Global logistics providers have had to prove how creative and flexible they could be through the course of the current pandemic. According to one trailer leasing provider, truck trailer leasing has ramped up to keep inventory moving due to the surge in e-commerce, and mobile warehouse storage is in high demand as inventory stockpiles have grown in the COVID-19 era.
Milestone Equipment Holdings, a national trailer leasing company, has managed the company’s national infrastructure to make trailers available where they are needed to keep inventory moving. In addition, Milestone is upcycling aging trailers and turning them into mobile storage units.
Chuck Cannata, executive vice president, general manager of the Highway Division at Milestone, has been in the commercial equipment finance and management business for the last 25 years. Over the last several years—mainly since the rise of e-commerce—Milestone has seen an uptick in trailer demand.
“When consumers order something online, they expect it today or tomorrow. To do that, shipping companies need to build out channels to tighten the delivery window, and to do that they need more trailers,” Cannata explained.
To keep inventory moving, Milestone, which serves private fleets, for-hire carriers, shippers, and 3PLs expanded its branch location count to 29 across the U.S. Milestone also manages the full lifecycle application of a trailer.
The company’s fleet today comprises a distribution of brand new 2021 trailers all the way to vintages—trailers that are typically 10-plus years old—that would be more likely used for its Mobile Warehouse and Storage (MW&S) solution.
“This flexibility is important for our customers,” Cannata said. “If you called me today and said, ‘I will need five trailers to go from L.A. to New York City every week,’ the asset vintage best suited for that long haul will be less than 10 years old. But for a trailer moving from New York City to Connecticut, we will get you a more cost-effective vintage solution for the shorter run. Milestone is able to accommodate long-haul needs and give customers value-based options to save money on shorter distance hauls and storage applications.”
“As long as it’s not damaged beyond repair, some companies get 15-20 years of use out of a trailer, depending on the application,” he added. “However, Milestone never sacrifices functionality for age. The trailer will be perfectly suited to the application it is being used for. The trailer will be wind and watertight and safe. We are best in class at providing a viable, cost-effective option to our customers throughout the full life cycle of a trailer.”
In situations like COVID-19, where there has been an economic slowdown, inventories that were ordered months ahead of time are backing up.
“What we are seeing is a fair amount of steady demand for MW&S trailers to accommodate some of this backlog,” Cannata explained. “That’s in addition to the surge of demand that we’re seeing from dry goods shippers who are trying to keep items like toilet paper on the shelves.”
Sarah Johnson, senior vice president of MW&S at Milestone, has been with the company for roughly 20 years and took the charge in 2018 of building out the MW&S program.
“The idea of using a trailer for storage has existed for a very long time,” explained Johnson. “But the shift in retail to e-commerce really led to the growth of the storage market, as malls are sitting empty and inventory is sitting in warehouses.”
Right now, retailers and manufacturers have an increased need for equipment to store their excess inventory, she said. One example is there is a lot of furniture from retailers who have product coming in, but their stores are closed.
One Milestone customer, who typically provides temporary furniture for trade show booths and offices, has pivoted its business model to support temporary hospitals that have popped up across the country over the course of the pandemic. That customer is also reallocating its inventory of furniture to different markets and storing it in Milestone’s mobile storage units.
“COVID-19 has really upset the supply chain, there’s no question,” explained Johnson. “There is the imbalance of China being offline in terms of manufacturing and then China ramping back up at a time when we’re shut down. That imbalance has really created a disturbance in the supply chain. We are working with our customers and trying to be supportive of them in this time.”