Huntington Beach, California is where you will find the head offices of Freightsaver. The company acts as a freight brokerage, the middleman between the shipper and carrier. Therefore, it owns no equipment to move shipments but instead manages the logistics behind that goal, going that extra mile and doing things that larger entities avoid. Cloud-based technology has greatly added to its abilities, and despite multiple challenges, Freightsaver is growing. We spoke to its Executive Vice President of Sales Jay Hughitt.
Freightsaver was founded in 2014 by Buster Schwab and Ryan Renne who had been working together in this field for over 25 years. Previously, both worked for a small, privately-held brokerage in the Los Angeles area. They helped to build that business up to a worth of $25 million and decided to start a company called Mountain Logistics in 2000.
“They grew that business from 2000 to 2007 to a little over $18 million and then sold it to a company called Echo Global. They were Echo’s very first acquisition before it became a publicly traded entity. I met them and went to work with Buster and Ryan in November of 2009,” says Jay.
Together, the group expanded operations to become the largest division within Echo. By 2014, both Buster and Ryan were ready to leave and start another brokerage. In August of that year, Freightsaver was launched by Buster and Ryan.
The company was self-funded, and this year it will have grown to about $19 million, with twenty-five direct employees. The company’s focus is on small to medium-sized shippers and the service side of the industry.
“We don’t own any trucks, planes, or trains. The only things we own are computers and phones. This forces us to be good at communicating with customers, being proactive, and servicing them. That’s how you earn your money in this space. If you were to ask us individually, that is what you would hear from each of us. When things aren’t going well… that’s where you earn your money,” he says.
“The business we go after is hard business, and this is a fractured industry and very disjointed,” says Jay. The field has many carriers and an abundance of regulations to be navigated. Indeed, the industry is perhaps more complex than most people would imagine, but this is exactly where Freightsaver comes in. The company was founded to bring a different approach to shipping, one that prioritizes meeting customer needs and making sense of the various complexities. As the company’s website says, Freightsaver is “a calm voice in a chaotic world.”
To this end, the company works with small to medium size carriers that also focus on the service side of the business. “Everything has become so commoditized in this industry,” shares Jay. But Freightsaver has elected to go a different way. As he says, “We have to find business that is service first, service second, and service third.”
For example, Freightsaver must be the one that communicates with customers when things go wrong. Understandably, this happens a lot in the freight business; the difference is that typically, the receivers are responsible for any information needed. Freightsaver chooses, however, to take on that responsibility.
“We are not hiding behind a desk e-mailing people to let them know a shipment will be late. We will pick up the phone and let them know what the issue is. We work with the customer because that’s how you build a relationship. We don’t hide behind technology. We get out in front of the problems,” says Jay.
One of the unique ways in which Freightsaver caters to its clients is in its efforts to simply answer the phones, whether it is a Monday afternoon or 8 PM on a Saturday. The company also performs many weekend pick-ups and deliveries for its clients. For one of its largest clients, the company will do ‘next flight out’ business every day.
It is an approach that has served the team well; the company has been successful through expedited services, special needs services, debris removal, and even furniture assembly. Soon, it will be undertaking a big hotel project; a provider has been sourced, and forty-eight bedrooms’ worth of furnishings will be delivered to the hotel. Freightsaver will also arrange the necessary items for two restaurants, a rooftop bar area, and the pool. This is business the company would not have sought out five years ago at Echo.
Freightsaver recently completed a project where it picked up five pallets at a warehouse, delivered them to a resident, and performed a complete unpack. Although it is not a moving company, it will do that for customers from time to time. The job involved debris removal, assembling two tables, and hanging a bookshelf on a wall. This is business that it is finding more and more.
“It is what will drive our business moving forward – airfreight, international/domestic. We do [less-than-truckload] to truck and the whole nine yards, but we are trying to move the business forward with our FreightNow group, which is all specialized expedited services, hands-on, white glove,” says Jay.
“We also do a lot of event-driven freight, so there are job crews waiting onsite for [just-in-time]. We are always available, whether it’s by phone, text, or e-mail,” says Jay.
Finding qualified help is the primary challenge for Freightsaver, something being experienced industry-wide, and being a small company does not necessarily help in that process. The second challenge is developing customer loyalty since customers do not really see what the company does. “A lot of customers are loyal until something goes sideways, a lot of them move on. There are a lot of price shoppers in this business,” says Jay.
FreightSaver looks for customers who will benefit from the strong service side of the business, like those shipping high-end products. This customer needs more communication and tracking abilities of the cargo during transit, aspects at which Freightsaver excvels. These customers are, however, harder to find.
“The focus is ongoing for specialized business,” Jay explains. “It’s a longer sell and lead-out time to find because typically customers in that space have a few providers that they use, and there is a trust factor in place. You have to be at the right place at the right time and hope that one of those providers goes south on something and the customer is willing to entertain other options,” says Jay.
To service its clients, Freightsaver is planning to open additional offices nationally and will increase its inside sales team to work on specific avenues for the company. The FreightNow team is gearing up, and the company has operators that can handle specifically dedicated FreightNow shipments.
FreightNow is not a system, but rather a group that handles any shipment that is not less-than-truckload (LTL) or traditional truckload. The focus is to find clients looking for these types of services. Trade show shipments are a good example of this.
Freightsaver uses cloud-based technology, and its transportation management system (TMS) is a web-based platform that can be accessed from a tablet, cell phone, desktop or laptop. The company is making some changes to the TMS that will designate specifically what shipments are, so it knows which are specialized. Whether it is a small parcel or an air shipment, the company can track the growth to revenue and margin growth of that division.
Freightsaver has been successful to this point because of the leadership of Buster and Ryan and their stewardship. Being the middleman as a freight brokerage is not an easy endeavor, but Buster and Ryan have over thirty years of experience. They know how to use that industry experience to get better service than customers can get for themselves.
“The customer can’t find capacity, but we can. We match the right carrier to the right load, and there is a lot of business we turn down. We don’t chase commoditized business. Our niche is to try and find the needle in the haystack, grow the business, and move it forward,” says Jay.