Long Sail International Logistics Co., Ltd.

Shenzhen, China Site Visit

June 3, 2014

By

Eric Xiang

Key Personnel:

Mr. Johannes Huang, General Manager

Mr. Ned Wong, Overseas Manager

Long Sail International Logistics Co., Ltd. was founded as an ocean freight forwarder in 1997. Today, it has 14 branch offices and 500 employees in China. It is a key local operator in Shenzhen.

Long Sail International Logistics is NVOCC (non-vessel operating common carrier) licensed for ocean freight and Class A licensed for air freight. Ocean freight is 90% of the business and air freight is 10%. Full container load (FCL) ocean exports is its core business. It has established relationships and contracted with most of the carriers in the market.

About 50% of its cargo volume goes to Europe, 20% goes to the Far East and India, 15% goes to Southeast Asia, and the rest goes to South America. The U.S. currently is not a key region served, but Long Sail is interested in developing the market there.

According to Mr. Johannes Huang, Long Sail handles 13,000 TEUs (twenty-foot equivalent units) per month, so its annual cargo volume reaches over 150,000 TEUs. Small logistics companies make up 30% of the TEUs handled as Long Sail acts as the booking agent for the carriers and therefore receives more competitive rates. Direct customers make up the rest of the cargo volume handled. Long Sail is focusing on small- and middle-sized enterprises. It has 150 long-term customers ensuring a stable base for growth in the future.

Long Sail uses overseas agents and is experienced in agent management and global network development. Most the business is under CIF (cost, insurance, freight) terms. Only 12% of the business that comes from the overseas agents is under FOB (free on board) terms.

Appliances and building materials are the main commodities handled by Long Sail International Logistics. CHIGO Home Appliance, Skyworth and TCL are key customers.

In Shenzhen, Long Sail has its own tractors and license for customs brokerage. In Guangzhou, a bonded warehouse is leased for overseas customers. Long Sail can provide door-to-door services, including distribution. In Qingdao, Long Sail operates an LCL (less-than-container load) service to the U.S. Long Sail is trying to meet different requirements from different customers.

Recently, Long Sail is keeping its eye on the B2C (business-to-consumer) market as the internet business is growing. Long Sail is interested in investing more in the B2C business and understands warehousing facilities are important.

Although Long Sail International Logistics hasn’t done much in the U.S., Mr. Johannes Huang is very interested in cooperating with a U.S. logistics company to develop the China-U.S. market together.

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