Tom Nightingale is the CEO of AFS, a nonasset-based third-party logistics company (3PL) serving more than 1,800 companies in more than 35 countries. Nightingale has long been active in the industry, including a recent stint as chairman of the board for the Council of Supply Chain Management Professionals (CSCMP). Prior to joining AFS, he served as president and CEO of International Package Shipping and its operating companies, and held senior leadership roles at Genco (now FedEx Supply Chain), ModusLink, Con-way Inc. (now XPO), and Schneider National.
Nightingale, who has an MBA from Syracuse University and a bachelor’s in marketing/management from Siena College, serves on Syracuse University’s Franklin Supply Chain Management Advisory Board as well as the boards and advisory boards of several other organizations, including Convoy, WattEV, and Oakes & Terry. He has also served on the boards of SimpliShip, MP Objects, NextShift Robotics, the Warehousing Education and Research Council (WERC), and Women In Trucking. Nightingale lives in Atlanta and enjoys spending time with his wife and three daughters.
Q: What is the current state of our supply chains?
A: Supply chains are still in the late stages of recovery following the shock of the pandemic. Inventory has returned to more rational levels, transportation has begun to normalize, and warehousing rates and space have come back into tolerance. The sole remaining outliers are labor availability and costs, which remain challenges.
Q: Transportation markets had a rough 2023. What will it take to achieve a sense of normalcy in the logistics industry?
A: 2023 was a tough year for asset-based carriers in the ocean, truckload, parcel, and LTL sectors—in that order. Having said that, it was “tough” when compared to the anomalously high pricing levels that were a function of the pandemic. However, if you were a shipper or 3PL that earns its living through a gainshare model, it was a great market. What made it “great” for us was our ability to find better carriers at better prices.
A sense of normalcy requires time as the pandemic-driven disruption fades further into the distance and various economic aftershocks subside. Sadly, unless demand rebounds dramatically, it will take a substantial number of exits (read bankruptcies) to bring pricing back in balance for carriers.
Q: As a nonasset-based 3PL, AFS offers a wide range of logistics and brokerage services. What do you feel is the main value that you offer clients?
A: AFS is unique in that we are nonasset-based and nonasset-biased. We further differentiate ourselves in the value that we offer to clients because we align our interests with our clients. What I mean by this is that because our pricing is predominantly gainshare based, we fight harder for every dollar that we can save our clients because we also get a portion of that dollar saved. When you combine that ethos with our core competencies of parcel, LTL, freight audit, and transportation management, we bring a unique combination of services with a unique pricing model backed by a 42-year history.
Q: Does the shortage of available labor give 3PLs an advantage in that companies might outsource functions for which they lack internal resources?
A: The current labor shortage is definitely helping 3PLs. When you combine a tight labor market with a historically underinvested tech stack and a fragmented carrier community, being a world-class shipper is exceptionally hard to do alone. It has been said, “If you want to go fast, go alone. If you want to go far, hire a great 3PL.”
Q: You partner with TD Cowen to produce the quarterly “TD Cowen/AFS Freight Index,” which provides timely information about the market. Why is this collaboration a priority for AFS?
A: The “TD Cowen/AFS Freight Index” is unique in that the index covers more modes than others do—not only truckload, but also parcel and LTL. And by leveraging our $39B of freight visibility with AI and machine learning, we produce a predictive index. Every other index is purely rearward looking and dominated by truckload. Our customers have really come to rely on the data and look forward to its release each quarter.
Q: You’ve been in the transportation and 3PL industries a long time. What are the most significant changes you have seen?
A: The widespread dispersion and adoption of technology at ever-improving prices has been both the biggest and the best change. When I started my career, barcodes were omnipotent. Now, as you look at AI, machine learning, IoT, mobile computing, control towers, and business intelligence, the technologies that were once reserved for the upper-echelon companies I was fortunate to start my career with are now within reach of every carrier and 3PL.
Q: You’ve been very involved in industry groups, including CSCMP and WERC. Why is this important to you?
A: This is a tight-knit industry that always gives back more than you give to it. So, when I have been fortunate to chair the boards of CSCMP and WERC, I have always received more than I put into these fine organizations. What I mean by that is through my small contributions to a network of great people solving complex industry problems, I have the greatest Rolodex of people who are smarter than I am and who have probably faced any challenge I would face. Tapping into that network makes me a more effective leader.
