"“Salt of the Earth:” Arkansas Best Freight, River Valley Capitalism, and Making the LTL Industry "

This paper explores a previously untouched yet critical industry in creating the modern, de-regulated supply chain: less-than-truckload (LTL) shipping. While not as large or profitable as their full-truckload counterparts like JB Hunt and Schneider, LTL carriers connect small businesses that cannot afford palletized cargo to the national economy. Their importance in rural economies, through their role as the chief logistic partner to local producers and stores, is difficult to overstate. Many LTL firms began in rural communities or America’s various small cities. As the industry grew more profitable, carriers positioned themselves as community welfare champions and union employers. Epitomizing this tension between national industry and local champions is the dean of America’s LTL carriers, ABF Freight System, formerly Arkansas Best Freight.
Building on the work of Lichtenstein, Hamilton, Moreton, Levinson, and Merck investigating the origins of the “Wal-Mart” economy, this paper focuses on the technological and labor dynamics that allowed Arkansas Best Freight to grow and profit within the LTL trucking industry before deregulation in the late 1970s. It highlights how ABF adopted new technologies, such as an employee stock ownership plan to pacify labor, computer science modeling as a means to control costs, and inventive financing such as leveraged buyouts to expand its market share within the tightly regulated LTL trucking industry.
Fitting within this year’s theme of “business in the public interest,” ABF has viewed itself as an “Arkansas” entity since its founding in 1923. Alongside the technological innovations adopted by the firm, this paper explores how ABF’s management described the firm in terms of ruralness and viewed this as an asset, how this conception defined the firm’s investment in the local community, and finally, the economic limitations imposed on ABF’s operations to retain its identity as an “Arkansas” firm.