Ningbo Hailian Logistics Co., Ltd.

Ningbo, China Site Visit

October 4, 2011

By

Eric Xiang

Key Personnel:

Mr. Xiang Xianjin, Deputy General Manager

Ningbo Hailian Logistics Co., Ltd. (Hailian) was founded in 1988 with a focus on less-than-truckload (LTL) shipments. Today, about 70% of the business is LTL on annual shipment volume of 240,000 tons. With nearly 600 employees, Hailian generated $30 million in gross revenue in 2010.

Hailian operates in more than 30 lanes under a fixed schedule from Ningbo and surrounding cities. Its main market is between Ningbo and the Guangdong area including Guangzhou, Shenzhen, Nanhai, Foshan, Shunde and Zhongshan.

Hailian operates a 55,000 square meter warehouse in Ningbo which also acts as the terminal for LTL shipments. It has 240 gates. One gate is for one lane or one small LTL carrier. Sixty percent of the gates are operated by Hailian and display the Hailian Logistics logo. The other gates are operated by other local, small LTL carriers. These LTL carriers rent the gates from Hailian. Over 80% of the freight is consolidated into truckloads handled by carriers coming from destination cities. Since most of the trucks return to the destination cities, Hailian receives competitive rates from the truckload carriers. All trucks are GPS equipped making it easy for Hailian to track the shipments. Hailian's customer service team is also available for customers to track shipments by phone.

In addition to its LTL business, Hailian operates a warehouse over 10,000 square meters for goods that need storage and distribution. About half of the warehouse is dedicated to Inner Mongolia Yili Industrial Group, one of the largest dairy producers in China.

Hailian also has an office in Suzhou with a staff of 20. The Suzhou office handles warehousing and transportation management for one of its key customers, Mainetti, a garment hanger manufacturer.

Hailian is a professional at its LTL business covering most destinations in China but is cautious in expanding and setting up branch offices to build its own strong network because of the costs involved.

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