TRUCKIN’ ON INTO 2019 : trucking industry

The trucking industry – that is, short- and long-haul carriers – is a $700 billion dollar business, moving  10.8 billion tons of freight each year.  Ninety-one percent (91%) of these carrier companies have six or fewer trucks in their operation.

Thus, there is a lot of freight to be moved if only the company needing the freight hauling could be easily linked with the small companies doing the hauling.  For a number of years, companies seeking to ship goods have been commiserating with each other about the difficulty of readily finding haulers.  That’s where Drew McElroy is hoping that he can be of assistance.  Since he was 12 years old, McElroy has been involved in trucking, working in a spare bedroom of his parents’ home where they had a small operation that tried to connect truck owners to companies that needed to move goods.  Fifteen years later, after Uber and Lyft had transformed for-hire transportation, McElroy realized that his parents had been involved in what could become the “Uber” of the trucking industry.  The only problem was that McElroy knew the trucking business but didn’t have a clue about starting an online company that used an app and algorithms to provide shippers with better prices and truck owners with better routes and full loads.  While staying with friends in San Francisco, McElroy began to learn how to start a tech company, and, along the way, met his current business partner who had had experience at an online retailer as well as a tech start-up.  Thus, code could be written to support the app that would make the company, Transfix, become a reality.  The company will collect $100 million in shipping charges in 2018, most of which will be passed along to the people who own the vehicles.  Transfix is a 140-person company worth roughly $800 million.  McElroy believes that the company will reach $1 billion in revenue, with double-digit operating margins, by 2021.  They currently help companies like Anheuser-Busch and Unilever with their logistics while also enabling truckers to make more money by limiting the time they travel empty.  Transfix’s real-time tracking, according to a recent Forbes article, allows shippers to better plan loading and unloading schedules and occasionally catch fraud.  After a year spent assuring profitability for the company, McElroy indicates that he will now turn his attention to growth.

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