moscrip called the new service "a quantum leap forward" that eliminates dozens, if not hundreds, of calls daily for a third party operation.

    With over 17,500 sign-ons, and more than 300,000 power units, The Internet Truckstop is the largest Internet-based load matching service. Instant Notification is the latest in a series of upgrades to constantly respond to the needs of transportation intermediaries and drive operational costs down.

    Brokers can post loads at no cost at all. To have the capacity to search, the monthly fee is just $25, with no individual transaction fee. That account now includes Hot Prospects, an expedited truck searching tool and Instant Notification, the ultimate, automated truck finding tool.

    "With the demand in the marketplace today, brokers and other intermediaries have seen money left on the table because they cannot find trucks for all the freight they could book," Moscrip noted. "Instant Notification can change all that. Volume increases as the need to make calls decreases. Trucks present themselves, right there on the screen, with equipment and availability automatically matched to the freight."

    One firm, initially skeptical about the new tool, wound up buying two additional computers, so two monitors could run all day, automatically matching freight with equipment.

    Instant Notification requires virtually no start-up or learning time. It can be integrated into a third party operation instantly. Anyone even slightly familiar with Internet access through a computer can set it up in a matter of minutes.

    Other essential Broker Tools in The Internet Truckstop technology portfolio include instant insurance verification, which eliminates the slow faxing of requests and documentation back and forth. Broker credit information is available to carriers instantly from Trans Credit, through a companion service for truckers, on The Internet Truckstop.

    "We've made a lot of gains in less than five years since The Internet Truckstop was introduced to the transportation industry," stated Moscrip, "But none has had the revolutionary impact of this third generation upgrade. Instant Notification is a pivotal key to prosperity and growth for third parties in the new transportation marketplace."

Details: www.truckstop.com
e-mail - support@truckstop.com
or call 800-203-2540.

NGL Goes Global
    Next Generation Logistics has formed Next Generation Global Logistics, to address worldwide delivery of freight. Currently celebrating its eleventh anniversary, NGL has developed from a regional logistics firm into a company that provides full service logistics management consulting, outsourced contract logistics, international freight forwarding, customs house brokering, and NVOCC. Ari Smith is president of the firm, based in Inverness, a suburb of Chicago.

Flynn Moves to Double Sized Quarters
    Flynn Transportation Services has moved to new, larger quarters in Florida, where the brokerage has been located for the past ten years. The new address is 100 N.E. 5th Avenue, Suite B1 in Delray Beach. President Chip Flynn reports that the new digs contain space for ten in the operations area plus executive offices and conference room.

ABC - Huge Broker - Purchased by CHRW
    American Backhaulers of Chicago, one of the country's largest broker operations, has been purchased by its biggest competition, C.H. Robinson Worldwide. Robinson is the largest broker in the United States and a major non-asset-based service provider.

    ABH President Paul Loeb, founder of the company, continues to head the business, which now operates as a division of C.H. Robinson. Rob Pierson, a CHR VP, has joined ABH to assist with the integration of the two firms.

Curtis Brokerage Bought Up
    After more than 40 years, the owner of Curtis Trucking in Fredericksburg, VA, has sold his operation. Purchaser is insurance executive Mark Cisk, who now owns Curtis Trucking, Curtis Brokerage, Allstate Trucking and Allstate Brokerage. All four businesses will be operated separately, under a "family of companies" umbrella. C. C. Curtis remains with the company, returning to the operations area.

Canadian 3PL into Rail
    Clarke, Inc. is expanding its third party logistics management service by acquiring an 80% share in Transci Transportation Systems, a subsidiary of Canadian National Railways. Senior Vice President Doug Pane said Clark has contracts with all major North American railways. Some 95% of the business of the Toronto based firm is shipping across Canada, the United States and Mexico.