The Company is continuing to diversify into transportation areas outside its traditional longhaul LTL service. In October 1994, Integrated Distribution, Inc., a wholly owned subsidiary of the Company, expanded its current warehousing operations and added distribution services by the acquisition of two Little Rock, Arkansas companies.

The business lines of Integrated Distribution are storage, consolidation, packaging, and distribution. Integrated Distribution’s strategy is to add value to merchandise in various ways rather than just warehousing. An example of adding value would be transporting truckload or containerload shipments of consumer goods to a warehouse, then packaging the goods into retail-size containers, applying labels and bar-codes, and distributing in the desired mix to retail outlets.

Best Logistics, Inc. ("Best"), a wholly owned subsidiary of Arkansas Best Corporation, engages in third-party logistics management. Best provides logistics consulting and management services to companies desiring to outsource these activities.

Companies choosing to outsource logistics management do so to reduce logistics costs, to concentrate on their core business or to improve customer service. Logistics focuses on the management of inventory and information through the supply chain from supplier to consumer. Best’s role is to design the logistics network, contract with the required carriers and warehouses to implement and then manage the design.

Although third-party logistics is a relatively new industry, a large number of participants exist in the market. Many are related to transportation or warehousing companies.