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Development of Comprehensive Logistics Solutions

Policy

Approach

The SG Holdings Group believes that realizing greater efficiency in logistics by responding to changes in the market environment through comprehensive logistics solutions is essential for continuing to provide people with a convenient lifestyle. In order to realize the improvement of efficiency, it is necessary to engage in the creation of local transportation networks and provide forwarding not only in Japan but also overseas, especially in Asia, which is expected to grow into the future. Finding new possibilities for responding to the social background in Japan and overseas is seen to be an important issue, and we will contribute to improving the efficiency of logistics by seeking out new solutions.

Systems

GOAL® (GO Advanced Logistics)

GOAL is a specialized group providing the best solutions for logistics by identifying underlying customer issues. Product life cycles are shortening, service competition is intensifying and business is becoming more globalized. One of the keys to responding to such changes in the market environment is improving the efficiency of management through overall optimization of logistics. In response to such changes in the market environment, GOAL provides logistics solutions merging the nationwide network of Sagawa Express, which has strengths in distribution between businesses, the diverse resources of Sagawa Global Logistics such as logistics processing, and the global, IT and payment functions of Group companies. GOAL uses a system of teams of four to six people, and currently has around 200 people forming teams by area nationwide. Sagawa Express has also established a marketing team with specialized knowledge, providing support to the area-based teams as required.

Expansion of International Logistics

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Overseas business management company SG HOLDINGS GLOBAL
Local subsidiaries
    • Tianjin Poly-Sagawa International Trading
    • Shanghai Poly-Sagawa Logistics
    • Poly-Sagawa Logistics
    • Sagawa Express (H.K.)
    • Sagawa Express International Taiwan
    • Sagawa Logistics Korea
    • Sagawa Express Philippines
    • Sagawa Express (Thailand)
    • SG Sagawa (Thailand)
    • Sagawa Express Vietnam
    • SG Sagawa Vietnam
    • SG Sagawa Express Vietnam
    • SG Sagawa Ameroid
    • SG Sagawa USA
    • Expolanka Holdings

90 companies in total

Through SG Holdings Global, our overseas business management company based in Singapore, we conduct a freight forwarding business, which is our core business, in overseas markets especially in rapidly growing Asia, and also provide high added value services from upstream to downstream in the supply chain by strengthening businesses surrounding logistics, such as customs clearance, 3PL (enterprise logistics) and domestic land transportation. In particular, SG Holdings positions Vietnam with its rapidly expanding textiles industry as a vital location in its global strategy. With Sagawa Express Vietnam launched in a joint venture with local capital under the socialist country's regulations, SG Sagawa Vietnam established as a wholly-owned subsidiary in 2015, and SG Sagawa Express Vietnam established through an M&A deal with a delivery company with a delivery network spanning all of Vietnam in 2016, it has become possible to conduct a variety of business using a three-company system. At present, we have offices in the north and south, in addition to five distribution warehouses and 99 hub service centers covering all of Vietnam as we build a network within the region to provide total support to customers' production and sales in Vietnam from a logistical aspect. Furthermore, we are also providing solutions linking 3PL and the Last One Mile such as deliveries to individual homes using package pickup counters in shopping malls in Vietnam and fulfillment centers (handling storage, order management and delivery to individual homes) for rapidly expanding e-commerce. In May 2014 we strengthened our freight forwarding operations by acquiring a managing interest in Expolanka, a Sri Lankan logistics company, through a tender offer. The company has particular strength in logistics not only in Sri Lanka, where it is based, but also in neighboring India and Bangladesh, and also has logistics networks in emerging markets such as the Middle East and Africa, and has expanded out integrated transportation services in international logistics within Asia and connecting Asia with Europe and America.

  • SG Holdings Group vehicles on the road in Vietnam
  • SG Holdings Group vehicles on the road in Vietnam

SG Holdings Group vehicles on the road in Vietnam

Initiatives

"TMS" Proving Diverse Means of Transportation

Sagawa Express provides "TMS (Transportation Management System) as a new logistics service for carrying all "goods" not limited to package delivery services. This provides optimal solutions tailored to customers' needs by utilizing the know-how of the SG Holdings Group and the transportation networks of long-haul partners to produce transportation modes other than package delivery services. This makes it possible to perform total management for the complete relocation of factories and large-scale offices, provide special transportation of heavy goods such as aircraft and railway cars, delicate goods such as artworks and animals, etc., and operate milk runs.

Flow in the Example of Trailer Transportation of Concrete Blocks

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Smart Delivery®

Sagawa Express has been expanding the "Smart Delivery®" services to dramatically increase efficiency from procurement (stocking) deals to receipt of goods (warehousing/inspection) between businesses. It is a service for reducing customers' burdens on their staff and on the environment, and the service is operated in large logistics centers and large shopping malls. In usual delivery, packages to large facilities such as shopping centers are separately delivered by different suppliers, but under the Smart Delivery®, packages are gathered and sorted by product category or location in Sagawa Express transfer centers and sales offices before being delivered to the final destination as specified by the consignee. Support is also provided for time slot-specific delivery including late night and early morning.

Normal delivery of packages separately from multiple companies → Improvement of efficiency of logistics through smart delivery

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Facility Logistics

Sagawa Express and World Supply provide "facility logistics systems" that centrally manage the entry and exit of people, goods, vehicles and information at facilities such as large-scale commercial complexes to promote greater efficiency in logistics. The two companies combined have been entrusted with 90 properties in total, including Tokyo Skytree®, Tokyo Midtown and GINZA SIX. The adoption of facility logistics systems helps aggregate delivery vehicles, mitigate traffic jams around facilities and reduce the environmental impact. The effectiveness of these systems earned a certification from the Tokyo District Distribution Efficiency Certification System (2014) as well as the outstanding the Ministry of Land, Infrastructure, Transport and Tourism (MLIT) Minister's Award for the Excellent Green Logistics Commendation Program (2014).

Delivery at GINZA SIX

Delivery at GINZA SIX

Number of Facility Logistics System Outsourcing Contracts 90

Fulfillment Service for Recalls

Sagawa Express has provided "Recall Total Service" for handling all aspects of recalls since March 2012. The content of the service is diverse, and includes collection of defective items, replacement with substitutes, handling of refunds, and operation of call centers for responding to inquiries from customers in the event of a recall. Implementing recall operations without delay not only enables companies to avoid management risks, but also fulfill their social responsibility.

Provision of One-stop Solutions for Relocation of Offices and Stores

In March 2018, SG Moving newly obtained a construction business license from the Ministry of Land, Infrastructure, Transport and Tourism, enabling it to provide one-stop handling of all operations related to the relocation of offices and stores. Recently, there has been an urgent demand to respond to needs including not only the movement of packages in office relocation, but also proposals of office design aimed at work style reform. In addition to know-how spanning from procurement of construction materials to delivery and minor construction work, the acquisition of this license has made it possible to handle all aspects of operations such as large-scale renovations and interior construction work within facilities, enabling SG Moving to provide new services to meet customers' needs as a comprehensive production business operator contracted to handle all aspects including the design, proposal and construction of office spaces.

Provision of "Extended Warranty Services" in the E-Commerce (EC) Market

At present, there are not many companies providing extended warranty services for products in the EC market due to the complexity of sales schemes and the low level of awareness and use compared to similar services in large electronics retailers. However, because this is an area which consumers expect to meet their needs, SG Moving began the "SG Extended Warranty Service" jointly developed with TWG Warranty Service Inc. in October 2015. It is a service for providing repairs in accordance with predetermined warranty provisions for a certain period after the manufacturer's warranty has expired.

Commencement of Shipping and Receiving Inspections Using RFID

In 2017, Sagawa Global Logistics commenced shipping and receiving inspections using RFID with the cooperation of COEN CO., LTD., at COEN's logistics site which is contracted within the Higashimatsuyama SRC large-scale distribution facility. RFID is an automated recognition system for reading and writing wireless communication data, and has been able to improve the efficiency of inspection operations previously performed manually in two steps when shipping and receiving goods by installing gate-type RFID readers. As a result, the productivity per hour has increased by 7.8 times in receiving inspections and 8.9 times in shipping inspections, and this is expected to lead to a reduction in personnel required. Future improvements in productivity utilizing RFID are expected to provide a solution to the issue of the "labor shortage" in the logistics industry.

Commencement of WeChat Pay Service

Sagawa Financial concluded an agreement with Tenpay Payment Technology in November 2017 as an official agent of WeChat Pay in Japan, and provides the "SAGAWA SMART PAY" payment application. WeChat Pay is a mobile settlement service using QR codes and account data from WeChat, which is one of the largest SNS in China. It is used by more than 800 million people, and has been implemented in over 10,000 stores in Japan. Business operators in Japan are asked to provide their own tablets for reading QR codes, and can use WeChat Pay by downloading the "SAGAWA SMART PAY" application. Sagawa Financial is supporting business operators' efforts to capture inbound demand through the provision of settlement services in order to respond to the needs of rapidly increasing Chinese tourists visiting Japan.

  • WeChat Pay logo

    WeChat Pay logo

  • Image of the SAGAWA SMART PAY icon

    Image of the SAGAWA SMART PAY icon

Business in Collaboration with Hitachi Transport System

SG Holdings and Sagawa Express have concluded a capital alliance with Hitachi Transport System, Ltd. to strengthen the ability to make proposals through sales partnerships in Japan and abroad, jointly develop services, and share facilities and vehicles. Within Japan, the Sagawa Express Oyamazaki Sales Office was opened within the Oyamazaki AE Sales Office owned by Hitachi Transport System in Otokuni-gun, Kyoto in April 2018. The facility combines delivery and logistics operations to provide one-stop solutions. This has made it possible to move Sagawa Express delivery times forward, improve the working environment for drivers, reduce the distance traveled by trucks and reduce the number of trucks. This also enables Hitachi Transport System to postpone shipment work hours and effectively utilize resources through facility sharing. As a result, CO2 emissions have been reduced by 32%, efficiency of logistics operations have been improved, and labor-saving has been achieved, leading to recognition as a comprehensive rationalization plan under the Revised Act on Promotion of Integration and Rationalization of the Distribution Services specified by the Ministry of Land, Infrastructure, Transport and Tourism for the revised Act. Furthermore, the know-how of both groups has been utilized overseas in areas where each group has strengths in Thailand (Hitachi Transport System Group) and Vietnam (SG Holdings Group) to be more competitive in Asia especially in the 3PL and delivery businesses through a variety of initiatives such as the enhancement and expansion of cross-border logistics in Southeast Asia.

Comprehensive Rationalization Plan Certification Mark

Comprehensive Rationalization Plan Certification Mark

Sagawa Express Oyamazaki Sales Office

Sagawa Express Oyamazaki Sales Office

Smart Import® International Logistics Service for Japan

Smart Import is a service for business operators with production sites across Asia. Products are received in local logistics sites and then internationally transported to their destinations in Japan after distribution processes such as inspection, sorting and Japanese delivery slips. With all distribution processing completed overseas, customers receive benefits such as (1) reducing labor in Japan, (2) reducing the cost of returns of defects and customs, and (3) reducing lead times and optimizing costs. Service for companies selling apparel with production sites in China began to be provided in collaboration with Hitachi Transport System Group in October 2016, and services from the SG Holdings Group's locations in Vietnam have also begun. The range of products handled will be expanded in future to meet customers' needs.

Smart Import

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