The CEO’s Report 2023
Dear Client, Partners, Vendors, and Friends –
A new year is upon us and attempting to keep up with tradition, I am excited to bring you this year’s report.
We pride ourselves on being best in class in many ways, and I dropped the ball in December for which I would like to make amends. We often post to social media about new hires and promotions of our senior-level leaders. However, I missed a very important moment in the career of one of our most senior leaders, Ms. Kathy Shanks – retirement! Kathy worked for Scarbrough for almost 30 years starting her career as Roger’s Executive Assistant and ending it as a Board Member & Executive Vice President, quite an accomplishment in itself! Kathy is the very definition of best in class, and she will be sorely missed by us all. Kathy, thank you for being you and pushing us all (and most importantly me) to be better every day!
2023, A Look Back at Scarbrough and the Industry
While the logistics industry has been in the news for the past few years (both positive & negative), this year seemed to be much more negative than positive and most of that was felt at a human level. We saw mass-layoffs from industry giants like C.H. Robinson (just to name one) and one of the most prolific exits in our industry this past year with the doors forever closing at truck broker Convoy, which was valued at over $3 billion just last year. And we can’t forget Yellow’s bankruptcy too. In addition to these headline grabbing names, there have been countless smaller and mid-size logistics companies calling it quits throughout 2023 with some estimates as high as 35,000 companies.
We saw TPEB ocean rates drop to pre-pandemic levels (if not lower for a period of time). Yellow’s bankruptcy caused a massive shift in the LTL market to which we still have not yet seen the full fallout. In addition, we saw truckload rates plummet from just last year. The year ended with a crisis in the Red Sea that continues as I write this, and some potential rate increases in the ocean markets. While these prolific rate reductions in containerized freight along with TL seem to be good for shippers, in the long run these rate levels are not positive for the industry as a whole.
With 2023 seeming to be doom & gloom for the majority of our competitors, Scarbrough was able to shine a bit brighter than usual with a few awards:
- The Kansas City Business Journal recognized us for being one of the 50 fastest growing companies over the past two years in KC (#38).
- Scarbrough International was voted Partner of the Year for the WorldNet Association by its peers.
- And only because Marketing said I had to include it, Ingram’s recognized me as a part of the Ingram’s 250 Kansas City’s Most Influential Business Leaders.
In addition to these awards, 2023 came with some senior-level hires for Scarbrough, namely Mr. Matt Wilcox (Vice President & Managing Director, Scarbrough Transportation), Ms. Tracy Schellmann (Director, Marketing & Communications), and Ms. Erin O’Leary (Director, Enterprise Services).
2024, The Best Laid Plans…
From an industry perspective, it seems that the majority of our clients sold through the mountains of inventory they had acquired during the Pandemic. While that usually means a drop in freight (see paragraph about industry layoffs and closings) it does mean that many of our clients had a very positive year and should look to start shipping more in ’24. We saw this trend across many of our clients towards the end of the fourth quarter and are anticipating a year in ’24 that is better than ’23 when it comes to the general health of the freight industry. I say all of this knowing that intermittent southern border closures along with an ongoing crisis in the Red Sea means anything can happen, like I said, the best laid plans…
Now for our best laid plans…
Our 40th Anniversary!
Scarbrough was founded in 1984 and while I was here for the party when we hit 30, I could not be more excited to host our 40th as our CEO. A Save the Date will be coming to an inbox near you soon, but until then the date of the party is April 26, 2024.
Many of you know us by the name Scarbrough International (our founding name) which is reflected in our email address domain (scarbrough-intl.com) and website. Some of you know us as one of our other operating companies – Transportation, Logistics, Warehousing, Consulting, maybe even our Mexican subsidiaries Scarbrough Mexicana or Scarbrough de Mexico. And then there is The Scarbrough Group, our holding company.
While we will be keeping the operating companies as you know them today, we will be updating our holding company name, email, and website domain to more accurately reflect who we are, Global. In the coming months you will be receiving news on our update to scarbroughglobal.com.
In December ’23 we entered into an agreement to purchase the shares of a Canadian customs broker & consulting company and integrate their operation into Scarbrough International. We plan to finalize the integration by April 1, 2024 (I don’t think it will make a fool of me) and at that point Scarbrough will be fully operational covering the North American continent with Customs Brokerage & Freight Forwarding offerings in Mexico, the US, and now Canada!
At Scarbrough, we are continuing the push to be Best in Class while continuing to ask you to Expect More from us.
I sincerely hope you were able to take some time to enjoy friends and family during the Holidays and here’s to wishing you all a very healthy & successful ’24!
All the best,
Chief Executive Officer