FedEx Trade Networks’ local expansion through a new $10.6 million office and warehouse that will add 82 local jobs over the next two years gave a shot in the arm to the region’s efforts to become a hub for the logistics industry.
The expansion will consolidate the office space that FedEx currently leases on Ensminger Road and the warehouse that it leases on Kenmore Avenue, both in the Town of Tonawanda, and provide a major tenant for the Riverview Solar Technology Park off River Road.
Fred Schardt, the president of FedEx Trade Networks, discussed the company’s decision to expand in the Town of Tonawanda.
Q: What will the consolidation allow FedEx do that it can’t do now?
A: Today, we’re spread out over several facilities. The ambition, really, is to consolidate, and in that consolidation, there will be more efficiency.
Q: You also looked at Indianapolis and Memphis for this project. Was there anything in particular that was a tipping point for the Town of Tonawanda site?
A: We looked at other places in the United States. Certainly, this was a very good deal. It was a very good deal in terms of sustainability. And also, we’ve got a great group of people here. They’ve done a very good job for the company for many years.
Q: What is it about the local workforce that helped sell you on building the center in the Town of Tonawanda?
A: One of the reasons we did this, besides the sustainability and the great landlord and the great development, is the people. We have almost 1,000 people here in Western New York.
We looked at other places, but frankly, our people here perform so well and do such and outstanding job that we felt we needed to make a very strong commitment to Western New York and to our people here, who have done a wonderful job.
In any business, it’s important to have technology. It’s important to be FedEx, but what makes up FedEx is really the people. It’s just a very productive workforce. It’s a good workforce. It’s an educated workforce. It’s a solid workforce. It’s been a very loyal workforce. Everything just came together. It just made sense.
Q: You’re getting more than $4.5 million in aid from state and local governments. How big of a factor was that in tipping the scale in favor of the Town of Tonawanda.
A: There isn’t just one factor. There are a lot of factors that enter into any decision that we make.
Q: With a $10.6 million project, $4.5 million in incentives is more than 40 percent of the project’s total costs. That’s a pretty big chunk of the costs.
A: We’re a pretty big company. But again, we look at everything. We don’t just look at one isolated thing. Then we evaluate the project in terms of: Does it make sense? Does it make sense for our people? Does it make sense for the company?
Q: You’ve said these are jobs that essentially could be located anywhere. Did the Town of Tonawanda site have a locational advantage, in terms of being close to Canada, having a major airport in Buffalo and another one in Niagara Falls?
A: Not really, in the sense that these are jobs that really could be located anywhere. Our headquarters is in Memphis.
Q: Was there anything else that made the Town of Tonawanda site stand out?
A: I think it just all fit. This facility, the solar power, certainly the cooperation of the state and local government and the developer and also the people. All of those factors are what really led us to the decision that this is the right decision for us.
Q: What does FedEx Trade Networks do?
A: We’re the freight-forwarding arm of FedEx. Over the past four years, we’ve gone from a company with offices only in Canada and the United States to having them in 26 countries. We’ve actually added more than 1,000 jobs over the last three years. So FedEx Trade Networks has really been a growth story for FedEx on an overall basis.
Q: The new building will include a 100-kilowatt solar array. Were the solar-power features really an important factor in your decision?
A: This was a key decision in terms of our move to come here and build here. Sustainable business practices and reducing the environmental impact are central to the long-term vision of FedEx.
When you look at FedEx, I think we’re top 10 in the world in terms of being a most admired company. We’re cutting edge in terms of technology. When people think of our company, they think of things like technology. Certainly, sustainability is always very important. It’s always critical and it’s becoming more and more critical.
Q: Will your utility costs be lower because of the solar power?
A: The utility costs will be less.
Q: How much will you save?
A: I don’t have it off the top of my head. But sustainability at FedEx is something we take very seriously. We’re looking to reduce our carbon dioxide emissions from our 2005 baseline by 20 percent by 2020. We’ve done a lot of work in terms of our fleet. It’s not something we just say. It’s something we take very seriously.
We want to be sustainable. We want to be green. We want to be good corporate citizens. We believe you can operate a business effectively and be a very, very solid corporate citizen at the same time.