Echo gets into temperature-controlled market by acquiring Purple Plum
June 06, 2012
Echo Global Logistics, a non-asset based freight brokerage company and a provider of technology-enabled transportation and supply chain management services, said it has acquired Purple Plum Logistics LLC, a Wakefield, Mass.-based truckload transportation brokerage.
Financial terms of the transaction were not disclosed, but Echo officials said Purple Plum will immediately commence operations as Echo Global Logistics and be led by its president Sam Freni, whom will serve as regional vice president.
Purple Plum was established in July 2008 and focuses on temperature-controlled truckload services. In the last year, the company had roughly $17 million in gross revenue, according to Echo.
In an interview with LM, Echo CEO Doug Waggoner said that this deal made sense on multiple levels, including the leadership of Freni and Purple Plum’s Boston-area location, where Echo had not previously had a presence.
“Purple Plum has expertise in the temperature-controlled space,” he said. “We have an existing customer base in that area and now we will be able to get more temperature-controlled customers and sourcing into our scale and capability. And they give us those things on the temperature-controlled side, and we give them capabilities like dray van and LTL. This gives them to offer their customers those modes of service and an opportunity to grow the business as part of Echo.”
Prior to this acquisition, Echo served temperature-controlled customers from other offices, but now with Purple Plum in the fold, Waggoner explained Echo now has a physical presence in this space, which enables them to meet with customers face-to-face.
Benefits of this deal for customers, according to Waggoner, include more transportation capabilities for Purple Plum customers, including LTL, dry van, and intermodal as well. And Echo’s customers will benefit from Purple Plum’s strong carrier relationships with temperature-controlled carriers.
“In our business, we really think about having two clients: the shipper and the carrier,” said Waggoner. “It takes a happy carrier and a happy client for us to be successful. Scale also matters, too. In the brokerage business, having more loads makes you more attractive to carriers, and having more carriers makes you more attractive to shippers. If you truly want to make a market in brokerage, you have to have transactional ability and scale. We are continuously looking for ways to grow either organically or through smart acquisitions that make sense.”
One of Echo’s primary strategies, said Waggoner, is to become a multi-modal broker and be able to handle any kind of a shipment it gets from customers with a good service level and a competitive price and high customer service performance.
Purple Plum fits the bill in this instance, as it provides Echo with more geographical coverage, more scale, and expertise in the temperature-controlled market, he said.
“Purple Plum looks forward to joining the Echo team and contributing to
the temperature controlled truckload capabilities of Echo,” Freni in a statement. “Echo offers established technology, an extensive sales organization and a proven ability to service and grow its relationships with clients. Echo has retained the entire Purple Plum workforce in connection with this acquisition.”
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