Adrian Gonzalez Gist Quotations

Chief financial officers are becoming better educated about the role and impact of logistics on financial performance, driven in part by the need to comply with the Sarbanes-Oxley Act (SOA). Many companies, however, do not have a clear and accurate understanding of their transportation costs. They're often bundled together with other costs and reported at an aggregated level, thus preventing companies from allocating transportation costs to specific products, customers, or business units.

Generally speaking, logistics services is a low-margin business and driving profitable growth is becoming increasingly difficult.

The consolidation trend will certainly continue in 2006, and it won't always be the 'usual suspects' involved in the deals. We expect to see logistics service providers and financial institutions make some TMS-related acquisitions this year as they attempt to 'roll up' providers of complementary solutions in order to accelerate scale and growth.