Expeditors International of Washington, Inc. (EXPD) Earnings Call Transcript & Summary

Good morning, everyone. Thank you for joining our webinar today. I'm Courtney Hickam, Customer Retention and Development Manager for the New York District. I'll be kicking us off today. Longjie will be presenting and will be covering our quoting and online booking tools, which I'm super excited for. I know from my role, I get a lot of requests for quoting. So allowing our customers to be more self-sufficient on this, to me is a home run. So I hope you enjoy the webinar today. And just to note, we will be recording it. And as part of our follow-up, we'll be providing a recording of this webinar. So thank you again. And Longjie, I will turn it over to you.

All right. Thank you, Courtney, and thank you, everybody, for joining us today. Today, we're going to be talking a little bit about online quoting, online booking and essentially making that quote-to-book process as efficient as possible for you guys. So we had a poll question that as you guys were joining, we put through. So it seems like a lot of folks out there are currently, to book shipments out, were sending out e-mails, very similar answers for how freight is currently booked. Some folks out there calling using web quotations, I mean utilizing third parties. And on average, it seems like folks are spending somewhere between half an hour to an hour, some folks a little bit longer than that, in their quoting and booking process on a weekly basis. So that's all good information. I think mostly people are really bunched up around those results right there. So this is exactly the right information that we need to better serve our customers. And hopefully, we'll give you guys some ideas on how to make your own internal processes a little bit more streamlined. All of the modules we're going to be presenting to you today fall within Expeditors Expo Now platform. This is our new platform that we're been launching last couple of years, putting more and more modules into place. We've already had the tracking and tracing module of Expo now live for a while now. Hopefully, some of you out there have either used that or some of our legacy tools for your tracking and tracing and booking needs. But we're very excited to announce that due to feedback from our customers, we're going to be expanding the functionality to instant online quoting, as well as a revamped version of our [ web ] booking tool as part of the modules. Expo Now is not only just for quoting and booking and tracking, as I have mentioned. You can do much, much more with it. We're constantly adding more functionality to it to bring features that our customers are most asking for. Some of the features we've been able to turn on recently have included our order management platform for those of you who need even increased upstream visibility. We've added reporting and analytics not only to our freight products. But additionally, if you utilize Expeditors for things like our warehousing and distribution services, we have those built in as well. So we're certainly increasing the functionality, but the 2 features that we are most excited about today that we're going to be discussing is the quoting and booking tool. Now through all of the modules, hopefully, you'll have a better experience, you're going to see some integrations before that you may not have based off of your legacy tools, as well as the ability to kind of tailor how things look. We'll get into that as we go through the tools themselves. So how do you get into EXP.O NOW? Well, if you don't already have an account, please reach out after the call. We can certainly set you up. Or if you have an account manager, please reach out. We can set you up very quickly with an EXP.O NOW account. It is usable on desktop, on mobile. There is no separate app to download to utilize EXP.O NOW. It's all built in with our kind of unified design. When you first log in or if you've been in already, you'll know that at your fingertips, you'll have access to all of your shipments you're moving with Expeditors. You'll have our -- our Expeditors news flashes to keep you up to date of all the things that's been happening throughout the supply chain. We've certainly had an interesting week thus far, at least in the States. We had an impending rail strike that was looming, that was going to actually potentially happen this week that was just averted. So not only is EXP.O NOW a great hub for you to find information as it relates to your shipments, but the broader supply chain in general. So let's talk a little bit about the first module that we're going to cover today, and we're going to follow this up by a live demo as well. And this is our air quote tool. Expeditors -- I've been at Expeditors for 8 years now. Most of that time has been spent in my role as Customer Solutions Manager here in the Northeast. But we've never had online instant quotes before. We've slowly rolled this out through the beta process. Even now, we probably have some origins and destinations that need both your feedback and your use on it. But we're very happy to launch our online air quote system. So if this would be of interest to you, if you have need for instant online air quotes, the wait is over. We can flip that on with the flick of a switch within your EXP.O NOW account. And through the online quoting tool, you'll be able to go in, fill in 3 simple sections, you just provide things like where you're shipping freight from, [ and too ] some details about your freight and whether you want any additional services such as brokerage services and clearance services, for Expeditors to perform in addition to moving your freight. And we'll have an instant binding quote available for you at the tail end. All you need to do is to essentially follow the additional steps to go through with that online instant quote, and you'll have freight moved on those rate sheets as quickly as a few minutes. We'll step through that a little bit later. The second part that we're going to cover today deals with our ability to actually book and move shipments. Now you may have shipments that with Expeditors you already have a set tariff with. In that poll question we asked you guys before, I think a lot of people said that you don't necessarily quote out every shipment. But ultimately, a shipment needs to be booked somehow, whether that's through a systematic procedure such as an EDI connection or an EPi connection. Or if you're currently making your bookings through e-mails or phone calls or things like that, we'd love to introduce hopefully, a faster way to create those bookings. And that would be through the EXP.O NOW booking tool. Some of you may be familiar with our legacy Expo booking tools. This should feel very similar to you. We've updated our pages within the same design language as our EXP.O NOW platform, and it has the same ease of use where you go in, tell us a little bit about what you're moving and create a booking out of it, regardless of if you already have a quote on hand or have something that needs a fresh, a new lane that you might be moving across. So both of those modules are available. And let me show how you can get there in Expo. So I'm also actually going to be running this through a couple of different browsers as well, so you can guys can get a different feel for how this looks like in a Chrome browser, in the Microsoft Edge browser. So let's say I wanted to go ahead and create a new quote. Right up in EXP.O NOW in the menu on the top page, I would select that quote menu option at the top. This brings me over to the quotations I've already made, as well as the ability to create a new quote. Now when I hit the create new quote button, it's going to pre-populate some of the things that are already in here, such as my organization, my e-mail address saved in and my contact phone number. If you need those changed, they are right up in your preferences in your account, and you can update those if need be. We do ask that instead of having a shared account to create quotes, that you do them within your own Expo account. Because that way they can kind of follow through, and if multiple users are logged into the same account, you might have an issue of an existing user being kicked out when a new user logs in. So when you set up this quote, first thing you have to do is to find the move type. So if you're moving it to airport to airport, you only have to provide the city and the country that you're moving it out from. But if you're doing, for example, a door-to-door move, you're going to want to actually provide an address. For the sake of showing both ands of that, let's go with a door to airport move. We're going to be moving things from the United States out, let's move it from our Expeditors Boston facility up in Peabody, Massachusetts. And you can see that will auto populate the rest of your address, if you so choose to utilize that functionality and prefill hopefully, the correct postal code as well as the city information. Now let's say we're doing an export shipment out to Shanghai. And if we type in destination country, let's go with China here. And then if we move to Shanghai, it will fill in all the other necessary details for us. Finally, if we want to add in additional shipper and content [ need ] information, we can do so by turning those elements on and off here. And we also have the ability to save things such as templates. So if you don't want to go and re-create things from scratch, you'll see that within our booking sections as well. You can also copy and paste a lot of this information from one existing quotation or booking to the next one as well. So we just have 2 more pages to go through here. We'll just describe what we're moving as well as the dimensionality of our freight. Finally, we're going to provide things like piece count and package types. So let's say we're moving 10 cartons, 100 kilos gross [ be ]. Okay. Finally, some additional services that we need to provide are things like whether you'd like to purchase additional insurance or if you'd like Expeditors to handle your import customs declaration as well. Another thing that you have to confirm is that shipments do not contain DGs such as lithium ion batteries and that the shipments that you're moving are not subject to ITAR regulations. If you had missed anything in the preceding field, you'll see on the left-hand side menu, there'll be these red warning signs pop up to indicate that there may be some missed information here. So I can go in and I can fix those errors, and those warning labels will turn themselves off so we can go in and we can say, "Oh, are -- we may have mislabeled the dimensionality of our freight, and we do have some limits on how much chargeable weight we're allowing in our data access. Our quoting tool is going to cap out at 1,500 kilos. So if you need a quote that's even larger than that, you won't necessarily be able to get an instant quote on that, but we'll be able to still accommodate you. But the instant online quoting, once you figure out all of that information, once you have checkmarks on the left side, you hit the Finalize button at the top. And what you get is a valid quote that's bookable immediately, or you can -- you have until, on this particular quote, the seventh of January to move it. All of these, what you see is what you're going to end up paying for that, and you can go ahead and take this, download that or book immediately across them. So that's how easy it is to take something from scratch and get a spot quote done on the EXP.O NOW quoting tool, super straightforward. And we certainly encourage you if this is something that may be of value, you have need for that instant turnaround of a quote, to go in and utilize that tool and let us know if that will be useful for you. All of the quotes that you've done are going to be in your quoting home page, so that shipment, that quote that I created is going to be right there waiting for me when I come back. It will also be listed with the expiration date here on the side as well. So if you need to quote out several lanes, get approval through your internal departments or through a finance permit. Or maybe you need an end customer that has an urgent load that needs to be moved quickly and you need to get their approval because ultimately, they're the ones paying for that. You can go ahead, generate those, see if those quotes [ on ] when you're ready, come back in and book across them. So that's just a quick run-through of our quoting tool. Now we have mentioned the second part of the presentation today, covered our booking tool. And as you may have seen up top, it's just as easy once you get there. So let me show you how easy that is. Again, from our home page, we can go up straight to the top, and right now it's switched over to a Microsoft (sic) [ Google ] Chrome browser. This is going to show us essentially the same information with a different view. I'll come back straight in so you can see the page reload up here. When I go to book, it's going to ask us which version of our booking tool. Now we still have several users still utilizing our legacy booking tool. And if that's your preference to use, absolutely feel free to continue utilizing our legacy tools. If you are interested in using our new tool or have never used our legacy tools, we'll be happy to onboard you to our new tool as well. When you come into this role, similar to our quoting tool, it will be met with all of the existing bookings you may have submitted already or have held in draft status ready to ship out. You can go into any of those straight by clicking straight into it. Or, as we're going to do, we're going to create a brand new booking to start with. Now the first thing that it's going to ask us is which modality that we're going to ship in. Now we do have our air booking tool, just like our quoting tool, launched already to any of our customers who would like to utilize it, but we are in beta for our ocean booking tool. So if that's of interest to you, please let us know, we can certainly get you into that booking group as well to utilize. And similar to our air tools, we're going to ask you, no matter which modality you're moving freight with, some basic information about your move to get that booking going. So a lot of these fields, we can save as a template. And you can see right at the top, we can actually apply a template. So instead of filling out this information from scratch, I can just use a template to save on typing for me. But for the purposes of showing how easy it is, we're going to actually do a lot of this from scratch. So for example, if I wanted to send this shipment from France over into the United States, again, I'm based out of our Peabody, Massachusetts office, so I'm going to enter in that information right here. And we can see here, as I finish some of these fields out, it is going to mark different sections as being completed. And once I've added this party, we can see that first section has a checkmark. As we proceed through some of these fields, there may be things that may not be as straightforward for you. For example, if you need guidance on things like whether you need additional information on port codes or insurance or any other fields, please feel free to reach out. We have your account manager [ on ] your operations team all ready to assist in case you run into any problems utilizing our booking tool. Go ahead, we'll add in all these additional fields where the freight is moving from, where it's moving to, requested delivery date as well as the [ service ] level. Okay. Again, all of these elements are going to start to change from these required red stars to check marks as we complete this. And if we ever miss a particular section, remember, it's going to warn us that we've missed something. So if we go into the next section without completing this, it's still going to stay red here. So we have to go in and complete this information, okay? Again, Expo booking is going to be smart enough, once you've entered in information, you can just essentially copy it to the other sections without having to retype everything over and over in [ avert ], right? It's going to have all that information already stored in here, right? So we can go through and here's where you can reference that quote number, maybe you have a standing rate sheet as well. And then finally, just like how we did with the quote, we provide some free details. And then any references. Now we require at least one reference in the reference section. So it could be, for example, a PO number. So this just helps on the tracking and tracing portion of Expo to eventually find your shipment again. So we'll go in, put in the purchase order number here, and we'll mark that as a shipper [ consa key ] and we'll dictate this is the primary reference. Now I can go in and add additional reference numbers. So for example, if I had a separate sales order number that was for my customer, I can do that as well. Super easy to add those references. They'll follow your shipment for the life of that shipment as well. And then finally, on documentation, the system can generate some documents, but if you have a commercial invoice or anything [ of this side ], this is where you can go and you can add that information in. So I can go in, add an additional document and say, hey, this is my commercial invoice from my packing list and such. And when that's all completed, you can go ahead and submit that shipment. And that shipment is going to then send out, and it's going to create an on-hand for us to carry through with this workflow. Now when this information is completed through, you'll see a green checkmark that this booking was submitted, and then you'll see here that, that booking within the home page of Booking is going to now be on that list of bookings, okay? So if we need to go back in, find additional details about that booking, we can click that Booking button, and immediately it will pull back all that information. If we need to do any additional tracking or things like that, EXP.O NOW's tracking and tracing capabilities can absolutely take over. So we can see all this information that was generated [ onto ] the system right in here. Super simple, super straightforward and if we ever need to utilize a template to pre-fill any of that information, that's going to be available as well. So that was a quick run-through of not only Expeditors' online quoting tool, but our booking tool as well. So you guys have seen the run-through of how simple it is to run through a quote from beginning to end, and get that finalized quote that you can book against. And also, how easy it was to go in straight from scratch or from a template, create a booking. All end-to-end, I would say a quote [ truly ] should take at most a couple of minutes to complete. A booking may be a little bit more complicated, especially if you have to attach multiple documents, but no more than 3 or 4 minutes to complete that either. And when you're eventually taking an existing booking and utilizing that as a basis for a new booking, your time that you need to spend in completing bookings should even be shorter through the use of copying up existing bookings in templates. So, that being said, hopefully you guys have gotten some more tools, but you may also have questions. So I'm going to ask Courtney to see if we have any questions out in the field, and if you're still thinking about that, still digesting on it, please feel free to use that Q&A box to give us any questions or concerns that you may have with utilizing our quoting tool or our booking tool.

Okay. Well, we do have a question. If a shipment is hazmat, can the quoting tool be used?

Yes, that's a great question. We are limiting some of the uses. I would say, reach out to your local office. We do have some limitations on things like dangerous goods on there for the booking tools, primarily because we want to make sure we have the right equipment ready for things like pickup and ultimate delivery. They may be a little bit outside of the scope of the original builds. But that said, that's functionality that we can build into our tools, make sure that we can apply that. But I would say, reach out to your local office and ask if there -- if you'll be able to make those bookings, based off of the type of goods that you're moving. Really, our local offices are going to have the expertise. And if they need a little bit more of an advanced heads up to get the right equipment, they're going to be knowledgeable on whether that can be used or not. And they'll coordinate with our destination offices to make sure that, that's available as well. Thank you for the question.

Yes, I would agree with that as well. Okay. Do we offer online quoting and booking for domestic truck moves?

Yes, that is also a good question. For LTL services, if you need individual pallets moved out, we do have a wholly owned subsidiary, it's known as Koho. The website is gokoho.com. And you can go and for any shipments, get an instant quote and book across that for some of our domestic services. If you need something a little bit larger than LTL can handle, if you need full truckloads, multiple full truckloads for something, that's something that we're still working on getting the right back end working, given that trucking has many, many more locations to deliver out to, potentially things that in a typical move would be considered beyond your additional mileage. We're still building out that back end to make sure that our freight quoting tools can properly provide that kind of information. So our Koho services, go ahead and utilize that for LTL moves. If you need something a little bit larger, please give us a shout, and we can prioritize working and beta-ing out something for domestic services with you. WE don't quite have that yet as built out as in our modules.

Okay. Another question. Does the quoting tool have a limited option of airports you can use?

So any airport where Expeditors would provide services from, you'd be able to use our quoting tool to do. And you don't have to necessarily know immediately which airport you're going to fly out of. For example, if you're based out of New York, and you need to move a shipment out of a warehouse in New Jersey. You don't have to necessarily know which is going to be the most optimal one. Just put in your origin office, or an airport you know you've moved goods out of before, whether that's EWR or JFK Airport. And then our local team will kind of make sure that they guide you to the right one. Maybe for your freight, a particular airline has a service that's leaving at the time that will meet your quality needs and your customer must-arrive-by date, and they'll work that out. Don't feel that you have to already know with a crystal ball, which airport that you're going to be shipping out of. Our local offices are going to be there to guide. And if you have any specific requirements, they can work with you as well. But I would say again, our local teams, depending on where you're based out of, are going to be the local experts, but you can absolutely use the tool and they'll kind of help you navigate which airport we can fly out of and which particular flight makes the most sense.

Okay. Sounds good. This is a question. How long are quotes valid for?

Great. That's a very good question. Let me see if I can go back on here. You can see here from these quotes that are generated at the top, typically speaking, you have a 1-month validity from the quotes generated from our online quoting tool. So that could be a great tool for you if you're not sure about something, get that quote in there and know that it's not going to expire the next day. You can go back to that quote, pull it back out, and that can be incredibly useful. We've seen a lot of change happen within on the marketplace. So go in, utilize that quoting service and then tuck that away, knowing that it's good for a month. So a good question, and we're happy to say that our quotes don't instantly expire the next day or within 48 hours or anything like that.

Right. Okay. And last, how long after the booking will I be able to track my freight?

That's a great question. So after you submit your booking within the EXP.O NOW booking tool, we do have one final step that we need to do on our tail end to essentially accept that freight in our operations level. So if you go out and you make hypothetically 30 shipments out of a very small airport that may not have a lot of lift capacity, well, we might have to, in some instances, come back and say, well, we don't actually have enough lift at this particular time and location. But for all typical day-to-day shipments, I would say within a few hours of you putting things in, assuming that the booking is done during business hours, you'll be able to immediately go over to the tracking side of things. And even before Expeditors has freight on hand, we'll have that tracking on hand available for you to start monitoring. And you can provide that tracking link to your end customer as well, so that they can track what that progress of that shipment is. So typically within a few hours, a few business hours of you going and making that booking, someone on the operations side will acknowledge that we are able to handle that, and it will be trackable from then on. After it's initially trackable, any updates will be communicated to you through the EXP.O NOW tracking trace module, typically within 10 to 15 minutes of an actual event occurring. So if a plane takes off, it's been wheels upped, you'll see that confirmed on board and that departure right in that track and trace tool within 10 to 15 minutes of it occurring. But that initial lag might take a couple of hours for us to acknowledge that we have kind of the right equipment and the right lift out of a particular area to go through. Same on the ocean bookings side as well, that we want to make sure that we have enough capacity to go through. We don't want to promise a particular sailing date and have a particular container roll. So give us a little bit of time and then it will be immediately trackable within that, which is a huge advantage to making bookings through more traditional means like e-mailing or calling. You may not have a reference number, once that's made immediately. We're utilizing an online booking tool, you immediately have that reference number, that BK number to be able to then reference back the track and trace off [ them ]. Okay. I appreciate the questions, guys.

All right. Thank you. Thank you again for the questions.

All right. Well, if there are no additional questions, I want to just thank everybody for their time today. We do have some information as it relates to additional resources. We have our Horizon Brief as well as our biweekly newsletter. We will be sending out a copy of the presentation afterwards, so don't feel like you have to rush and save any of this information immediately. This will be sent out to you so that you have this available for you. Thank you again so much for the time. Courtney, unless I'm forgetting anything, I think that's all we have for everybody today.

Yes, that's it. Well, thank you all for joining, we appreciate it. And look for more information on upcoming webinars. So thanks again. Have a great day.