Oriental Logistics
Hong Kong Headquarters and Distribution Center
Kaohsiung, Taiwan Distribution Center
May 2005
By
Dave Gill
Key Personnel:
Gilbert Lau – CEO
Kurt Su – President
Like many Asian logistics companies, Oriental started off in general warehousing in 1997. With an early expertise and focus on dangerous goods transport, it has expanded rather quickly into high end high value-added services such as 3P warehousing, total logistics services, inventory management, freight-forwarding, and e-commerce logistics services. It has D.C.s in Guangzhou, Hong Kong, Shanghai, a new D.C. in Beijing, and recently (2003) acquired Kaohsiung, Taiwan D.C. Previously, it owned a Shenzhen D.C. but it is now operated as an agent. Oriental is composed of a family of four companies:
Oriental Logistics Co. LTD.; the Hong Kong based branch offering 3PL services.
Oriental Physical Distribution Co. Ltd.; ownership of all trucks and equipment used in operations.
Oriental Logistics (Guangzhou) Co. Ltd.; provides 3PL service in Mainland China with D.C.s in Guangzhou (2002), Shanghai (2002) and a new one in Beijing. In addition, operations are bolstered by an agent D.C. in Shenzhen. Together, they can provide distribution to a growing network of 75+ cities in the PRC.
Oriental Logistics Taiwan Ltd.; provides 3PL services including IBC transport and a newly implemented GPS tracking system. President Kurt Su lived in Canada for 10 years before returning to his native Taiwan. Their site is rather small and due to duty laws (bulk goods stored over two years are duty-free), raw materials are sometimes stored a long time. In addition, I noticed that about one-third of their D.C. is shuttered and has been unused for quite sometime.
Due in part to a 24-hour accessible online tracking system and an emphasis on “zero-defect quality, contracts nearly doubled yearly in 2002 and 2003. Fiscal data for 2004 is not out yet but an increase in contracts of 90%+ was estimated. 70% of their revenue comes from logistics operations. The Oriental Systems Center creates the remaining revenue from sales of proprietary WIS and BMS software based on and in cooperation with Oracle 8i. SinoTrans, one of the biggest Asian shippers, uses Oriental software. Using proprietary “e-order”, customers can restock goods via the internet.
Oriental rarely loses customers. One of its biggest challenges is its contract with the Hong Kong Tourism Board. They have handled the supply and distribution of promotional materials for 30 offices around the world since 1997. Oriental’s customer list also includes GE, Ciba, Phillips, Avon, Bridgestone, Adidas, Carrier, Kimberly Clark, Exxon Mobil, Matrox, World Family, Isola, etc.
Oriental offers the following value-added services:
- Upsizing / downsizing
- Repacking / dual-packing / on-packing
- Labeling / relabeling / bar-coding
- E-fulfillment / order fulfillment
- 24-hour emergency order support
- Cylinder refilling of refrigerant
- Light process / assembly
- E-commerce marketing support
- Printing / package design
- Home delivery
- Real-time record
- Online enquiry system
- Customer service support – CCTV
At their Hong Kong D.C., Oriental provides the E-fulfillment packaging and distribution for DHC Cosmetics (the Avon of Asia).
CEO Gilbert Lau is a smiling, “people person” who has nurtured Oriental since its founding. He takes pride in a ten step QMS system that starts with management’s commitment to excellence. This has won him acknowledgment as a “Top 10 Business Maker” by the Hong Kong government in 2000. In addition, his company earned an “Outstanding Enterprise in IE Award” 2002 and a “Caring Company Award” in 2003. From Dupont, Oriental earned the “Responsible Shipper Zero-Defects” award in 1998/2000/2002/2004.
Large or small, each customer gets individualized service. Oriental shies away from large customers due to the risk factor present if they terminate a contract and a large part of their warehouse is suddenly vacated. Mr. Lau has emphasized steady but small growth for Oriental and has developed relationships with Hoyer, G&U Logistics, Anker Leschaco Logistics of Germany, and a partnership in Hamburg, Germany.
Sources: A&A Primary Research, http://www.orientallogistics.com/