Dive Brief:

• Freight forwarder Expeditors International has acquired Fleet Logistics' digital-forwarding platform for an undisclosed sum, according to a press release. 
• The platform will be integrated into Expeditors' existing LTL platform Koho, which the Washington-based forwarder launched in 2019, aiming to better serve small shippers. Fleet Logistics founder Max Lock will lead the Koho team, according to his LinkedIn post. Lock founded Fleet Logistics in 2015 in the first wave of startup, stand-alone booking platforms for freight, with funding from Luftansa Cargo along the way.
• The acquisition follows an eight-month pilot between the two companies. "Through our Koho pilot, working closely with Fleet, we were able to demonstrate our ability to meet an unmet need. Koho is the first idea to successfully navigate all stages of our innovation framework — from seed through to scale — and represents the culmination of our efforts to create our innovation team and framework," Expeditors Chief Strategy Officer Benjamin Clark said​ in a statement.

Dive Insight:

When Expeditors launched the Koho platform it was, like many brokers and forwarders, looking to expand its digital capabilities.

Digital booking platforms streamline the amount of labor required to service smaller shippers, along with, in theory, improving the booking experience for digitally inclined customers. Expeditors created a new EVP for Digital Solutions position last week, appointing company veteran Jose Ubeda (who joined Expeditors as a messenger in its founding year 1984) to the position, and has now acquired a leader for Koho.

Leading forwarders like Expeditors, who acknowledge the need for a shipper-friendly digital platform, have the option to build or buy the technological capability. Expeditors has traditionally had an in-sourced mindset, when it comes to technology.

"As a knowledge-based global provider of logistics services, we have often concluded over the course of our history that it is better to grow organically rather than by acquisition," reads the company's 2019 annual report. "Nevertheless, despite our history of organic growth, we are not opposed to acquisitions and we will continue to identify and assess potential acquisitions." Obtaining technology is one reason the company might choose to buy instead of build, according to the report.

Acquisition is, so far, a less-common way traditional brokerage and forwarding players are boosting their digital capabilities, but that may change as digital transformation becomes a competitive necessity.

C.H. Robinson, which has taken the "build it" route through digital transformation, reported technology development has created a "favorable spread" between truckload and headcount growth.

"Simply put, we're doing more with less in the field today and this is due to the output of our technology investments and the work that our teams have been doing to standardize, centralize and automate the core processes within our business," said CEO Bob Biesterfeld, noting improvement in truckoad and LTL metrics.