News / Flexport is 'back on track' – now it needs to start growing again

Flexport is “really back on track” with its restructuring, while its cost base is “where it needs to be”, according to board advisor Neel Jones Shah.

Acknowledging the two “pretty significant rounds of layoffs” in the past six months, Mr Jones Shah – who is also leaving the company this summer for a new role – explained.

“There is still work to be done. But the bulk of that work we have been able to accomplish, and really influence the P&L in a very significant and positive way.

“I feel the company is now really back on track.”

Flexport – in line with some other forwarders – has also made changes to the way it handles customers.

“One of the decisions we made as an executive team was to geographically collapse our global key accounts into their respective geographies. Having the infrastructure to serve this subset of customers was getting to be a bit unmanageable, from a cost standpoint. It made sense to go back to more of a regional focus when it came to how we serve these customers,” Mr Jones Shah, who has been chief customer officer, explained to The Loadstar on the sidelines of the CNS Partnership event in Dallas.

“Significant progress has been made. I can’t divulge exact numbers, but the turnaround has been very significant.”

He added that there had been a “reallocation of headcount” to help build the company’s geographic footprint, with investment in staff in areas such as South-east Asia.

“Now Flexport has to get back to blocking, tackling and growing, just running a tight business. And if you can do that well, you’ll be successful.

“And then we really have to start growing again. When you go back to the origins of Flexport, it was hyper-growth, we were growing like crazy. It doesn’t have to be at that pace, but we have to start growing again.”

Mr Jones Shah, said new members on the executive team were leading the charge in the leaner organisation, and “I think they’re up for the challenge”, he said.

He revealed that Flexport had a “lot of products coming to market in the next weeks and months, that are going be a really impactful to Flexport’s future”.

He continued: “We have to go back to putting strong value propositions in front of customers, selling them multiple products.”

Mr Jones Shah pointed to Flexport’s Customs product in particular.

“We have an exceptional Customs product, it’s the best in the business. Once our customers experience it, they really start to see the value in it. And we have to get back to selling a customer on multiple opportunities to interact with Flexport. It’s not just about buying airport-to-door, ocean or air. You’ve got to do more. You’ve got to spread yourself wider. And we have the tools to do that.”

Flexport’s Customs product, he said, was “probably the lowest cost to serve, which is super important when you are talking about Customs at scale. Our technology, I believe, is unique. That allows us to move faster than the average.”

The market dynamics, he added, had changed, with customers shipping less, while e-commerce has been on the rise. And Flexport has invested in its technology.

Meanwhile, Mr Jones Shah, who would not be drawn on his new role, except to say it was something he was “passionate” about, added: “We want to do a really thorough and proper transition. It’s very important, given all the contacts and pieces of the business I have managed over the past seven and a half years.

“As a fairly significant shareholder in Flexport, I have only Flexport’s best interest in mind. But Flexport’s future will not be written by me. It’s exciting to move on, and I’m excited about my future – and about Flexport’s.”