XPO Logistics takes steps to expand last mile network in Chicago area

Taking steps to expand its last-mile logistics network, freight transportation and logistics provider XPO Logistics announced that it has expanded its “Chicagoland” facility in Bollingbrook, Ill.

Company officials say that this new facility doubles the capacity of XPO’s Chicago-based market delivery center (MDC), which serves large retailers, e-commerce service providers, and heavy goods manufacturers, to almost 100,000 square feet.

XPO defines the MDC as a facility that receives product, schedules product, and, as needed, prepares and assembles product at that site before it heads out to delivery. It also takes care of customer service issues, and conducts a “check in” of product that comes off of trucks for reverse logistics products that need to go back to a retailer or manufacturer for any reason.

In an interview with Logistics Management, Charlie Hitt, president of XPO’s last mile business unit, said that Chicago is one of XPO’s three busiest and fastest-growing markets nationwide. “We need to invest in what our customers are having happen in the growth of their business, particularly in e-commerce.”

The impact of a rapidly growing e-commerce market on the last mile sector, especially for heavy goods, is something that cannot be overstated, stressed Hitt.

For XPO, that e-commerce activity, in terms of client relations, continues to grow.

“We have had 15% to 20% growth in the last quarter alone in e-commerce business,” Hitt says. “Traditional brick and mortar retailers are expanding out with more e-commerce offerings, and they want it to be seamless and they want it fast.”

Prior to this announcement, the Chicagoland MDC was roughly 50,000 square-feet and handled last-mile for retailers, as well as business that came in from Internet sales than can plug into the XPO system.

“We think this business will grow 30% to 40% next year in Chicago, but it could be more and we’re going to be opportunistic about that if that happens,” said Hitt. He explained that this forecast is reflective of an ongoing “do it for me” theme among consumers in that they don’t want to do something like pick up a TV at a store and hook it up on their own.

“Now, they want someone to take the old TV or washer and dryer away or have it done for them,” notes Hitt. “That is what they want; they want things to be simple.”