Transportation totality: Green Bay region emerging as transportation logistics cluster
By Ben Rodgers
GREEN BAY – Football and toilet paper are two things that come to mind when people ask about the fabric of Green Bay, but transportation logistics has had an identity here for decades, and it continues to grow.
“It’s based on our strength in manufacturing,” said Kelly Armstrong, vice president of economic development for the Greater Green Bay Chamber. “Manufacturing is 25 percent of the regional economy. We got really good at making things, so we had to get really good at taking those things to market.”
The Greater Green Bay region (12 counties in total) is now considered a cluster for transportation logistics, a geographic concentration of interconnected businesses, suppliers and associated institutions, she said.
Armstrong said transportation logistics is the No. 1 growing industry in the region, employing 11,000 people, or 1 percent of all jobs in the nation, with 642 companies located here.
That’s high enough for the 18th largest concentration of transportation logistics jobs in the nation.
“We’re talking about a large chunk of knowledge-based jobs,” she said. “Truck drivers are key and important to the industry, but out of the 11,000 jobs, you’re primarily looking at headquarters and support jobs.”
The modernization of transportation logistics means more jobs in a growing field and more than just loading or driving a truck.
“The industry itself is under a huge transformation from a technology and innovation standpoint, in a lot of different ways,” Armstrong said. “That is also driving people coming out of the industry and providing technical solutions to the industry and being able to capitalize on that.”
Armstrong broke it down into three waves of businesses.
The first wave is the established companies who have been in business for decades, those include companies like Schneider and Paper Transport Inc., both headquartered here.
From there, other companies see the industry is viable in the region and start to set up shop, creating the second wave. Some of those companies include KBX Logistics and Breakthrough Fuel.
The third wave contains innovators and entrepreneurs and pushes the industry ahead.
“What could become for Greater Green Bay is that we become the known hub of innovation for the industry,” Armstrong said. “If you’re going to start a business, or develop a new technology, this is the place you come because this is where it starts.”
Basement startups riding the third wave
One person doing just that is Mark Hackl, CEO and founder of Lanehub.
Just as Stubhub is a popular place online to buy and sell tickets for sporting events and concerts, Lanehub is a place for companies to overlay transportation networks and identify synergies to save costs on trucking.
“Most companies buy trucking services by themselves,” Hackl said. “What we allow companies to do on our social community – a collaborative transportation network – we allow companies to come in and work together, to partner up. It’s like friending, but we call it partnering, and when they partner up on the software, they’re overlaying their networks.”
Say there is a company in Chicago that regularly ships goods to Atlanta. Because the Chicago company wants to utilize those transportation services it already paid for to the fullest extent, it can find a partner on Lanehub to make sure the trucks come back full instead of empty.
Hackl said the end result is a lower cost due to more efficiency, which allows for more product to be transported. Both companies win.
“Lanehub allows them to come together, and say ‘let’s partner,’” Hackl said. “Partnering means let’s unlock the visibility to where we might have efficiencies we can gain by combining our freight networks.”
His company started four years ago and launched online three years ago this September.
Before that, the Seymour High School Class of 1985 and St. Norbert College graduate worked a variety of jobs.
“I spent about 25 years in the industry, and I did some of this at prior companies I worked with, not like this with an automated software, but manually sharing data with spreadsheets,” Hackl said. “This was before everybody accepted cloud-based technology. I saw success and I asked myself, ‘Why don’t more companies do this?’ And I think companies have attempted it, but it’s always been a cumbersome, manual effort with spreadsheets and sharing data. By creating Lanehub, we’ve made it much easier for companies to collaborate and share data.”
Lanehub is still in growth mode, but works with major companies like Procter & Gamble, Anheuser-Busch, Unilever and others.
But four years ago, before Hackl started Lanehub, the venture capital and startup landscape was vastly different here.
He worked from his basement and without a paycheck for nine months.
A helping hand
One of Lanehub’s initial investors has had a finger in the transportation logistics pie of Green Bay for years.
“We worked with people who wanted to start a business,” said Craig Dickman, an early member of the investment group called N.E.W. Venture Foundry. “We would assign them a mentor out of the group. Whoever their mentor was would help them in the market, and we would help raise the seed money to get them started.”
Dickman now serves as managing partner of TitletownTech, a venture capital fund in Green Bay backed by Microsoft and the Green Bay Packers, with resources he called “unprecedented.”
Prior to that, he served as president and CEO of Paper Transport Inc., worked as a vice president at Schneider National and founded Breakthrough Fuel.
“What comes next is thought leadership, because we have all of that talent, experience, resources and technology,” he said. “So then, what becomes is thought leadership, and then you start anticipating and looking forward at what are some of the problems that exist that are too big for one company to solve.”
TitletownTech builds, enables and invests in early-stage and existing businesses.
It identifies solutions, develops startups and funds entrepreneurs across five key verticals, or areas of emphasis, which include: sports, media and entertainment; digital health; agriculture, water and the environment; advanced manufacturing; and Dickman’s specialty, supply chain management.
“There’s some good, creative things happening in this market still in stealth mode,” he said. “That creates some good opportunity on the supply chain side of things.”
Before Dickman got involved in venture funds and building the business of others, he built one himself that now rides on the second wave of the transportation logistics cluster.
Following the leaders
Dickman founded Breakthrough Fuel in 2004.
“Roughly 25 percent of the cost of moving product is the energy and what happened before was there was no way to bring transparency to what the cost was of the movement,” he said.
Breakthrough developed a platform that allows its customers to see the transparent cost of transportation in a way that no one else had done before.
“We built an exceptional team able to build expertise in energy as it applied to the movement of things,” he said. “Then we had a number of companies, industry-leading, large companies who are involved in the movement of things that use the Breakthrough platform.”
The platform is used in more than 40 countries, across North America and Europe and on all six continents.
Another local company that started in response to a need is KBX Logistics, formerly an arm of Georgia Pacific, which broke off into a separate entity in 2015.
Koch Industries bought Georgia Pacific in 2005, and a decade later an independent Koch company was formed.
KBX Logistics has over $1 billion of freight spent in domestic transportation, making it the sixth largest third-party logistics (3PL) company in the United States, focusing on businesses under the Koch Industries umbrella.
“In 2018, we grew by over 100 employees,” said Brian Figueroa, regional transportation manager for KBX. “We were around 200 at the start of 2018 and eclipsed 300 at the end of last year, and are now looking to expand further and are actively hiring, not only in your typical transpositional roles, but a lot in technology in various different forms and 3PL and supply chain functions.”
A 3PL, like KBX, is a business that provides transportation logistics or distribution services to companies that don’t have those capabilities and choose to outsource them.
“Companies truly in transportation logistics, companies like ourselves in 3PL, are innovative looking at supply chain and logistical solutions, driven by technology and innovation,” Figueroa said.
The big players at the table
Firmly secure on the first wave of companies that helped make the region the hotbed it is today is Schneider.
Schneider is rated as the 16th largest logistics company in America in 2019, according to Transport Topics, a logistics and trucking industry news source.
Transport Topics said Schneider had an estimated net revenue of $1.18 billion, and transportation logistics as a whole is an $800 billion industry.
If market presence is any indicator of growth in the region, all signs are pointing up as 15 of the top 50 logistics companies have some sort of presence in the region, according to Transport Topics.
The company doesn’t plan to slow down either.
Currently, Schneider has 20 open driver positions and 39 open office positions locally, which mirrors the region as a whole.
Jobs all around
Back at the Chamber, Armstrong said the transportation logistics industry is hiring people with an education ranging from a high school diploma to a PhD.
In 2017, the University of Wisconsin-Green Bay placed 41 graduates across 20 different fields of study into the transportation logistics industry, with a higher number now more likely.
In total, Armstrong counted 34 specific job titles in the industry in the area that have openings.
“A lot of these companies are developing or using their own systems,” she said. “Meaning they have their own department that’s creating whatever platform they’re using to run their business on.”
Office jobs across in the industry range from account managers, to logistics coordinators, to server analysts, to data scientists, to only name a few.
When people call Green Bay a toilet paper town, Armstrong takes note as it has evolved far beyond that.
“That is certainly a perception problem we have,” she said. “We are certainly proud of our paper and pulp products, but I would say what people internally don’t see is how much technology there is, how automated that is and how much of a technology company Georgia Pacific is these days.”
Yes, Green Bay makes toilet paper for the country, but what has come from that has bloomed into a burgeoning, multifaceted industry that is seeing growth, startups and hiring all types of people.
“It’s not just toilet paper,” Armstrong said. “It’s the technology behind the toilet paper.”
Tips from the professionals
Have a big idea? Want to disrupt an industry and make waves? Now is arguably one of the best times for startups in the history of Green Bay.
But with the possibility of a big reward comes a big risk, and any moves should be well-thought out.
The Press Times asked two people with experience in getting companies off the ground for their best advice for entrepreneurs.
“Have confidence to pursue the idea, because we are thought leaders in this marketplace and if we are building on what we know, there is a good chance it can be impactful,” said Craig Dickman, manager partner of TitletownTech. “Second, take time to think through where and create value. What problem are you going to solve? In trying to solve the problem, how are you creating value?”
After the solution to a problem is identified and value created from it, ask around and get opinions.
“Find some people you trust in the industry,” Dickman said. “Go out and get feedback and listen to the market, because the market will ultimately determine if somebody will buy something or not.”
Mark Hackl is the CEO and founder of Lanehub, a social network for trucking companies.
He started with an idea and now has investors approaching him, instead of the other way around.
“You have to have a curious mind,” Hackl said. “You have to be thinking about new ways to do things, innovation. Not everybody has a curious mind and that’s key.”
Hackl worked in the area for 25 years and in the transportation logistics community for many of them. That’s part of his next tip.
“You have to accumulate enough knowledge, industry knowledge, about the subject you’re going to go start up,” he said. “A lot have ideas, but not knowledge.”
Finally, he said people need to hang in there.
“What sounds exciting quickly turns into what’s your stamina? What’s your persistence?” Hackl said. “You have to have some grit and some persistence to be able to stick with it. Unlike any other job you’ve had before, you’re going to hit highs and lows, peaks and valleys, and you have to have what it takes to stick with it, and that’s probably one of the hardest things.”