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Presented by Rob Jones, Jacobson Companies
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Moving Iowa ForwardFuel Management
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Jacobson Overview
Click to edit Master title styleProud History of Expansion
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2010 Launch International Logistics Services (ILS)
1985 1990 1995 20001968 1980
1968 Opened 1st warehouse
2002 Opened first LMC outside of Des Moines & renewed focus on growing Carrier services
2004 Acquired by Norwest Equity Partners and management
2005 Acquired Bekins Logistics
2006 Acquired Phoenix-based Southwest Storage & Distribution
2006 Acquired Atlanta-based Wilpak, Inc
2006 Acquired St. Louis-based The Arthur Wells Group
2006 Oak Hill Acquired Arnold Logistics
2007 Acquired by Oak Hill & combined with Arnold Logistics
2008 Acquired Louisville-based Dixie Warehouse Services
2009 Brian Lutt joins as CEO. Restructure organization (CLS/TLS)
Over our 43-year history, Jacobson has evolved from a small warehouse-based company into one of the largest fully integrated logistics providers in the US
2006 2007 2008 20092002 2004 2010
2010 Acquires Global Transportation Services Inc.
2011 January - Establish legal entity Jacobson Global Logistics, Ltd in Hong Kong
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2011 January - Acquire Hong Kong based Chimerica Global Logistics, Ltd (CGL)
2011 February – Strategic Partnership formed with European company Rhenus Logistics
2011
2011 August – Acquire Singapore based G-Link Express Logistics
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1st Warehouse operation opened in 1968
Corporate Headquarters – Des Moines, Iowa
“Top 3” U.S. 3PL Managing 35 Million SF
197 sites serving over 1,500 customers
ISO 14001:2004 Certified
Asset Light U.S. Domestic Transportation and Freight Management business
545+ Tractors and 1,930+ Trailers
$600 Million in freight under management
Jacobson Today
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Service Profile by Revenue
Industry Vertical by Revenue
Click to edit Master title styleEnd-to-End Supply Chain Solutions
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Warehousing & Order Fulfillment (Dedicated and Multi-Tenant) Secondary Packaging & Project Management Contract Manufacturing Reverse Logistics Short/Long Term Staffing Solutions Facility Network Design & Planning Manufacturing Support High technology WMS solutions - Tier 1 WMS & ERP
Ocean & Airfreight Forwarding Consolidation at Origin Customs House Brokerage Deconsolidation & Trans loading Sea/Air Programs International & Domestic Warehousing, Transportation & Packaging Project Cargo Services Tracking &Tracing Tools
Full Truck Load Capacity Mgmt Cross-Dock/Freight Consolidation Over–the–Road Solutions Dedicated Contract Carriage Freight Management Mode Optimization Freight Bill Audit & Payment Transportation Management System (LINCS™)
International Logistics
Transportation Logistics
Contract Logistics
Click to edit Master title styleJacobson Locations
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International Logistics Services
Contract LogisticsServices
Transportation LogisticsServices
Offices
Jacobson/Rhenus
Partners/Agencies
Dedicated OperationsBulk Dedicated OperationsCross Dock OperationsLoad Management Centers
Dedicated Distribution Ctrs Multi-Tenant Distribution Ctrs
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Fuel Impact
Click to edit Master title styleFuel History
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$-
$0.500
$1.000
$1.500
$2.000
$2.500
$3.000
$3.500
$4.000
$4.500
$5.000
Weekly US Diesel Retail Prices
Source: U.S. Energy Information Administration
The Department of Energy projects diesel will average $4.21/gallon this summer, staying above $4.00 into 2013.
Click to edit Master title styleHow far on $500?
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March, 1999$0.997/gallon
March, 2012$4.127/gallon
February, 2005$2.027/gallon
April, 2003$1.533/gallon
May, 2010$3.069/gallon
Assuming 6 MPG
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$2.00 $2.50 $3.00 $3.50 $3.75 $4.00 $4.25
Fuel Expense Fuel Recovery
$/Gallon
$
Operating Expenses
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Fuel
2011
Fuel
2006
While a fuel surcharge or fuel peg adjustment provides some relief, there remains a gap that widens as fuel prices continue to escalate.
Increased expense continues to be spread across the supply chain.
Unprotected fuel expense
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Fuel Management Strategy
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Purchasing Focus Bulk fuel Price negotiations Fuel optimizer Purchasing discipline (are drivers
fueling at ‘network’ stops?) Purchase timing Hedging
Consumption Focus Improve MPG
Equipment Maintenance Driver
Reduce empty miles Reduce out-of-route miles
Recruit ‘in network’ drivers Training
Immediate and Ongoing
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Process & Partnership Reduce unproductive miles
(company trucks, owner operators, partner carriers)
Route optimization– Fewer miles– Continuous move opportunities
Shipment consolidation and distribution
– Reduce the amount of ‘air’ being transported
Network evaluation Getting closer to customers and
suppliers– Sourcing alternatives– Mode shift– Freight terms
Alternative Fuel Sources Natural Gas
Compressed natural gas Liquefied natural gas
Liquefied Petroleum Gas (Propane)
Biodiesel Ethanol
Strategic
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Source: U.S. Department of Energy
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Questions?
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Appendix
Click to edit Master title styleFuel Optimizer
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Origin: Des Moines, IA Destination: Los Angeles, CA Miles: 1,775
Fuel Level: 100 gallons Tank Capacity: 240 gallons MPG: 6.2 mpg
Pump Effective Pump EffectiveCity St Price Cost Gallons City St Price Cost Gallons
DES MOINES IA $3.760 $3.535 140 MILAN NM $3.929 $3.719 0
KEARNEY MO $3.705 $3.535 0 GALLUP NM $3.919 $3.709 0
N KANSAS CITY MO $3.821 $3.651 0 JAMESTOWN NM $3.941 $3.731 0
OTTAWA KS $3.834 $3.574 0 JOSEPH CITY AZ $3.913 $3.653 0
BETO JUNCTION KS $4.019 $3.759 0 WINSLOW AZ $3.924 $3.664 0
EMPORIA KS $3.843 $3.583 0 BELLEMONT AZ $3.903 $3.643 0
HOOKER OK $3.797 $3.667 0 KINGMAN AZ $3.858 $3.598 165
TUCUMCARI NM $3.875 $3.665 69 KINGMAN AZ $3.913 $3.653 0
SANTA ROSA NM $3.946 $3.736 0 LAKE HAVASU CITY AZ $3.930 $3.670 0
MORIARTY NM $3.956 $3.746 0 BARSTOW CA $4.090 $3.743 0
ALBUQUERQUE NM $3.917 $3.707 0 ONTARIO CA $4.051 $3.704 0
Click to edit Master title styleTiming Fuel Purchases
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Location: Marion, IN Price Change = Tomorrow’s Price – Today’s Price If Price Change <= ($0.020) then Fuel Tomorrow
Timing: ~ 13:00 CST If Price Change >= $0.020 then Fuel Today
JTLS Price FuelDate Price Change Recommendation
12/13/2011 $3.312 ($0.023) Fuel Tomorrow - Prices will be 2.3 cents lower
12/14/2011 $3.289 $0.020 Fuel Today - Prices will be 2.0 cents higher
12/15/2011 $3.309 ($0.082) Fuel Tomorrow - Prices will be 8.2 cents lower
12/16/2011 $3.227 $0.000 N/A
12/17/2011 $3.227 ($0.013) N/A
12/18/2011 $3.215 $0.000 N/A
12/19/2011 $3.215 $0.000 N/A
12/20/2011 $3.215 ($0.061) Fuel Tomorrow - Prices will be 6.1 cents lower
12/21/2011 $3.154 $0.076 Fuel Today - Prices will be 7.6 cents higher
12/22/2011 $3.230 $0.051 Fuel Today - Prices will be 5.1 cents higher
12/23/2011 $3.281
Click to edit Master title styleFuel Consumption Example
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Annual Miles 30,000,000MPG 6.00Gallons 5,000,000Fuel price $4.210Raw Fuel Cost $21,050,000
Percentage MilesOOR 9.50% 2,850,000Non-OOR 27,150,000MT 12.50% 3,393,750Loaded 87.50% 23,756,250
Fuel Surcharge Rate $0.50Fuel Surcharge Revenue $11,878,125
Net Fuel Cost $9,171,875Fuel Cost/Mile $0.306
CO2 Emissions 50,420 metric tons
Annual Miles 30,000,000MPG 6.10Gallons 4,918,033Fuel price $4.210Raw Fuel Cost $20,704,918
Percentage MilesOOR 9.00% 2,700,000Non-OOR 27,300,000MT 12.00% 3,276,000Loaded 88.00% 24,024,000
Fuel Surcharge Rate $0.50Fuel Surcharge Revenue $12,012,000
Net Fuel Cost $8,692,918Fuel Cost/Mile $0.290
CO2 Emissions 49,593 metric tons
Reduction to net fuel cost of $479,000