A 3PL with its roots in the Christmas tree business was the top-ranked logistics and transportation company on this year’s Inc. 5000 list of the fastest-growing privately held companies in the U.S.
The representation of the logistics and transportation sector in the Inc. 5000 this year was down slightly from the prior year — and without the star power of a top 10 company this time around.
Whereas the Inc. 5000 list had 187 logistics and transportation companies in 2019, it was down to 167 companies this year, according to the recently released compilation. Last year, the logistics and transportation sector had the No. 2 overall company, FreightWise of the Nashville, Tennessee, area, with a more than three-year revenue growth rate back then of just under 30,550%.
This year, Tampa, Florida-based 3PL Cedar Grove Group, with a three-year growth rate of 3,268%, was the fastest-growing private logistics and transportation company on the list. It was ranked 108th.
FreightWise this year was fourth among all logistics and transportation companies and was 142nd overall. It was down from its more than 30,000% insane growth rate of last year to a merely crazy growth rate of 2,658%.
(Editor’s note: FreightWaves could not qualify for the list because it did not meet the requirement of having three years’ worth of revenue).
Cedar Grove describes itself as a “third-party logistics provider specializing in domestic and cross-border transportation. We help businesses to reduce their freight costs and improve operational processes,” CEO Rocco Malanga said in an email to FreightWaves.
He and his brother, Chris, actually started Cedar Grove on the back of work they already had done in moving Christmas trees. They “realized the barrier to market penetration within the fresh Christmas tree industry was transportation,” Malanga said. “So [we] started a transportation company, leveraged relationships and created a niche serving the Christmas tree industry.”
The company’s name comes from the company’s early tree-related facilities in Cedar Grove, New Jersey.
While Cedar Grove may have made its start with a yuletide theme, it has grown into a broader-based 3PL, with agriculture a growing part of the business. Trees are now a “fraction” of the business, Malanga said, but gave it a knowledge base of moving perishable, seasonal goods from rural areas to market.
“It’s a short shipping season,” Malanga said, but creates a knowledge base that “lends itself to other types of agricultural products” that also have tight windows to move products to market.
Other top-ranked transportation and logistics companies
* At Boxzooka, CEO Brendan Heegan has grown his company by 3,097% over the last three years, fitting into a space where he’s going up against the Fulfillment by Amazon service that the giant online retailer offers to third-party merchants selling on its site.
The company was 119th on this year’s list. In 2019, it wasn’t on the list at all.
“The beauty of what we do is that none of our clients sell on Amazon and most of them would never think of it,” believing that using their own websites and acting as a third-party seller “beneath them.” But they need a company to outsource the fulfillment activities for their sales, and that’s where Boxzooka comes in.
The roughly $20 million business began in 2014 just providing software for retailers bringing in imported goods. But once in place, it became a natural progression to provide other fulfillment services, eventually leading Boxzooka to brick-and-mortar space in New Jersey, where the company is based, as well as the West Coast and Pennsylvania.
Boxzooka has about 60 employees but Heegan said temporary employees can add another 100 to the workforce at any given time.
Boxzooka’s list of customers does contain what Heegan said were “a lot of fashion clients,” with fashion overall not performing well during the pandemic. “Some of them have gone up and some have gone down, but we’ve just been pretty stable and even-keeled through the pandemic.”
The company got into fashion early in its tenure because “not every 3PL is good at it, and we’re excellent at it.” But he added Boxzooka doesn’t want to be “pigeonholed” in that field and has been diversifying.
* Ally Logistics is a Michigan-based, full-service brokerage that was spun out of a larger company several years ago. It operates in the U.S. and Canada and has a staff of 42.
Dan Mansheam, Ally’s CEO, said that “just finding the right people probably has been the biggest factor for us,” putting up what Inc. said were growth rates of 2,658% over the past three years while operating a relatively standard-type 3PL.
“We try to be particular about who we bring in and we’ve gotten aggressive in terms of investments in personnel and in giving people the right tools,” Mansheam said.
Ally didn’t move that much in the rankings. It was 139th this year and was 120th last year.
* “We were worried initially,” FreightWise CEO Chris Corcoran told FreightWaves about how the company fared during the pandemic. He said FreightWise had a “handful of clients” who shut down completely “in nonessential businesses like toys” but also had essential business that supplied equipment to restaurants. That business obviously took a hit.
“But otherwise we held strong throughout the pandemic,” Corcoran said. “We lost no material clients from this.”
The company suffered a small dip in revenue and laid off no one from its 76-person staff, he said.
FreightWise recorded its first revenue in early 2016, when it had four employees. It was self-funded and had no outside venture capital money. Corcoran said FreightWise may eventually look to outside funding as a source of capital for acquisitions, “but right now, we’re sustaining without outside funding.”
FreightWise targets midsize businesses and their logistics needs, defined as companies with revenue as low as a few million dollars up to $100 million.
Its transportation solutions are focused on LTL and parcel; it doesn’t seek out truckload business. “The problem we’re solving is that it is cumbersome for a medium-sized business to efficiently buy and manage LTL and parcel, so that is the problem we’re solving,” Corcoran said.
Its activities range from brokerage-like services to payments, with a lot in between.
Some other statistics from the logistics and transportation segment of the Inc5000 list:
–Two cities tied for having the most companies on the list: Chattanooga (home of FreightWaves) and Chicago. Both had eight. The next highest number was three. Last year, Chattanooga had seven and Chicago had 10.
–Boosted by the Chicago numbers, but not solely because of it, Illinois had the most companies, 16. But even though the list has eight logistics and transportation companies listed as being in Chicago, most of the other 16 are in the Chicago metropolitan area. (Reliance Partners is also in Chattanooga and is overwhelmingly focused on transportation, though it was listed on the Inc5000 under the insurance segment.)
–Other states with a double-digit number of logistics and transportation companies on the list: California, Ohio, Tennessee and Texas.