Transfix CEO Lily Shen joins Yahoo Finance Live to examine the state of the supply chain as disruptions in the transportation industry continue and how her company tries to match suppliers' labor demands to meet shipping needs.
JULIE HYMAN: Buy your stuff early. That was the message over and over going into this holiday season because of concerns about shortages of gifts going into the holidays because of what we've seen going on with supply chains. Let's get the latest insight into what is going on with those supply chains right now.
Lily Shen is the CEO and President of Transfix, it's a company that helps match up stuff with trucks to be more efficient about how the whole process works. Lily, thanks for being here. Before we sort of dig into the bigger supply chain issues, I do want to ask a sort of today question, which is, we've been covering the increasing drumbeat and spike in cases that seem to be Omicron from the early indications. Are we set for a repeat though of the supply chain issues that had been caused by earlier waves of the pandemic? What kind of early indications are you seeing?
LILY SHEN: Hi, Julie. Great to see you. I think it's really hard to predict exactly what's going to be happening obviously with the cases. So hard to say if there's going to be-- if it's going to be a repeat, if it's going to get better or if it's going to get worse. You know, but what I will say is obviously, this has affected everyone and certainly the supply chain. And obviously, with the supply chain you know, we continue to see disruption across the board.
But the truth is, Julie, that these challenges in the supply chain have actually existed for decades. Those who were you know, not familiar with those challenges certainly realize it now. And you know, a lot of that actually still, in fact, holds true. A third of truck miles continue to be driven empty every single year. And the truth is that the role of technology which has been huge across so many sectors has actually not been the case in transportation and logistics. And it speaks to the opportunity for those that are in this space today.
BRIAN SOZZI: Lily, FedEx said something interesting on their earnings call last night, that they don't see an end to these bottlenecks in the supply chain. Are you on board with that?
LILY SHEN: One thing I will say, is that in the supply chain there are constant challenges. And the truth is that there is always going to be some level of demand and supply imbalance. But Transfix's platform seeks to really help our customers, as well as carriers, manage that through any time of imbalance or any time of volatility. And obviously, we're continuing to see extreme cases of volatility.
But our platform really solves that by doing it in a number of ways. And that's really by providing a many-to-many matching platform for customers, as well as carriers who seek to work with us, who are constantly looking for access as well as reliability and capacity. And for those carriers that are also looking for access and reliability and freight. Our platform has really been built over time to be able to manage that and being able to do that not only with the technology and machine learning algorithms that we have in place but also with the people, with the industry experts, and those who have been in this space and understand and have seen a lot over the years to be able to manage that effectively for the customers that we work with.
JULIE HYMAN: So Lily, let's back up a sec, why are a third of trucks or if not a third of trucks, a third of the space within trucks to say that correctly. Why is it empty? Why is it-- why aren't trucks full all the way?
LILY SHEN: That's a great question. A number of reasons. So one, highly, highly inefficient. So the use of data and technology and the ability to match has really not existed in the past. So we understand exactly where carriers are at, where they're going and we're able to actually match that with freight that is available at any given point in time. Because the technology and systems have either been nonexistent or archaic or actually extremely siloed, no one's been able to really bring that all together. And that actually has driven a lot of the inefficiency that's in the system. So when we say a third of truck miles have been driven empty, it's because of that level of access, data, and visibility that hasn't existed in the industry. Another reason--
BRIAN SOZZI: Oh, go ahead, Julie.
LILY SHEN: The other reason that I want to mention here is that you know, people-- everyone's talking about driver shortage. And so obviously, there's a huge opportunity to drive more efficiency in the system. But one thing that continues to also come up is obviously, the number of drivers coming into the system and the ability for everyone, every player in this space to also provide better conditions for drivers as well.
BRIAN SOZZI: I imagine, Lily you have incredible pricing power in your business right now?
LILY SHEN: Well, I would say that it's our algorithms have been built in such a way that we're able to determine the right price at the right time based on challenges and based on what's working on in the overall system. So you know, we certainly take a look at where the markets are at but also look at the strength of our platform, look at the strength of the available capacity in our platform to be able to help customers and our shippers really best manage their costs.
JULIE HYMAN: Lily, thanks for being here. We're going to keep in touch because one thing we didn't mention is you're going to be going public through a SPAC deal that's going to close in the first part of next year. So we'll check back in with you at that point. Lily Shen is the CEO and President of Transfix. Thank you. Appreciate it.