XPO Logistics

Operations

XPO Logistics operates on a global scale as a third-party provider of end-to-end goods management. Its supply chain operations encompass approximately 1.5% of the $1 trillion transportation and logistics industry, including 63 members of the Fortune 100, making XPO one of the 10 largest providers of these services in the world.

The company’s physical assets include 9,900 53-foot rail containers, another 8,000 chassis for transporting those containers by road, and 19,000 tractors and 47,000 trailers to haul goods. It operates 438 cross-dock facilities to transfer freight from rail to road and back again, and 748 warehouses with more than 150 million square feet of space for e-commerce fulfillment; reverse logistics; omnichannel support; factory and aftermarket support; and integrated manufacturing, packaging, and distribution.

XPO obtained most of its physical assets by acquiring a variety of companies within the supply chain arena. The diversity of their services has been cited as key to the company’s stability when the economy dips, or when factors like inclement weather impact specific modes of transportation, such as rail. XPO makes additional capacity available to its customers through contracts covering 10,000 independently owned and operated trucks; and access to over one million brokered trucks supplied by approximately 50,000 independent carriers.

XPO’s operations are part of the SmartWay Transport Partnership, a program administered by the U.S. Environmental Protection Agency. Under the program, freight shippers, carriers, and logistics companies voluntarily collaborate to improve fuel efficiency and reduce emissions.

Goods management

XPO Logistics provides end-to-end goods management through a variety of supply chain services, including contract logistics, freight brokerage, less-than-truckload transport, full truckload transport, last mile logistics, intermodal (rail) transport, drayage, expedited ground and air shipping, global freight forwarding, and managed transportation.

Contract logistics

XPO is the second-largest global provider of contract logistics, which involves managing the non-transport handling of goods for other companies. Its services include omni-channel and e-commerce fulfillment of orders; warehousing and distribution; the handling of returned goods (reverse logistics); supply chain optimization; and managed transportation. It provides these services in a number of sectors including retail, e-commerce, high tech, aerospace, telecom, food and beverage, healthcare, and agriculture.

Freight brokerage

One of XPO's more prominent services in both North America and Europe is freight brokerage: the act of connecting road carriers with companies that need to ship raw material, parts, or finished goods. As a third-party logistics (3PL) provider, XPO brokers these connections, cutting costs for both shippers and carriers using a custom platform (See § Technology, below.), market intelligence, and carrier rankings based on their load profiles – the amount and types of goods they move.

Less-than-truckload transport

XPO is one of the world’s largest providers of less-than-truckload (LTL) transport, which is the trucking of pallets to different destinations by using a hub-and-spoke distribution system. The company is the largest LTL carrier in Europe and the second-largest in North America. Its network includes more next-day and two-day shipping lanes than any other North American provider.

In combination with XPO’s other asset-heavy businesses, less-than-truckload transport represents approximately one third of the company’s total revenue.

Last mile logistics

Last mile represents one of XPOʼs highest growth areas due to e-commerce, as consumers have been increasingly purchasing heavy goods online. The company facilitates over 12 million deliveries a year, and in 2016 began rolling out last mile services in Europe.

Intermodal and drayage

XPO owns or leases 9,900 53-ft. intermodal boxes and 8,000 chassis to transport them by road. It operates a drayage network of 2,200 independent owner-operators, with access to over 25,000 additional trucks. XPO's intermodal and drayage businesses have run on a custom platform called Rail Optimizer since 2015 (See § Technology, below.).

E-commerce fulfillment

With its acquisition of Norbert Dentressangle, XPO became Europe’s largest provider of e-commerce fulfillment – the processing and distribution of durable goods purchased online. Much of XPO’s high growth has been attributed to its engagement in e-commerce (which also encompasses reverse logistics) and the arranging of in-home (last mile) delivery of bulky items. Retail/e-commerce is the company's largest end market, accounting for 26% of sales.

Technology

XPO Logistics employs approximately 1,600 IT specialists and invested over $400 million in technology in 2016. The company built Freight Optimizer and Rail Optimizer, two cloud-based platforms that use data mining to predict prices and optimize its network; last-mile technology to manage customer experience in real-time; and an expedite bid system to automatically match loads to carriers through a web-based auction portal. XPO has also developed logistics technology – including advanced robotics – for omni-channel distribution, reverse logistics, transportation management, LEAN manufacturing support, aftermarket support, and supply chain optimization.

History

XPO Logistics was founded in May 1989 by Michael Welch and Keith Avery as Express-1 Expedited Solutions, which specialized in time-critical, high-value shipments. The company was purchased in August 2004 by Segmentz, Inc., a transportation firm that traded publicly as NYSE AMEX: SZI. In 2006, Segmentz changed its name to Express-1 Expedited Solutions, which had become its main operating unit, and began trading its stock under the new symbol XPO.

In September 2011, American businessman Bradley Jacobs gained approximately 71 percent ownership in Express-1 when he led an investment of up to $150 million through his firm Jacobs Private Equity LLC, which is XPO's largest stockholder. He assumed the roles of chairman of the board and CEO, announced plans to move the company's headquarters from Michigan to Greenwich, CT, and changed its name to XPO Logistics.

In March 2012, XPO opened a national operations center in Charlotte, N.C. with the help of a job development investment grant awarded by the North Carolina Economic Investment Committee.

On June 14, 2012, XPO Logistics listed its shares on the New York Stock Exchange.

In March 2013, the office of North Carolina Governor Pat McCrory announced that XPO's expansion of its national operations center would bring 287 new jobs to Charlotte within 21 months.

On September 11, 2014, XPO announced an agreement with several investment organizations to channel $700 million into the company for future acquisitions. On June 1, 2015, a larger group of global investors agreed to funnel an additional $1.26 billion of equity into XPO.

In June 2016, XPO Logistics joined the Fortune 500 for the first time. One month later, XPO was named the Fortune 500's fastest-growing company.

XPO was ranked #17 among Forbes’ most innovative growth companies for 2016, and #263 among America’s best employers.

Acquisitions

Since March 2012, XPO has acquired 17 companies through a combination of cash and stock transactions. According to the company, the goal of these acquisitions was to make XPO a one-stop shop for supply chain services across a variety of geographies and customer verticals.

A number of these acquisitions were significant for expanding XPO’s role in various segments of the industry. On the following dates, XPO purchased these companies:

Industry

Customers

Environment

Military