Janel Corporation’s only reportable business segment is global logistics
services. Janel’s business activities in this area are conducted through
its wholly-owned subsidiaries Janel Group, Inc. (“JGI”), PCL Transport,
LLC d/b/a President Container Lines (“PCL”) and Liberty International,
Inc. (“Liberty”), which together comprise Janel Group, a multi-branded,
non-asset based third party global logistics services company. Janel Group engages
in full-service cargo transportation logistics management, including freight
forwarding via air, ocean and land-based carriers, customs brokerage services,
and warehousing and distribution services. Throughout this report, we refer
to Janel’s subsidiaries that are engaged in global logistics services
as “Janel Group.”
Janel Group’s traditional freight forwarding and customs brokerage activities
include various value-added logistics services, such as freight consolidation,
insurance, logistics planning, landed-cost calculations, in-house computer tracking,
product repackaging, online shipment tracking and electronic billing. The value-added
services and systems are intended to help our customers streamline operations,
reduce inventories, increase the speed and reliability of worldwide deliveries
and improve the overall management and efficiency of the customer’s supply-chain
activities.
Janel Group operates out of eight leased, full-service locations in the United
States: Lynbrook, New York (headquarters, operations and accounting); Edison,
New Jersey; Philadelphia, Pennsylvania; Elk Grove Village (Chicago), Illinois;
Forest Park (Atlanta), Georgia; Inglewood (Los Angeles), California; Pawtucket
(Providence), Rhode Island; and Boston, Massachusetts. While each Janel Group
office is managed independently, with each manager having over 20 years’
experience in the industry, the offices collaborate closely on revenue-generating
and cost-cutting projects where advantageous to the business as a whole.
Freight Forwarding Services. As a cargo freight forwarder, Janel Group procures
shipments from its customers, consolidates shipments bound for a particular
destination from a common place of origin, determines the routing over which
the consolidated shipment will move, selects a carrier (air, ocean, land) serving
that route on the basis of departure time, available cargo capacity and rate,
and books the consolidated shipment for transportation with the selected carrier.
In addition, Janel Group prepares all required shipping documents, delivers
the shipment to the transporting carrier and, in many cases, arranges clearance
of the various components of the shipment through customs at the final destination.
If requested by its customers, Janel Group will also arrange for delivery of
the individual components of the consolidated shipment from the arrival terminal
to their intended consignees.
As a result of its consolidation of customer shipments and its ongoing volume
relationships with numerous carriers, a freight forwarder is usually able to
obtain lower rates from such carriers than its customers could obtain directly.
Accordingly, a forwarder is generally able to offer its customers a lower rate
than would otherwise be available directly to the customer, providing the forwarder
with its profit opportunity as an intermediary between the carrier and end-customer.
The forwarder’s gross profit is represented by the difference between
the rate it is charged by the carrier and the rate it, in turn, charges its
customer.
In fulfilling its intermediary role, the forwarder can draw upon the transportation
assets and capabilities of any individual carrier or combination thereof comprised
of airlines and/or air cargo carriers, ocean shipping carriers and land-based
carriers, such as trucking companies. Janel Group solicits freight from its
customers to fill containers, charging rates lower than the rates that would
be offered directly to its customers for similar type shipments.
Customs Brokerage Services. As part of its integrated logistics services, Janel
Group provides customs brokerage clearance services in the United States and
in most foreign countries. These services typically entail the preparation and
assembly of required documentation in many instances, the electronic transmission
to federal agencies of this data (Janel Group provides in-house translation
services into Chinese, Spanish or Italian), the advancement of customs duties
on behalf of importers, and the arrangement for the delivery of goods after
the customs clearance process is completed. Additionally, other services may
be provided such as the procurement and placement of surety bonds on behalf
of importers and the arrangement of bonded warehouse services, which allow importers
to store goods while deferring payment of customs duties until the goods are
delivered.
Janel Group has over 30 years of experience clearing a wide range of goods through
U.S. Customs, from automobiles to heavy machinery to textiles. There are fourteen
fully-licensed customs house brokers on staff. Janel Group is fully certified
with U.S. Customs for both ABI and AES transmissions, and has successfully migrated
over 90 percent of eligible transactions to ACE. Janel Group also has extensive
Remote Location Filing capability. Janel Group has established an active “correspondent
Customs House Broker Network” of individuals specially chosen for their
ability to service customers throughout those locations in the United States
where Janel Group does not have its own branch office. In addition, Janel Group
regularly works with a group of proven independent attorneys, whose specialization
in transportation, U.S. Customs law and classifications has resulted in substantial
savings to customers.
Other Logistic Services. In addition to providing air, ocean and land freight
forwarding and customs brokerage services, Janel Group provides its import and
export customers with an array of fully integrated global logistics services.
These logistics services include warehousing and distribution services, door-to-door
freight pickup and delivery, cargo consolidation and de-consolidation, project
cargo management, insurance, direct client computer access interface, logistics
planning, landed-cost calculations, duty-drawback (recovery of previously paid
duties when goods are re-exported), in-house computer tracking, product promotion,
product packaging and repackaging utilizing Janel Group’s mobile packaging
machinery, domestic pickup and forwarding, “hazmat” certifications
for hazardous cargoes, letters of credit, language translation services, online
shipment tracking and electronic billing.
Information Services. Janel Group’s freight forwarding operations uses
a web-based information system (Cargowise) to facilitate communication between
our customers and third party carriers. Janel Group also uses a variety of custom-built
features to enhance customer service and further automate activities. These
systems enable Janel Group to perform in-house computer tracking and to offer
customers landed-cost calculations and shipment tracking and tracing information
online via the Janel Group website (http:///www.janelgroup.com). The system
provides us with real-time, accurate information on Janel Group’s financial
performance.