New truckload carrier aims to serve e-commerce and the middle mile

With e-commerce redrawing the landscape for freight transportation, a new Atlanta-based carrier recently launched as a middle-mile market provider across the South, Midwest and mid-Atlantic regions.

Ascend is a dry van, full truckload company with a family culture that innovates through experience and experimentation, CEO Michael McLary told FreightWaves.

McLary is a 30-year freight transportation industry veteran at companies such as UPS and Amazon.

“At UPS, the culture is family, you do what’s right for the employees, so it’s definitely bringing that type of culture,” McLary said. “At Amazon, it’s about experimenting, constantly trying to make yourself better. Don’t be satisfied with the status quo. Don’t say you can’t find a way to do it, make sure that you can solve problems. Ascend, it’s kind of a hybrid of both cultures that I think fit nicely together.”

Ascend currently has about 775 trucks, 2,270 trailers and more than 1,200 full-time drivers. The company uses a mix of company drivers and owner-operators. Ascend will focus on shippers in the retail, consumer goods, packaging and industrial supply chains.

“We stick with noncyclical goods, so we run e-commerce, retail, consumer goods, paper packaging, corrugated boxes, food and beverage, and dry products,” McLary said. “We tend to stay away from the cyclicals, such as the automotive-type industries.”

The idea for Ascend started around 2019, while McLary was still at Amazon, when he saw a need for more reliable middle-mile regional carriers. McLary, along with several other former executives from UPS and FedEx, put together an investment thesis for Ascend.

“I ran Amazon’s middle-mile truckload brokerage business and also a backhaul sales team in the middle-mile technology group,” McLary said. “What I saw is that carriers weren’t able to keep up with the needs of shippers.”

E-commerce has increased the velocity of freight movement into distribution centers where shippers are having to fit product movements into tight windows, relying on regional carriers, according to McLary.

Consumers spent a record $855 billion online in 2021, an increase of 9% compared to 2020, according to software giant Adobe, which tracks online sales. Shoppers also spent more than $3 billion online in November and December.

“People were leveraging a lot of the regional carriers and just couldn’t get the service quality that they needed,” McLary said.

Ascend was formed by the merger of Jackson, Tennessee-based Milan Supply Chain Solutions and Potonoc, Mississippi-based J&B Services, a regional transportation and logistics services provider.

Milan acquired J&B in October 2018. Ascend is backed by private equity firm Wellspring Capital Management Group.

“We went out on the path to acquire companies and we made our first acquisition back in October 2019, then boom, the COVID-19 pandemic happened,” McLary said. “Since then, we’ve been moving at a little bit more of a faster pace, and you’ll continue to see us make acquisitions in very strategic areas.”

Along with acquiring regional truckload carriers and improving their service, Ascend also has a truckload brokerage services unit, complementing the company’s asset operations by providing dry van capacity and specialized options such as temperature-controlled and flatbed vehicles.

Ascend’s business plan also includes leveraging technology to build a driver relay system that allows truckers to get home when they want.

Ascend drivers can earn up to 64 cents per mile starting pay based on experience, with average salaries ranging from $71,000 to $82,000 annually. Ascend also trains new drivers, with a two-day orientation where they are paid up to $1,000, according to the company’s website.

“In 2019, we also had a driver shortage issue, and it’s only been exacerbated since then,” McLary said. “We developed proprietary optimization tools into our TMS. We’re running more and more relays, which drivers love. You can mimic OTR without putting a driver on the road for five days.” 

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Source: https://www.freightwaves.com/news
Editor: Noi Mahoney