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FedEx Freight Launching New CRM to Chase Market Share Goals
Carrier Takes Aim and Small-to-Medium-Sized Businesses
Key Takeaways:
- FedEx Freight will deploy a new CRM by its June 1 spinoff as it becomes a stand-alone LTL carrier, executives said April 14.
- The platform centralizes sales and pricing to target under-penetrated verticals and SMBs, supporting a 500-plus sales force and aiming to cut manual invoice touches 60%.
- The company plans pricing tools, AI upgrades and cost cuts while listing shares as FDXF on the NYSE and exiting transition service agreements.
FedEx Freight plans to employ a new customer relationship management system to pursue its goals for gaining market share in under-penetrated verticals after the less-than-truckload carrier becomes a stand-alone entity.
The Memphis, Tenn.-based carrier’s CRM will be ready for its planned June 1 spinoff from FedEx Corp., a spokesman said April 14.
“The launch of our fit-for-LTL CRM will ensure all sales, service, marketing and pricing touch points are aggregated on one platform. As a result, lead prioritization and wallet share opportunities are front and center, easily accessible by our sales team, driving improved selling performance,” Chief Technology Officer Mike Rodgers told analysts and investors at FedEx Freight’s first investor day on April 8.
FedEx Freight has built a sales force of more than 500 employees. Executives told analysts that the stand-alone entity would be chasing market share in small- to medium-sized businesses, plus the grocery, health care, data center and energy sectors. FedEx Freight’s current customer base is led by three verticals: industrial (30%), transportation and logistics (15%) and consumer goods (14%).
The LTL-focused sales team and technology upgrades are a central part of the new strategy. Bank of America analyst Ken Hoexter highlighted in an April 9 research note that this change marked a structural shift for the carrier from a bundled offering. Sales team members are also set to be located in and around service centers, with the aim of solving issues more speedily and fostering stronger customer relationships.
“Our understanding is that prior to its decision to spin, [FedEx] was pursuing a more consolidated sales effort, combining ground, express and LTL; the latter being arguably the most ‘difficult’ to sell, it was often overlooked, with sales representatives hitting their targets with the more simpler offerings,” noted Deutsche Bank analyst Richa Harnain in an April 11 research note.
FedEx Freight, already ranked No. 1 on the Transport Topics list of the largest less-than-truckload carriers in North America, also plans to launch new pricing and rating tools as it seeks a 60% reduction in manual invoice touch points.
Alongside launching new tools, the carrier is cutting its application footprint by 20% and exiting transition service agreements as quickly as possible to reduce costs, it said.
Some legacy applications will remain, but the company plans to rapidly update existing software with artificial intelligence capabilities.
“First, we’ll take advantage of native AI capabilities already present in the modern platforms,” Rodgers said. “Second, we’re going to strategically deploy custom AI solutions to improve our logistics capabilities. Third, we’ll employ AI agents to refactor legacy applications as we continue to monetize the estate. And lastly, AI will allow us to rapidly develop differentiated capabilities.”
The technology initiatives will be most beneficial to FedEx Freight when targeting the $9 billion small- to medium-size business sector of the LTL market, said the carrier’s incoming President and CEO John Smith.
“The key is the technology that we’re building. That’s where we are at a disadvantage in my opinion, but will not be on 6/1. We’ll have that built. And that’s what [is] going to allow us to go and get back even some of the small and mediums — because of those pain points that we have not fixed over the last previous year,” he said.
FedEx Freight’s common stock is set to be listed on the New York Stock Exchange under the ticker FDXF.
Currently, the company has 365 locations, around 26,000 service center doors and about 30,000 vehicles, including 17,000 trailers.
FedEx Freight entered the LTL space in 1998 with the acquisition of Viking Freight, expanded its regional network in 2001 with the purchase of American Freightways and added longhaul capability in 2006 by taking over Watkins Motor Lines.
FedEx Corp. ranks No. 2 on TT’s Top 100 list of the largest for-hire carriers in North America.
