Dunavant Expands Into China While Bolstering the Company Stateside

By Don Wade, Memphis Daily News

With a strong presence on the Gulf Coast and in the Southeast, the acquisition of a private customs brokerage company in Mobile, Alabama, made sense for Memphis-based Dunavant Global Logistics Group LLC.

But so did the opening of Dunavant International Freight Agency in Shenzhen and Hong Kong, China.

Dunavant chief operating officer Richard McDuffie said Mobile-based John M. Brining Inc., was the “right company and culture.”

Lillian C. Brining, president of J.M. Brining, said Dunavant was appealing because of its reputation for integrity, adding, “We are confident in their approach.”

As for the international expansion, Dunavant had been looking to return to China for some time.

“In our cotton-trading days, we had offices in China,” said Woodson Dunavant, vice president for marketing and development. “So this is going back to the well, so to speak.”

Once upon a time, Dunavant was the largest raw cotton trader in the world. In 2010, however, the cotton operation was sold.

These recent moves point to the company remaining aggressive. Dunavant has seven locations in major port and intermodal cities and about a dozen truck terminal sites. Dunavant Global Logistics offers supply chain and logistics management around the world, including intermodal and truck operations, warehousing and equipment leasing.

Business comes on both a short-term and long-term basis. If, for example, someone needs a one-time transport of freight from Savannah, Georgia, to Atlanta, Dunavant can do that on a transactional basis. If a company needs product stored in a Dunavant warehouse, then a long-term contractual agreement is possible.

The industry, McDuffie says, is ever-competitive and takes in a lot of territory and possibilities.

“Logistics is a broad term,” he said. “So is supply chain.”

While some on the outside might question expansion, especially into a market such as China, it’s very much a calculated move.

“No doubt, the global economy has had some downside pressure on it,” McDuffie said. “But from the standpoint of expansion, we continue to grow our business organically. We’re picking up competitive market share. China, their economy is not growing as fast as it was, but it’s still growing. And we’re not just coming over for China. We move a lot of product in and out of other Asian countries.”

Over the last 15 years, the industry has seen both increased regulation – especially in trucking – and rising insurance costs.

Naturally, the price of doing business is always uppermost in clients’ minds. But it is not the only factor.

“We’re not a 5,000-employee operation,” said Dunavant. “We’re small, nimble, quick. Obviously, we’ve got to be market-competitive. But we definitely have clients willing to pay X percent more because of service they demand and we provide.”

Having worked on the shipping side of the industry, McDuffie knows that doesn’t mean customers will pay 10 or 15 percent more. It means they will pay 1 percent, 2 percent more – maybe – if they believe the value is there.

“The margin of error in our business is very small,” he said.

Further expansion is always a possibility and this expansion was a way to enhance convenience in many respects.

“We are not only expanding services and space,” McDuffie said, “but we are increasing efficiency for our international clientele.”

Meanwhile, McDuffie calls being headquartered in Memphis a “competitive advantage.” Memphis is No. 2, behind Chicago, in moving freight, Dunavant said, and in some cases is preferred over Chicago, where it can take a full day just to move freight from one side to the other because of traffic congestion.

Memphis offers an alternative. Which is also what Dunavant tries to do across all its platforms.

“How you differentiate yourself,” McDuffie said, “is providing solutions to customers.”