Hangzhou Huashang Logistics Co., Ltd.
Hangzhou, China Site Visit
November 20, 2012
Mr. Fang Xianjin, General Manager
Ms. Liu Hao, General Manager Assistant
Founded in 2004, Hangzhou Huashang Logistics is a home appliance/consumer electronics focused third-party logistics provider (3PL). It has a total of 200 employees working in the cities of Hangzhou, Jinhua, Ningbo, Taizhou and Wenzhou in the province of Zhejiang. According to Ms. Liu Hao, Huashang Logistics was the logistics department of a supermarket before 2004, so it is experienced in fast-moving consumer goods (FMCG) and cold chain logistics as well. About 65% of its gross revenue is from supermarket customers and the rest is from home appliance/electronics customers.
Huashang Logistics has 130 trucks and 250,000 square meters of storage space. Many well-known home appliance/electronics brands in China are customers of Huashang Logistics such as TCL, KONKA and Hisense. Huashang Logistics has five warehouses in Zhejiang its customers use as regional distribution centers (RDCs). Its Hangzhou warehouse is for distribution east of Zhejiang, its Jinhua warehouse is for distribution northwest of Zhejiang and its Ningbo, Taizhou, and Wenzhou warehouses are for distribution south of Zhejiang. Huashang Logistics provides delivery from the warehouses to the dealers or end users. Most shipments are less-than-truckload (LTL).
During my visit, I found that TCL has deep cooperation with Huashang Logistics as TCL has a representative office in its RDC. This has brought the companies closer together.
For cold chain logistics, Huashang Logistics has 20 trucks which are temperature and video controlled. Goods are delivered to more than 130 stores usually under the supermarket brand. In 2007, Huashang Logistics passed ISO 9000.
In 2011, Huashang Logistics started a business-to-consumer (B2C) business for wine distribution. About 10,000 square meters of warehouse space is used for wine distribution in Hangzhou.
For its cargo volume, Huashang Logistics handles more than 250,000 shipments (500,000 CBMs) of home appliances/electronics and 7,500 shipments (200,000 CBMs) of supermarket goods.
Although the trucks are under GPS (global positioning system) control, Huashang Logistics does not invest too much in its systems. All shipment tracking is done by phone with truck drivers and customers.
Huashang Logistics is a good LTL service provider in Zhejiang. As the B2C business for home appliances/electronics has excellent growth potential in the future, we believe Huashang Logistics will continue to grow too. However, it needs a system to manage the transportation and planning in order to continue to provide competitive solutions to its customers.
Sources: A&A Primary Research, http://www.hzhs56.com/