Menu NEWS Transplace acquires consulting firm LeanCor Supply Chain Group September 1, 2020 Transplace adds lean manufacturing expertise, Plan For Every Part software Tuesday morning, Transplace, a leading managed transportation and logistics services provider, announced the acquisition of LeanCor Supply Chain Group, a Florence, Kentucky-based consulting firm focused on end-to-end supply chain consulting, training, solutions and lean manufacturing principles. LeanCor was founded in 2005 by Robert Martichenko, a recognized expert in lean principles, and grew to more than 100 employees. The deal was Transplace’s third this year, following the acquisitions of Lanehub and ScanData. Financial terms of the deal were not disclosed. Although the LeanCor deal was in the works before the COVID-19 pandemic hit the United States in March, like the Lanehub and ScanData acquisitions, it seems particularly well timed given the supply chain challenges facing manufacturers. Lanehub’s technology overlays shipper networks onto each other and identifies lanes where capacity can be shared and asset utilization improved, allowing shippers to combine their buying power on dedicated lanes. ScanData allows Transplace to automate parcel optimization and give customers visibility and additional modal flexibility. At a moment in the truckload cycle when elevated consumer spending on goods — particularly through e-commerce — has spiked parcel volumes and tightened truckload capacity across the country, the acquisitions of Lanehub and ScanData seem prescient. LeanCor’s expertise in optimizing manufacturing supply chains according to lean principles and focus on inbound logistics and inventory management are also timely, welcome additions to Transplace’s service offering. “We’re living through one of the great changes in global supply chains that I’ve seen in my career, and I’ve been doing this for more than 30 years,” said Frank McGuigan, chief executive officer at Transplace. “Companies were either caught with too much inventory and were not able to shed costs fast enough, or the other side, companies were not able to scale up fast enough for unforecasted demand on their networks. Shippers have to be able to understand the levers that drive a successful supply chain all the way from consumer back to raw materials procurement and be able to react quickly.” The continuous improvement and waste reduction philosophies of lean manufacturing, ultimately derived from the Toyota way, have allowed manufacturers to reduce carried inventory, efficiently use working capital and accelerate velocity in their supply chains. But over-optimization to last year’s demand can leave companies flat-footed when consumer behavior shifts. LeanCor’s consultants understand the trade-offs between “just-in-time” and “just-in-case” and work with clients to build supply chain strategies that orchestrate movements across complex supplier networks. “In a year where not a lot of M&A is happening, LeanCor is a very good fit,” McGuigan said. He noted that all three of Transplace’s 2020 deals valued acquisition targets based on 2019 financial metrics that have materially changed. While the newly acquired companies may not make budget this year, McGuigan said that he’s had an invaluable, firsthand look at the resilience of these new business units and their ability to grow revenue year-over-year in a challenging environment. With regard to the overall M&A environment in logistics, McGuigan said that his team has seen several would-be sellers withdraw their companies from the market after adverse results in 2020. “We’ve seen a lot of books that have been pulled because the companies aren’t showing that level of resilience and they’ve decided they’re going to try to sell another day,” McGuigan said. But Transplace expects LeanCor to play an important role in helping Transplace customers adapt and thrive in exactly that climate. “Transplace continues to expand into more manufacturing-centric verticals where inventory management and visibility are important,” McGuigan said. “Having LeanCor’s expertise is critical when folks are trying to find the balance of lean principles as well as being nimble and having flexibility to respond to changing market conditions.” LeanCor’s consulting business is similar in size to Transplace’s existing supply chain consulting practice, McGuigan said, but there’s little overlap. Where Transplace has historically focused on transportation network performance and design, more of LeanCor’s work takes place within the four walls of manufacturing facilities. LeanCor’s intimacy with its customers evolves from a very deliberate process that moves from learning to teaching and eventually novel supply chain solutions. With the deal, Transplace also acquired powerful proprietary software developed by LeanCor to manage a Plan For Every Part (PFEP), a materials handling management system inspired by lean principles. In PFEP, an extensive list of data attributes for every physical part involved in manufacturing an item is collected and analyzed to find weaknesses and opportunities. Attributes like the location of the supplier, the weight and dimensions of the material, its daily and hourly usage rate in the plant, its transit time from supplier to plant, size of a standard shipment in terms of daily usage, and number of orders or “pull signals” currently in the loop are all attached to the same record. From there, software can automate the complex orchestration of a supply chain with hundreds and thousands of suppliers. “Our acquisition strategy has always been about advancing the technical and operating capabilities of the Transplace platform,” McGuigan said. “We’re really pleased to have the ability to go deeper on inventory management and manufacturing supply chain practices and provide live, granular visibility every single day.” McGuigan said Transplace has been aware of LeanCor for years, and that Transplace employees have studied at LeanCor workshops at Georgia Tech. The relationship and mutual awareness predated the deal — the determining factor was when LeanCor founder Martichenko, who still led the company, decided that the time was right to seek a partner. “Companies like LeanCor get phone calls every day,” McGuigan said, “and we’re proud that we’ve shown we can successfully bring them into a new home and place for growth. We can’t achieve our mission without acquiring more and smarter people and greater capability into our platform.” LeanCor customers will be lifted onto the Transplace platform one by one and gain access to its transportation management system and control tower, while retaining all of the functionality that they had with LeanCor’s platform. McGuigan said a cross-pollinated team of Transplace and LeanCor people will drive the software integration, which he expects to take less than one year. Article originally published by FreightWaves: https://www.freightwaves.com/news/transplace-acquires-consulting-firm-leancor-supply-chain-group Follow Us Find by Topic Media Press Releases Recent News Short-Sea Shipping: A Viable Alternative for Navigating U.S. & Mexico Capacity Challenges Navigating the Wave of Ocean Shipping Constraints Uber Freight Completes Acquisition of Transplace Checklist For Creating A Capacity Capture Plan Transplace’s Fourth Quarter 2021 Logistics Market Update Report and Webinar Transplace CEO Predicts ‘Rapid’ Logistics Consolidation Seven Tips to Handling LTL Freight Demand Transplace Shipper Symposium: Transformation And Innovation Here are the large enterprise finalists for the 2021 Dallas CIO of the Year ORBIE Awards Show more 3010 Gaylord Parkway, Ste. 200 Frisco, TX 75034 (866) 413-9266 Request Demo SOLUTIONS Logistics Technology and Solutions Cross-border Logistics Capacity Services INDUSTRIES Automotive Chemical Consumer Packaged Goods Manufacturing Oil and Gas Paper and Packaging Retail RESOURCES Case Studies Data Sheets Events and Webinars Market Updates News Transplace Blog Videos White Papers © 2021 Transplace. 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