Beijing Furui Logistics Co., Ltd.

Beijing, China Site Visit

January 6, 2011

By

Eric Xiang

Key Personnel:

Mr. Zhang Jihai, General Manager

Mr. Liang Zhao, Operation Manager

Founded in 2006, Beijing Furui Logistics Co., Ltd. (Furui Logistics) is a cold chain distribution specialist. Headquartered in Beijing, it has a total staff of 100 employees including drivers and has sales offices in Shenyang, Ji’nan, Shanghai, Hefei, and Foshan.

Compared to other cold chain providers, Furui Logistics has built a highly efficient distribution network in Beijing where it has five warehouses and storage center with the capacity to store 3,000 tons of goods below -18°. It also has its own fleet of refrigerated trucks which are GPS equipped and temperature-controlled between -30° to 20°. In addition, it has more than 20 refrigerated mini-cars which provide it with the ability to quickly reach any destination in Beijing within 24 hours. Its mini-cars have been very welcomed by customers.

Furui Logistics uses a central dispatch operation to manage all of its trucks and mini-cars. For example, Truck “A” is full of freight from Warehouse “A”, which is distributed to stores. If the final store delivery is near Warehouse “B”, Truck “A” will not return to Warehouse “A”. Instead, it will go to Warehouse “B” and then load the freight from Warehouse “B” for next day delivery. This avoids running empty trucks and saves on fuel costs. At the same time, it can provide competitive rates and secure more business from small- and medium-sized customers. Since Furui Logistics has been successful in dispatch center management, it plans to build similar distribution networks in other major cities in China in the future. Currently, it uses subcontractors for city-to-city distribution.

The top two dairy companies in China, Mengniu Dairy Group and Inner Mongolia Yili Industrial Group, are major customers of Furui Logistics. Their products are distributed throughout China which provides Furui Logistics the opportunity to set up distribution networks in China for both companies. According to Mr. Zhang Jihai, Furui Logistics’ general manager, one of the companies has already discussed the possibility of outsourcing all of its logistics services including its warehousing in the Beijing area. This would give Furui Logistics the opportunity to expand its business further in 2011.

Furui Logistics has been successful at developing new customer relationships in the past four years. It was one of the cold chain logistics providers for the Beijing 2008 Olympic Games. It also provides cold chain logistics services to Zhengzhou Sanquan Foods Co., Ltd, serving both South China and North China though its Foshan and Shenyang offices. Elders Foods (Shanghai) Limited is another Furui Logistics customer.

Furui Logistics’ key strength is in last-mile cold chain distribution. By continuing to expand its relationships with existing customers and establish new customers with last-mile, cold chain distribution needs, we see Furui Logistics having significant growth and development in the coming years.

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