Beijing China Railway United Logistics Gets the Upper Hand

Selects provider to help optimize, gain real-time control over the movement of goods throughout China

Selects provider to help optimize, gain real-time control over the movement of goods throughout China

Shanghai, China — November 17, 2003 — Supply chain services provider Descartes System Group Inc. announced that it has joined forces with Beijing China Railway United Logistics Co., Ltd., (BCRUL) a logistics company and a division of China Railway United Logistics (CRUL), to enable distribution-sensitive companies to gain real-time control of the movement of goods and inventory in China.

CRUL, named as one of China's top 10 logistics providers in 2002, has asked BCRUL to build and operate a comprehensive real-time logistics information platform that will use the nation's extensive railway network and offer integrated logistics services for sea, air and land transportation in China. CRUL said it believes the Logistics Information Platform will help the company achieve its objective of becoming a prominent third- and fourth-party logistics provider in China.

Descartes said it would provide visibility and transportation management services for the platform, and BCRUL will assist Descartes with the marketing and sales of Descartes solutions to BCRUL business partners and customers, including some of the largest companies in China in steel, tobacco, and wine and beer.

In general, industry analysts have noted that much of the logistics and transportation infrastructure in China is fragmented and confined to regional boundaries making it costly for distribution-sensitive companies to move goods. In addition, a lack of visibility and connectivity between the different modes of transport such as rail, ocean and truck often results in inefficiencies and an inability to track goods as they move throughout the supply chain.

"Distribution and logistics operations are, in most cases, confined to regional boundaries, with operator changes and equipment changes required across boundaries, making it necessary for companies to deal with multiple entities to move goods in or out of China," noted John Fontanella, vice president of Research, in the AMR Research Alert "Connecting Into China — Living in the Present, July 10, 2003." Fontanella also said that multi-modal traffic that uses roads and rails is completely siloed, with no connectivity through different modes of operations.

Recognizing these challenges, CRUL was established in 2001 by China rail related transportation companies, freight forwarders and technology companies, with a mission to improve customers' distribution processes and overall supply chain efficiencies. BCRUL has undertaken the challenge of providing customers with real-time, multi-modal supply chain services by using Descartes solutions.

"Our relationship with Descartes will help us to make significant headway in integrating and reforming the country's logistics infrastructure for greater supply chain performance," said Ms. LiHua Wu, president, BCRUL. "Descartes' global experience, understanding of our local market and ability to provide us with solutions that will enable our customers to improve their processes and help lower distribution costs, makes them a trusted provider of supply chain services to our business."