Profile: Expeditors International of Washington Inc (EXPD.OQ)
1 May 2015
Expeditors International of Washington, Inc. (Expeditors), incorporated on May 29, 1979 is engaged in the business of providing global logistics services. The Company offers its customers an international network supporting the movement and positioning of goods. The Company’s services include the consolidation or forwarding of air and ocean freight. In each United States full service office, and in many overseas offices, the Company acts as a customs broker. The Company also provides additional services including order management, time-definite transportation, warehousing and distribution, cargo insurance, and customized logistics solutions. The Company operates full service offices in the United States (47), Other North America (10), Latin America (14), Asia Pacific (42), Europe and Africa (49) and Middle East and India (23). The Company also maintains sales and satellite offices which are aligned with and dependent on one or more full service offices. Additionally, the Company contracts with independent agents to provide required services and has established 44 such relationships around the world. The Company’s operational segments include Airfreight Services, Ocean Freight and Ocean Services and Customs Brokerage and Other Services. The Airfreight Services segment purchases cargo space from airlines on a volume basis and resells that space to its customers at lower rates. The Ocean Freight and Ocean Services segment offers ocean freight services in most major trade lanes in the world. The Customs Brokerage and Other Services segment assists importers to clear shipments through customs by preparing required documentation.
The Airfreight Services segment performs airfreight services and acts either as a freight consolidator or as an agent for the airline which carries the shipment. As a freight consolidator, the Company purchases cargo space from airlines on a volume basis and resells that space to its customers at lower rates than the customers could obtain directly from airlines on an individual shipment. The Company issues a House Airway Bill (HAWB) to its customers as its contract of carriage and separately receives a Master Airway Bill from the airlines when the freight is physically tendered. When moving shipments between points where the nature or volume of business does not facilitate consolidation, the Company receives and forwards individual shipments as the agent of the airline which carries the shipment. Whether acting as a consolidator or agent, the Company offers its customers knowledge of optimum routing, familiarity with local business practices, knowledge of export and import documentation and procedures, the ability to arrange for ancillary services, and assistance with space availability in periods of peak demand. The Company estimates its average airfreight consolidation weighs approximately 2,600 pounds and a consolidation includes merchandise from several shippers. Airfreight services accounted for approximately 43% of the Company's total revenues for the year ended December 31, 2013.
Ocean Freight and Ocean Services
The Company, under Ocean Freight and Ocean Services segment, operates Expeditors International Ocean, Inc. (EIO), an Ocean Transportation Intermediary, sometimes referred to as a Non-Vessel Operating Common Carrier (NVOCC) which offers ocean freight services in most major trade lanes in the world. EIO also provides service, on a smaller scale, to and from any location where the Company has an office or agent. As an NVOCC, EIO contracts with ocean shipping lines to obtain transportation for a fixed number of containers between various points during a specified time period at an agreed rate. EIO handles full container loads for customers that do not want to contract directly with the ocean carriers and for those customers that prefer to supplement their carrier strategy with an NVOCC. EIO also solicits Less-than Container Load (LCL) freight to fill the containers and charges lower rates than those available directly from shipping lines. The Company issues a House Ocean Bill (HOBL) to customers as the contract of carriage and receives a separate Master Ocean Bill of Lading when freight is physically tendered. Revenues from fees charged to customers for ancillary services which the Company may provide include the preparation of shipping and customs documentation, packing, crating and insurance services, negotiation of letters of credit, and the preparation of documentation to comply with local export laws. Ocean freight services accounted for approximately 32% of the Company's total revenues for the year ended December 31, 2013.
Customs Brokerage and Other Services
The Customs Brokerage and Other Services segment of the Company assists importers to clear shipments through customs by preparing required documentation, calculating and providing for payment of duties and other taxes on behalf of the importer, arranging for any required inspections by governmental agencies, and arranging for delivery. The Company provides customs clearance services in connection with many of the shipments it handles in its transportation services. However, substantial customs brokerage revenues are derived from customers that elect to use a competitor for transportation services. Conversely, shipments handled by the Company may be processed by another customs broker selected by the customer. Customs brokerage and other services accounted for approximately 25% of the Company's total revenues for the year ended December 31, 2013.
The Company also provides other value added services at destination such as warehousing and distribution, time-definite transportation services and consulting services, none of which are significant to the Company’s total revenues and net revenues. The Company's distribution and warehousing services include distribution center management, inventory management, order fulfillment, returns programs and order level services. Transcon is a multi-modal product, which offers time-definite, intra-continental transportation solutions, often by ground and other specialty handling services. The Company’s wholly-owned subsidiary, Expeditors Tradewin, L.L.C., responds to customer driven requests for customs consulting services. Fees for these non-transactional services are based upon hourly billing rates and bids for mutually agreed projects.
Expeditors International of Washington Inc
1015 3rd Ave Fl 12
SEATTLE WA 98104-1184