Do Mega Carriers make money off of their warehouses

Discussion in 'Motor Carrier Questions - The Inside Scoop' started by Newtrucker123579, Feb 11, 2023.

  1. peabody747

    peabody747 Light Load Member

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    it really depends on the companies and what they using the space for.
    For instance had one company he would over book on contract freight then have local drivers bring it to warehouse to store till road drivers could get, or some use just to have space to restack loads before delivery. Then some just bought the warehouse space to be there main terminal.
     
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  3. Newtrucker123579

    Newtrucker123579 Light Load Member

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    Do final mile deliveries include OTR sorry I’m very confused on this?
     
  4. Knightcrawler

    Knightcrawler Road Train Member

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    Usually, but not always. "Final mile" is the company that actually made the delivery. In the case of Old Dominion for example if they had a cartage company deliver (say in Chicago in an area of low bridges where their own trucks cant get for example) it instead of them then the cartage company would pick it up from ODs terminal and deliver. But lets say it was a truckload and they brokered it out to JB Hunt. Then JB would pick it up from the shipper and deliver it, running the OTR miles. Or obviously if they picked up and delivered then they would be the "final mile" company.

    Other oddball situations can emerge also. Say for example someone ships something from Atlanta to International Falls, Mn. via Old Dominion. It could work like this: OD picks up the trailer from the shipper and takes it to their yard (full truckload - but LTL freight). They broker JB Hunt to pull the trailer to their Minneapolis terminal. Then they have Magnum do the LTL stuff in Intl Falls so they pick it up from ODs yard in Mpls and delivers it. Magnum would be the final mile.
     
    Last edited: Feb 11, 2023
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  5. Newtrucker123579

    Newtrucker123579 Light Load Member

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    Thank you! So final mile is the delivery to the actual customer? I looked at JB Hunts final mile division and it kind of confuses. So it’s safe to say doing loads from load boards is not final mile deliveries? Or it is?
     
  6. Knightcrawler

    Knightcrawler Road Train Member

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    Whatever company bumps the dock at the receiver is the "final mile". Thus the reason it is called the final mile.

    The receiver may or may not be the customer. Lets say Menards has XYZ trucking company (the delivery company - ie "the final mile") deliver something for abc renovations (who would be the actual customer - but for the trucking company, Menards is the customer) to Bobs grocery mart (the receiver) because abc is doing some work for Bob.

    Lets muddy it up further. Lets say Menards got CH Robinson to broker this load. So Menards is CH Robinsons customer, CH Robinson is XYZs customer, ABC is Menards customer, and Bob is ABCs customer.

    Thus the reason drivers say "shipper" or "receiver". It cuts down on the confusion...
     
    Last edited: Feb 11, 2023
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  7. Newtrucker123579

    Newtrucker123579 Light Load Member

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    Thank you again, so can I ask I see these types of loads on peoples net pay be way more than JB Hunts revenue vs operating income, they made 688M in revenue and only brought home 1M, is It really not that profitable? Also with their intermodal division I’m still kind of confused on that, do they charge a fee for shipments through transporting goods on the railroads? Or do they solely make money from picking up the shipments and delivering them?
     
  8. Knightcrawler

    Knightcrawler Road Train Member

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    The margins in the trucking world are incredibly thin. 1-3%.

    How JB makes money is something you would have to ask them.
     
    Last edited: Feb 11, 2023
  9. Newtrucker123579

    Newtrucker123579 Light Load Member

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    Right but it looks like they’re intermodal division profits 60% of revenue, so it makes me wonder if they’re doing just the delivering on trucks or if they have containers that they charge a fee on the railroads to move customers freight?
     
  10. kemosabi49

    kemosabi49 Trucker Forum STAFF Staff Member

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    JB Hunt went heavy into Intermodal several years ago. They cut a pretty good deal with the railroads, mainly Union Pacific and BNSF. And although they do have trucks/drivers dedicated to move these trailers, they get a lot of other companies to move them from the rail yards to the end customer. Many of their loads get from shipper to the rails to end customer without an actual JB Hunt truck ever getting into the mix. And that's with over 24,000 trucks of their own. They wouldn't use so many outside carriers if it wasn't cheaper for them.
     
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  11. Allow Me.

    Allow Me. Trucker Forum STAFF Staff Member

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    When I worked for FFE years ago, we had about 6-7 terminals which included warehouses with cold storage. Also FFE owned about 5 truck co's which could use these warehouses. The parent co was Conwell (there name was on your paycheck) The warehouses were, in my opinion, to store freight and add an empty trailer to the fleet. In other words, truck 123 picks his load due at the other end in 4 days, but he arrives in 2 days, so he unloads at a co warehouse and can now get another load. If I remember, we let any truck co use our facilities if we had the room.
     
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