Redwood Logistics announces its acquisition of Rockfarm Supply Chain Solutions

Chicago-based 4PL and logistics platform services provider Redwood Logistics said this week it has acquired Dubuque, IA-based Rockfarm Supply Chain Solutions and Global Distribution and Logistics, a tech-enabled transportation logistics company, focusing on flexible, customer-driven service.

A purchase price was not disclosed, but Redwood officials said that with Rockfarm in the fold that Redwood now represents a combined $5.5 billion in total platform freight under management between its 3PL and 4PL services.

Rockfarm was established in 2008. Redwood noted that a good number of Rockfarm’s core integration functions overlap with Redwood’s service portfolio, including expanded capabilities in transportation management, logistics execution, and freight visibility. What’s more, Redwood observed that with its North American footprint comprised of cross-border transportation services through Redwood Mexico, Rockfarm will provide Redwood with direct capabilities on various fronts, including international freight forwarding, trade compliance, and customs brokerage, as well as additional data warehouse, business intelligence, data translation and claims management tools and services to the Redwood portfolio.

Going forward, Redwood said that Rockfarm ownership, key leadership, management teams and team members will continue to operate as Redwood team members, adding that Rockfarm’s Dubuque, IA, operation center will continue as a Redwood logistics center.

Redwood CEO Mark Yeager providedLMwith a detailed overview of the acquisition in this Q&A below:

LM:What drove the need for Redwood to acquire Rockfarm? How long had it been planned/in the works?

Yeager:I don't think I would ever say there was a need for us to acquire Rockfarm. However, growth is obviously a critical part of our plans and our strategy going forward. And our strategy has always been to grow both through acquisition and organically. Rockfarm has been on our short list of acquisition candidates for quite some time, really for at least the last five years. And I think even prior to my joining the firm, we'd competed against Rockfarm. We knew how good they were. We knew that their customers thought very highly of them, and from what we knew of them, they were good people and similarly aligned to our values at Redwood. So, we had always thought that it was a company that matched up well with us.

They have similar services, but also some services that augment. As we dug deeper, we realized that there weren't things like customer overlap that could cause an issue for us. There wasn't a technology challenge because we understand their technology since they're a Mercury Gate shop as well. So, what looked like a good idea on paper got to be a better and better idea as we got to know them better. I think they felt a stronger comfort level as they got to know us as well.

So, I would say in some ways it's been planned for years and in some ways, we weren't certain it was going to happen until about a month ago. And we're all glad that it did.

LM:What does Rockfarm offer, or provide, for Redwood, that was needed or missing?

Yeager:I think there are things that the acquisition brings that are obvious. Among them are new customers and time-tested customers that have been a part of the Rockfarm family for a long time, and customers that are not currently customers of Redwood. They've got an amazing team and we are always looking to add new talent.

Rockfarm has some great talent on the tech side, on the managed services side, and at the top of the house. And we're excited that they're all going to be joining us. They're also bringing some services that we did not do not currently offer at Redwood, including freight forwarding, customs brokerage and a unique claims management capability that we think is going to be very applicable for some of our fully outsourced engagements on the managed side.

Rockfarm filled in some pieces for us, gave us some capabilities we haven't had historically, brought scope and scale as well to both brokerage and managed, which makes us a better purchaser. So, at the end of the day, a combined Redwood/Rock Farm enterprise is, we think, inherently stronger than both as separate units.

LM:What are the main benefits of this deal for Redwood's customers? In what ways does this deal help them?

Yeager:Now we can do more for our customers, including freight forwarding, including customs clearance, and we can also take on large scale claims projects with a high level of certainty and real expertise.

索赔是一个困难的事对很多客户s. They don't like handling it. Rock Farm is a specialist there, so it also adds scope and scale to brokerage and managed services. It's important because the more freight you control, the more freight you're buying, the more you can understand the market, the more you can provide value, in terms of analysis of market conditions versus what the customer currently has within their supply chain structure So, it makes us a better buyer on the one hand. It also makes us a more informed strategic consultant for the customer on the other side as well.

By becoming bigger and having more density and more activity, it just adds to our depth and understanding of the market. That gives us a leg up and, in turn, our customers a leg up.

And I would also say they have a very significant carrier base, much of which is additional to Redwood carrier base. So, combined, we're able to access more capacity that our shippers probably do not have access to, and that makes us a stronger partner, better able to assess the market, but also better able to execute due to the depth of the carrier base.

LM:On a separate but related note, how does Redwood define itself as a 4PL?

Yeager:Our services have evolved and we're now in a position to not just execute in the way a traditional 3PL does. We're also in a position to orchestrate the entire supply chain, help customers develop strategy, and execute on that strategy.

传统的第三方物流在执行如果很好de, not necessarily so good at orchestration, and not that great necessarily at helping their customers think through their supply chain strategy.

What enables us to do that is the platform that we've built, and at the core of that platform is RedwoodConnect. And by utilizing Redwood Connect as a tool, we're able to develop a strategy that has a comprehensive view of partners, of technologies, and of data sets and bring them in a customized way on an as needed basis.

A traditional 3PL is going to provide more of a walled garden approach, where they're going to have a specific playbook that they want to execute with the customer. We believe that most customers want a customized version of that. In order to do that, you really have to be at the very top. And the orchestration is at the heart of what differentiates a 4PL from a 3PL.