Q&A: Ross Spanier, Senior Vice President of Solutions at GlobalTranz

Logistics Management Group News Editor Jeff Berman recently caught up with Ross Spanier, Senior Vice President of Solutions at GlobalTranz, a Scottsdale, Ariz.-based full-service 3PL focused on freight brokerage and technology services provider. In a wide-ranging conversation, Berman and Spanier discussed the ongoing impact of the coronavirus pandemic on supply chains, as well as capacity conditions, rates, and intermodal, among others. A transcript of their conversation follwos below.  

Logistics Management (LM): What are your shipper customers telling you their biggest concerns are, as they relate to supply chain, freight transportation and logistics concerns?

Ross Spanier: First and foremost, they want to know we are there to support them. They are very curious and concerned about how their essential products can be continued to be moved and keep life in order. We are spending a ton of time educating shippers about what is happening in the marketplace and it is not just necessarily pertaining to how we are providing operational continuity but how are carriers, whom are essentially the lifeline of our business, are able to transport goods in a safe way. I think GlobalTranz has been built for situations like this, having a platform of technology and people that is able to be agile and adapt to crisis mode, where we can work form home and operate and do business just as if we were in the office. We are working tirelessly with our shipper and carrier communities to make sure goods are being moved and are not disrupting supply chains. People have food to eat, and stores are stocked. Essential goods are being moved across America.

LM: What is your take on how certain pockets of the U.S are bearing the brunt of coronavirus, as it relates to the movement of goods, compared to other pockets of the U.S.?

Spanier: There were lots of disruptions on routing guides, when Pennsylvania shut down rest stops, which have since re-opened, as carriers did not want to go there. In California, there has been disruption, as there have not been a lot of goods coming out of the containers arriving into ports there from China. That has created a lot of concern with carriers not wanting to go there and rates increasing significantly because of that. And there are also a growing number of states with more strict quarantine guidance from government mandates, too. Drivers are aware of those situations, and we are working to make sure we are supporting our drivers and customers alike.

LM: With containers short in supply and at a premium, how is that being handled, or addressed, by companies like GlobalTranz?

Spanier: What we have had to do is move most stuff over the road across the country, where it has typically moved via container. While that speeds up transit time, it also significantly increases costs for shippers, and we are mindful of that as well.

LM: There is a flurry of rapid fulfillment occurring, due to coronavirus, for many essential items like toilet paper, paper towels, and many others. But, at the same time, people are still going to stores in need of essential items and seeing empty shelves. That said, how do you see the balance between just-in-time inventory management and things getting bogged down to get ahead of stock outs and related things?

Spanier: We are seeing a ton of inventory get depleted that has been trying to get built up for different seasons. For example, during the summer months, there is a heavy distribution of beverages, specifically water. That is being depleted already, because it is needed now. Manufacturing is on full-go right now, and we are also distributing inventory that was going to be built up for those [typically seasonal] times. We have carriers that were committed to a set amount of loads on a weekly basis for regular runs, and our customers are saying they need 30%-to-50% more volume from your carriers in order to do that. We are working with our carriers to see what they can handle and are going out and working with our other dedicated carriers to let them know where we need help. That has been our approach there, and we have great technology that helps us understand where our carriers are in the marketplace and where they are looking to go, and we are matching that up in times like this.  

LM: As a follow-up, how would your characterize what the over all capacity situation was, say, four or five weeks ago, before things relating to the coronavirus took hold, compared to early last week?

Spanier: We are certainly seeing spot load postings go up, which tells us there is more freight hitting the market, with loads heading up in the 30% range compared to a week ago. Rates in contractual lanes have seen increases, and this is due to capacity leaving the market, as carriers choose to take higher-paying spot rates or park their trucks, due to the coronavirus crisis. We have not seen anything that has given us pause or a lot of concern in terms of our ability to fulfill our customers’ needs, but we are seeing capacity take a sharp turn.

LM: Dedicated and private fleet carriers are focused on more committed capacity engagements, to be sure. Do you think that depending on how long this pandemic persists that there will be a decrease, or lessening, of dedicate and private fleet players, with more flow into the spot market? Or will there be sustained committed capacity arrangements remaining in place or is it too hard to tell?

Spanier: I think the committed capacity is there, and the carriers that we are seeing and having conversations with….are seeing more volume in the marketplace, which has to be handled outside of the committed capacity (in the form of spot arrangements).

LM: With declining West Coast port volumes impacting intermodal, how do things stand on that front, in terms of how you address that with your intermodal shipper customers?

Spanier: There is a lack of 40-foot containers, due to the lack of imports, which is the most cost-effective way to ship intermodal for customers so there is certainly an issue there. In general, though, rail and dray capacity is pretty plentiful across the U.S. at this time. There has really been a drop in intermodal volumes because of the lack of imports out of Southern California.