The President’s Report 2022
Dear Clients, Partners, Vendors, & Friends –
Wow! What a year it has been for both The Scarbrough Group as a whole and for me personally. Our values of Faith – Family – Work took on a whole new meaning for me this year as we lost our beloved dog Ella (the unofficial office greeter & Scarbrough mascot) along with my wife and I growing our family with a baby girl who has certainly brought more joy into our home than I could have imagined.
Now back to work…The Scarbrough Group and all its subsidiaries had a year full of triumphs. As you may recall, that was our goal heading into this year – to THRIVE. Most notably for the Group, we moved into our new corporate headquarters located in the Northland of Kansas City within Zona Rosa. This past Friday, December 9, we were able to host friends and family alike at our Open House. The event was a great success. To those who made it out, thank you! And to those of you who were not able to attend we look forward to hosting you at our new HQ soon!
Within our International division (Scarbrough International & Scarbrough Consulting), the year was full of positive momentum. Scarbrough International officially launched Special Projects Division (SPD). While this has been part of the Scarbrough International offering for many years, we wanted to give the work, and the people running it, the credit and publicity they all deserved. SPD tackles your toughest logistics challenges when your cargo just won’t fit in a shipping container. The division is headed by Senior Director, Mr. Patrick Colligan, who has been with Scarbrough nearly 17 years. In addition to launching SPD, Scarbrough International’s Mexican subsidiary, Scarbrough Mexicana (SMX), was able to add offices in the western ocean port of Manzanillo, Colima, Mexico and the border crossing combination of Ciudad Juarez, Chihuahua, Mexico and its sister city in the US – El Paso, Texas.
Our Domestic division (Scarbrough Logistics & Scarbrough Transportation) did not disappoint either! We were able to double our trailer pool and increase our fleet by another 20% this year (on top of 25% growth last year), continuing Scarbrough Logistics’ impressive run. Scarbrough Transportation had another year for the record books with growth north of 250% and the launch of three new service offerings – Dedicated Drayage Management, Freight Pay & Audit, and Cost Containment.
And finally, our Warehousing division (Scarbrough Warehousing) continued its meteoric rise in 2022. When I wrote last year’s letter, we had just tripled our warehouse footprint to 226,000 square feet. It didn’t take long for us to nearly double that space again in April of this year, taking our total footprint to 416,000 square feet in the Kansas City region alone. With that increase came new business and new opportunities within the eCommerce landscape along with a renewed focus on kitting operations for our clients.
I am often asked to get out my crystal ball around this time of year, and as much as I shake it, it is as hazy as ever! In general, we represent clients from most all industries, both large and small — here are a few things we have noticed. From a warehousing perspective, we have seen a dip in the direct-to-consumer eCommerce model. But we have more than made up for it with an uptick in the business-to-business model where our clients are fulfilling brick and mortar rather than the end customer directly. On the domestic front, the exorbitant demurrage that everyone has paid in the last few years has given rise to the idea that managing your inbound containers from the container yard to your door and then back has become increasingly important and yet often overlooked. On the international front two insights come to mind: (1) These rates are unsustainable in the long run but will be with us for at least the next few months; (2) The majority of our client base is up from 2019 levels (albeit down from ’20 & ’21 levels) which is an interesting, yet often overlooked piece of information.
In closing, I hope this message finds you all well. Take this Holiday Season to appreciate all that you have been given and enjoy the Season with family and friends.
My very best,
President & Chief Operating Officer
The Scarbrough Group