On Episode 46 of the Edge of Innovation, we are talking with Taylor Robinson of PLG Consulting, about how transportation logistics builds the future. It’s the breath of our economy!
The Breath of our Economy. How Transportation Logistics Builds the Future with Taylor Robinson of PLG
Paul: Hello. My name is Paul Parisi, and I’m here with Taylor Robinson, the president of PLG Consulting. Hi, Taylor.
Taylor: Good afternoon, Paul.
Paul: So now, I know I’ve talked to a lot of different business owners and people who run businesses. And they get excited about what they do. Is logistics like that for you? Is that something that just like, “Yeah, that’s really cool. We just saved that company all this money by doing this different technique or using this.” Is that something where you feel like you hit a homerun, that feeling that this is cool? Or is it, no, it’s just a job. Because I know you have a lot of really — I don’t know — not eclectic, but people that are experts in these fields that are fairly narrow, but they know their stuff, and they’re probably the…maybe even one of the best experts on the planet for it, especially with relationships. They know the people in the industries. They know the people at the train company. They know the people that make the hoppers. All these different things. So it must be really cool to impact some of this stuff. What do you think about that?
Taylor: Yeah. Well, it’s really a balancing act. My job’s a balancing act because we’re small. We have contractors. They’re extremely talented contactors, and my job is to get them to work. And there’s not hundreds of opportunities out there for these niches. So it’s all about balancing, having the right team available and having the relationship with the clients that know us and are going to call us when they need help. And of course, that’s an imperfect balancing act. And there’s lots of ups and downs.
Paul: Sure. Do you know all of your customers? I mean, I know you do. But I’m saying the customers you’ll have, if we go roll forward five years, do you know them all now? Or are there going to be people that you didn’t know?
Taylor: It’s going to be a mix. Yeah. You know, we’ve got 20 strategic accounts that we want to invest in. We think they’re going to come back again at some point.
Paul: But who are the people that are out there that don’t know your name. They don’t know you guys. How do you connect with them? Is there industry stuff that you do? Or how do you actually reach out to them. I’m the logistics person at company XYZ, and I’ve never heard of you guys. Well, it would be really nice because you’re in a nice size where it matters, at your size, that your customer be successful as opposed to a really a big company that’s like, “Yeah, we didn’t do a great job,” or, “They didn’t see a benefit there.” It doesn’t matter. We’ve got 20 other, 50 other companies that we’re working with. So I imagine engaging with PLG I’m going to get very high quality of relationship as well as service. So how do I identify those people?
Taylor: I think just the given is we have to perform at every opportunity we have at a world-class level so that our reputation precedes us because much of our business is either repeat or referrals, free referrals that we don’t even know about. We’ve had clients refer us to two or three other customers. And so therefore, if we’re performing, we’ve got a chance of growing on its own.
I think secondly, we like to speak at conferences in these very focused markets, again, either on the transport side around rail or energy and chemical, our biggest, biggest verticals. We need to be out there so people recognize that we’re well known. And we’ve got a reputation of serving our customers. And to do that, we have to put together very innovative presentations. We have to be better than anybody else at the conference. It’s got to give them more information. It’s got to be more relevant. It’s got to be different than everyone there. So we put an incredible amount of time in sharing enough to get them interested but not sharing all the secrets.
Paul: Sure. Of course. Yeah.
Taylor: So that’s one of the main ways. And then we’ve got a following of about 2200 people that have signed up for our information we send out on a monthly basis where we give those presentations or other things, and we’re doing more webinars.
Paul: So who are the webinars targeted at? Is it the CEO? Is it the logistics officer? Chief logistics officer, is that a title?
Taylor: Yeah. It’s those type of people. But a lot of times, they send their staff. But if they bring the presentation and talk to the person that sent them and give another favorable impression, we’ve got a chance.
Paul: Right. Now is it sort of like there’s best practices, and then there’s specific best practices? Or is it every company is a new ballgame that you’re working with?
Taylor: It’s a mix because people have these very difficult solutions that they might find us through the internet, you know. Through a search, through our website. Many times, it’s referrals, but we get searches. We get one a month, at least, that call up and say, “Hey, I found you on the internet. I’ve got this bulk problem.” We had one last fall that they’re going to build out a whole supply chain for moving a bulk product from the Caribbean to throughout North America. And we’re going to help them with that whole end-to-end strategy, from the feasibility stage to building it out. So that company did a search of bulk logistics, and we’re up near the top. It’s a great place to be because not many people claim it. But it’s not a great place to be because not many people search it. So it’s that paradigm of how do we find our clients. The web is becoming an increasingly important part of that as our customer base gets a little bit younger.
Paul: Oh, I see. Okay. That’s an interesting trend. So is it that this is an older industry now? Is it moving into the younger ages? Or how is that impacting things?
Taylor: Well, a lot of the logistics folks, especially that worked with the railroads, generally are older. And it takes a long time to be effective with the railroads, to have enough knowledge, to have enough respect to be effective. And that person, they don’t normally want to change. Nobody wants to take that job. So that person tends to retire after about 20 years of doing that. And how do they replace them?
Paul: Yeah. Because you can’t build that relationship quickly.
Taylor: Right. And what did he really do? How did he really get that deal? How did he make that train move that wasn’t moving? So a lot of that inherent knowledge retires. And also, there’s a lot of turnover. And a lot of the senior leaders have never worked with the railroads, as an example. So we can come in and, again, we love to assess where people are at, offer suggestions, and train them up, and get them on a road to improvement.
Paul: It sounds like some of those people are strategic risks to the companies that they’re in because if they go away, that’s lost information. Its institutional mind is gone as far as delivering that stuff. Wow, that’s fascinating. So do these logisticians document everything? Is there a book that they have and this is how we do it, or is it just in their heads?
Taylor: A little bit of both. Depends of the company. The smaller companies tend to have tribal knowledge, and it retires, and it’s gone. And they might not appreciate that person till after he’s retired when things start going downhill.
Paul: Are there software systems that help with this, help manage this?
Taylor: Yeah. Certainly. Managing the rail, managing the trucks, there’s better and better technology. It’s a constantly evolving aspect. We help folks with assessing where they’re at in their rail or trucks management system, maybe improving their system, going out and buying a new one. It’s a constantly changing world with the cloud. And cloud-based systems are taking tremendous costs out of logistics.
Paul: So I’ve built a lot of software systems, and I’m wondering is there a system out there that says it currently knows how busy each shipper is and where their trains are going, how full they are, so I can almost — I wouldn’t want to use the word — arbitrage it and say, oh, I know that that railroad is not heavily utilized right now. So I can go to them and sort of negotiate maybe a lower price or just I need to get it there, so I’m going to go to that railroad as opposed to take a ride on the Reading railroad. Is it Reading or B&O?
Paul: Reading. So, are systems like that evolving with that transparency for logistics?
Taylor: The challenge with that example is railroads are almost a monopoly, so technology doesn’t help a whole lot with that aspect. Very seldom is there competition. Now you go to the trucking world where you have Less Than Truckloads. You know, that’s somebody who wants to move a skid from Beverly, Massachusetts here to Paducah, Kentucky. And that load might cost a thousand dollars. Right now, about $250 of that cost is brokerage fees.
Paul: Really. Wow. And so the brokers are doing that.
Taylor: Yeah. And the brokers are arranging. Now they’ve got systems that do that, but they charge a lot for that, and they have to take people out to lunch a lot. And so there’s this excess waste in the system. There are a number of softwares that are attacking that, as you can imagine, with dynamic scheduling—
Paul: Right. Exactly. That’s what I was thinking.
Taylor: And if they can get the shippers and the trucking companies to sign up, and they get enough scale, they’re going to take that cost down by three, four times. I mean, it’s going to be a third, a quarter of that cost.
Paul: Commoditize it.
Taylor: Yes. And make it much more efficient, get more trucks working as opposed to the guy waiting for his load, he can look online. He sees one. I mean, it’s Uber in trucking.
Paul: Right. Yeah. That’s fascinating.
Taylor: That will happen. That will happen in less than truckload. That will happen in truckload because there’s lots of competition, whereas the rail, it’s from point A to point B. You have railroad.
Paul: Is the railroad… Right now, in the telecommunications world, when they were divested, AT&T, the wires were basically…they had to carry AT&T traffic or MCI traffic at the time. So there was not this exclusive that only AT&T calls could come to your house. Anybody could call. That’s not the way it is in the rail world. Do they rent the rails? Or how does that work?
Taylor: Well, when the rail got privatized, they have to build their own rail. So they don’t easily let their competition ride on their rail. There are places where it’s common, or there are short lines that serve both of them. But most of the time, it’s their rail. And they’re spending three, four, five billion dollars a year keeping that rail up.
Paul: Wow. So it, it’s an exclusive road, if you will, railway.
Taylor: Yeah. They built their road, and they can ship as they please on that. Now there are laws that they have to be reasonable and so forth, but they have lots of leverage when you own the road.
Paul: Interesting. Wow. Again, another thing that I wouldn’t have thought of. So now you said it started out as Plastics Logistics Group, and now it’s Professional?
Taylor: It went to Professional Logistics Group. When I started about five years ago, we branded it PLG because it’s just easier, and it was already known. Logistics is actually a hot topic now, so we call ourselves Professional Logistics Group. PLG has become known in this niche. You don’t have to go any further. They just…oh, call PLG. Or on the other side, if you’re retiring, you’re a logistics professional, and you’ve got a retirement package, but you’re feeling pretty good, and you don’t want to sit around and play golf or go fishing every day, you come home to PLG. And we provide you with an opportunity to work on projects part-time at your discretion.
Paul: Yeah. It sounds like the best of all.
Taylor: Yeah. If you want to go to Costa Rica for, for a month, please go ahead, but the other 11 months of the year, we might call you and — guess what? — you get to work with your old buddy that you used to work with. And it’s remote, though. It’s a different world.
Paul: So your people don’t all go to the same office. They work out of their homes—
Taylor: Almost never.
Paul: —Or wherever they want to.
Taylor: Yeah. We’ve got over 40 people all over North America that we can call on. We’ve got about 10 partner companies, partner consulting firms or engineering firms that, that we pull in and out. And they pull us in. So we’ve got a network even bigger than that 40, 45 people that we have. Again, if a client brings me a problem, I have a 48-hour rule that I need to be able to talk to my network and find one or two or three experts in that niche.
Paul: And it matters to you guys. I think that’s one of the biggest things is that you don’t have a thousand employees, and you’re not a big, huge consulting company. I would imagine working with that matters to all the people. They’re aware of the different projects that are going on and interested in it and contributing.
Taylor: Yeah. And there’s not enough work for them. I mean, I could bring lots more work to them, and they have plenty of capacity, and it’s because they’re very talented. They’re very experienced. They could take five times longer to finish, fix some of these issues. They can do it. And, so therefore, I’m spending a lot of time and our team is looking for more projects to put more folks to work.
Paul: Right. That’s so cool. Well we’ve been talking with Taylor Robinson, president of PLG, PLG Consulting, experts in bulk logistics. And it’s fascinating that there’s this whole sub-culture, if you will, of the way things are moving and it’s part of the breath of the country. It’s fascinating.