ArcBest Corporation (NASDAQ:ARCB) Q4 2022 Earnings Call Transcript

Dennis Anderson: Yes, thanks, Bruce. This is Dennis. I would say that we look at our customers holistically. And so, we think about what their supply chain needs are. We’re not typically going in and prescribing a specific service for them until we understand their needs. And so, as we learn about their needs, and their needs shift, and so we get into these conversations about what’s going on in their supply chain today, and what might be happening tomorrow, and understanding their pain points. And so, that that becomes — then, once we identify the need, then we step into the process of understanding what solution needs to be built and how those need to be priced. And so, I’ll turn it over to Danny in case he has any other —

Danny Loe: Yes, just to follow up on what Dennis said. When we think about the supply chain you think about supply chain optimization. Really, the — what we’re seeing in that is, if we had the right conversations we could eliminate cost from the supply chain, which takes pressure off of price. And so, there’s not a need at that point to kind of — kind of, I think, you described. We were able to lower the overall by taking inefficiencies out of supply chain. And so, customers are excited, and that allows us to have the margin that we need on our business there.

Dennis Anderson: Yes. To add to that, Danny, it’s an order of magnitude different; having a rate conversation for cost reduction for a customer versus changing the way that their supply chain works, and so, if you’re able to optimize how their — the frequency and the distribution points that they’re shipping product, that that is a significantly different cost savings conversation than a rate conversation.

Bruce Chan: Okay, no, that’s helpful color. And I guess maybe just to clarify and put it simply, as your business is growing and as your service lines are growing, are you now managing or optimizing more towards an all-in kind of fully baked price for customers?

Danny Loe: Bruce, I would say that kind of as Dennis described, we’re having an overall conversation. There’s still individual pricing components underneath the structure, but those vary depending on what the solution is to it. And so, yes, we think overall, holistically with the customer. But then it still drives down to individual components after that.

Bruce Chan: Got it, very clear. Thank you.

David Cobb: Thank you.

David Humphrey: Okay. Well, I think that concludes our call. We appreciate everybody been with us this morning. We ask you to disconnect now. Thank you very much.

Operator: That does conclude the conference call for today. We thank you for your participation, and ask that you please disconnect your line. Have a great day, everyone.