But we’re — we’ve got 1,100 agents or so that we’re trying to introduce into heavy haul and in the cross-border. They’re not all going to want to do it, but there are going to be some who have one of the opportunity to try that business out. We know there’s a bunch of freight out there. We know we’re good at it. We know our safety and our service capabilities and the performance that we put up year in, year out. Just to give a lot of credit to Joe in terms of the way that he’s running the operation. It’s important for us to keep those as great selling points. And it takes a couple of people extra in order to really go out and sit with the agents and help them understand how to go out and sell that piece of business. Joe, anything you add to that?
Joe Beacom: Yes. And Stephanie, we’ve kind of got a mantra that we attribute to cross-border and that is Mexico made simple. And I think that over the years, we’ve really worked to make it that way so that agents aren’t intimidated or aren’t at all reluctant to bring it up with the customer. We’ve got over 500 agents of our 1,100 that will do a cross-border shipments last year and going forward. And so what we’re trying to do is just deepen the understanding, increase the confidence to do so. And from an investment standpoint, we continue to put shuttle trailers down there that allow us and our Mexican carrier partners to utilize those trailers and provide seamless service, a timely service across all the gateways. So we’re just trying to do a lot of things.
The sales effort — on the interior, not every agent wants to go into the interior and make sales calls. So Landstar provides resources that will be embedded in the interior, making calls, uncovering opportunities that will then be managed by those agents and our teams at the border. So I think it’s a good recipe looking forward.
Stephanie Moore: Thank you. Appreciate the answer. And then just one follow-up here. Maybe on the technology side, I think for years, a lot of the technology investments were geared towards upgrading some legacy systems. Are we at the point now where maybe some of these investments are positioning you guys to play a little bit more offense?
Frank Lonegro: Internally, Stephanie, we sometimes say, we were the original tech-enabled logistics provider. So we’re going to continue to stay on the leading edge of that. I think we have to. It’s really table stakes these days. So we may not have marketed nearly as much to the investment community as others have done, but we think it’s not a single legged stool, right? It’s not just technology, it’s the brand, it’s the scale, it’s the relationships, it’s the safety, it’s the security. It’s all of those things wrapped up into one. It’s not just a bunch of people sitting in front of a computer trying to do business in a digital manner. That is clearly something that we do, but it’s not the only thing that we do. One of the things that we will start looking at is technology, I’ll say, inside the building, where we still do some things that are more legacy-related inside the building.
Call center modernization would be an idea there that we’re talking about in the billing and settlement area for us inside the building. So we’ve got some things that are going to generate, I’d say, better levels of support, maybe some efficiencies over the next couple of years. I think we’ve done a lot, and I give Jim Gattoni, a ton of credit. One of the hallmarks of his tenure has been putting great technology and tools in front of the agents and the BCOs. And I think we’re sort of coming to more of a maintenance mode for that over the next couple of years. And again, we’ll start to reinvest inside the building.
Stephanie Moore: Thank you. Really appreciate it.
Frank Lonegro: You bet, Stephanie.
Operator: Thank you. We will move now to the next question coming from the line of Daniel Imbro, Stephens Incorporated. Your line is now open.
Joe Enderlin: Hi, guys. This is Joe Enderlin on for Daniel. Thank for taking the question. Just wanted to ask about the cadence of variable contribution margin. Could you maybe talk about how the exit rate compared to the beginning of the quarter? And then where have you seen that trend during April?
James Todd: Yes. So we put out, Joe, a BCM guide for the first quarter of 14.5% to 14.7%. And clearly, with the revenue to be a little bit more brokerage in there and spreads compressing on us a little bit more than we would have anticipated. Missed at low end by 13 bps or so. As we move into the second quarter, would that call for sequential load volume, that’s going to be handled via third-party trucks, right, given what we’re seeing in truck count. So you’ve got kind of embedded mix headwind. And then we did bake in a little bit more anticipation of spread compression similar to what we saw third quarter to fourth quarter, fourth quarter to first quarter. And as such, the guide calls for a very, very close to normal seasonality with respect to BCM expectations for 2Q.
Joe Enderlin: Got it. Makes sense. Thank you. As a follow-up, it sounds like you guys are seeing an improvement in industrial end markets and commodity groups. Do you have any thoughts on when you expect consumer durables demand could pick up? Or have you seen any green shoots of improvement there?
Frank Lonegro: Yes, it’s a good question. I mean it is getting a little bit better, but it’s off of an awfully low base. So I’d hate to call the ball on that one. I think it’s going to come down to the consumer has had a lot of opportunity in the last couple of years, as COVID has kind of relented and you spent the first two years of the COVID period spending money on things at home and renovating things that — you couldn’t go out, you couldn’t travel. You couldn’t do the things that otherwise you might want to do out and about, just given the concern around contagiousness. So I think we’re now in that period where folks are pivoting towards more of the services and going out to dinner, rather than eating at home or taking a vacation instead of buying a new dishwasher or something like that. So I just think we’ve got to go through the pull forward a little bit. I still think we’re several quarters away from seeing that come back into equilibrium.
Joe Enderlin: Got it. Thank you, guys. That’s all for us.
Operator: Thank you. We will move now to the next question coming from the line of Bascome Majors of Susquehanna. Your line is now open.
