Jayud Global Logistics Ltd.

Company Overview

Business Model: Jayud Global Logistics Limited is a Shenzhen-based end-to-end supply chain solution provider in China, primarily focusing on cross-border logistics services. The Group's core services include freight forwarding, supply chain management, and other value-added services such as customs brokerage and intelligent logistics IT systems. Revenue is generated through integrated cross-border logistics, fragmented logistics (air, ocean, overland), chartered airline freight, warehousing, international trading, and agent services.

Market Position: The Company positions itself as a leading Shenzhen-based provider in China's highly fragmented end-to-end cross-border supply chain solution market. Its competitive advantages include customized logistics services, omni-bearing supply chain solutions, established customer relationships, and digitalization of logistics services. Jayud Global Logistics Limited holds a China AEO Certificate from China Customs and its PRC subsidiaries obtained ISO 9001:2015 management certification in October 2022.

Recent Strategic Developments: Jayud Global Logistics Limited completed its initial public offering on Nasdaq Capital Market in April 2023, raising approximately US$4.86 million in net proceeds, followed by a follow-on offering in December 2024, raising US$9.76 million net proceeds. The Company has pursued strategic expansion, including:

• Establishing Joyed Logistics Service Inc. in the U.S. in April 2023.
• Acquiring 51% equity in Shenzhen Ronghai Tongda Supply Chain Management Co., Ltd. in July 2023 and 100% equity in HK XINYX Technology Limited in September 2023, both for international trading.
• Acquiring 51% equity in Shenzhen Jiniu International Logistics Co., Ltd. in January 2024.
• Expanding U.S. operations in October 2024 through equity issuances for:
  • 20% equity in HYTX Warehouse No.3 LLC (California, 70,000 sq.ft. warehouse).
  • 49% stake in HYTX Warehouse No.10 LLC (California, 43,000 sq.ft. warehouse).
  • 10% equity in LD Global Logistics Inc. (Georgia, USA, licensed customs broker).
  • 95% equity in YUKON FLOORING BELLAIRE, LLC (Houston, Texas, 28,320 sq.ft. warehouse and land).
• Terminated agreements to acquire Qingdao Oranda Supply Chain Management Co., Ltd. (October 2024), HYTX Warehouse Inc. (March 2025), and HYTX Warehouse No.11 LLC (December 2024).

Geographic Footprint: Headquartered in Shenzhen, China, the Company maintains a presence in 8 provinces in mainland China (including Shenzhen, Nanjing, Yiwu, Tianjin) and major global transportation hubs like Hong Kong. Its global freight network spans Asia-North America, Asia-Europe, and Intra-Asia trade lines, with operations across six continents and over 80 countries, including the United States, India, Philippines, Thailand, United Kingdom, and the EU. The Company owns 95% interest in a 28,320 sq.ft. warehouse and related land in Houston, Texas.

Cross-Border Operations: Jayud Global Logistics Limited operates as a Cayman Islands holding company, with its primary operations conducted through subsidiaries in mainland China, Hong Kong, and the U.S.A. The Company's core focus is cross-border logistics services, supported by international trading activities through its Hong Kong and PRC subsidiaries. As of December 31, 2024, its PRC counsel advised that all material and necessary licenses, permits, and registrations for its business operations in China had been obtained. The Company is subject to PRC regulations concerning data security, cybersecurity reviews, and overseas securities offerings, and its PRC subsidiaries generate essentially all revenue in Renminbi, which is subject to foreign exchange risk and governmental controls on currency conversion.

Financial Performance

Revenue Analysis

Profitability Metrics (2024):

• Gross Margin: -2.0%
• Operating Margin: -9.2%
• Net Margin: -9.8%

Investment in Growth:

• R&D Expenditure: $0.2 million (0.19% of revenue)
• Capital Expenditures: $0.1 million (RMB0.7 million)
• Strategic Investments: In 2024, the Company made several non-cash acquisitions in the U.S. by issuing Class A ordinary shares, including 20% equity in HYTX Warehouse No.3 LLC, 49% stake in HYTX Warehouse No.10 LLC, 10% equity in LD Global Logistics Inc., and 95% equity in YUKON FLOORING BELLAIRE, LLC (fair value of assets RMB14.7 million / US$2.0 million).

Currency Impact Analysis:

• The Group experienced a foreign currency exchange gain of RMB4.4 million in 2022, followed by losses of RMB1.4 million in 2023 and RMB2.9 million (US$0.4 million) in 2024.
• The Company has not entered into any hedging transactions to mitigate foreign exchange risk.
• The functional currencies for PRC and Hong Kong subsidiaries are Renminbi and Hong Kong Dollar, respectively, with the reporting currency being Renminbi.

Business Segment Analysis

PRC & Hong Kong

Financial Performance (2024):

• Revenue: RMB565.0 million (US$78.6 million)
• Gross Loss: RMB(12.0) million (US$(1.7) million)
• Operating Loss: RMB(47.7) million (US$(6.6) million)
• Key Growth Drivers: The increase in supply chain management revenues, primarily from a new subsidiary focusing on electronic devices and chips import, and growth in customs brokerage services. This was partially offset by a decrease in freight forwarding revenues due to disposed subsidiaries/branches and reduced chartered airline services.

Product Portfolio:

• Integrated cross-border logistics services (contract logistics for lithium-ion battery, consumer electronics, and personal computer manufacturers; basic logistics for e-commerce and SMEs).
• Fragmented logistics services (air, ocean, and overland freight).
• Chartered airline freight services (e.g., Shenzhen-to-Clark, Philippines route).
• Warehousing services (one self-operated warehouse in Shenzhen, one third-party warehouse in Yiwu).
• Supply chain management (international trading, agent services).
• Other value-added services (customs brokerage, proprietary intelligent logistics IT systems including WMS, OMS, TMS, BMS, and the Lenovo Service Control Tower (Spider)).

Market Dynamics:

• Operates in a highly fragmented market, benefiting from Shenzhen's geographical advantages for logistics.
• Serves customers in electronics, new energy, e-commerce, and manufacturing sectors.
• Subject to extensive PRC regulations across various aspects of its operations.

Geographic Revenue Distribution (2024):

• PRC & Hong Kong: RMB565.0 million (US$78.6 million) (98.3% of segment revenue before eliminations)
• Growth Markets: The Group's global freight network covers Asia-North America, Asia-Europe, and Intra-Asia trade lines, with a footprint across six continents and over 80 countries.

U.S.A.

Financial Performance (2024):

• Revenue: RMB9.7 million (US$1.4 million)
• Gross Profit: RMB0.8 million (US$0.1 million)
• Operating Profit: RMB0.01 million (US$0.001 million)
• Key Growth Drivers: This is a newly established segment in 2024, with revenue primarily driven by recent acquisitions of warehousing and customs brokerage interests in the U.S.

Product Portfolio:

• Warehousing services (HYTX Warehouse No.3 LLC and HYTX Warehouse No.10 LLC in California, YUKON FLOORING BELLAIRE, LLC in Houston, Texas).
• Customs brokerage (LD Global Logistics Inc. in Georgia, USA).
• Freight forwarding (Joyed Logistics Service Inc., YUKON JYD LLC).

Market Dynamics:

• Represents a new market entry for the Group, established through strategic acquisitions in 2023-2024.
• Focuses on expanding warehousing and customs brokerage capabilities to support cross-border logistics into and within the U.S. market.

Geographic Revenue Distribution (2024):

• United States: RMB9.7 million (US$1.4 million) (1.7% of segment revenue before eliminations)

International Operations & Geographic Analysis

Revenue by Geography:

International Business Structure:

• Subsidiaries: Key international subsidiaries include Jayud Global Logistics (Hong Kong) Limited, Joyed Logistics Service Inc. (U.S.A.), HK XINYX Technology Limited (Hong Kong), YUKON FLOORING BELLAIRE, LLC (U.S.A.), and YUKON JYD LLC (U.S.A.). These entities facilitate freight forwarding, international trading, and warehousing operations across jurisdictions.
• Joint Ventures: The Company holds equity interests in several entities, such as 51% in Shenzhen Ronghai Tongda Supply Chain Management Co., Ltd. and 51% in Ezhou Jayud International Logistics Co., Ltd., which contribute to its international trading and freight forwarding capabilities.

Cross-Border Trade:

• Export Markets: The Group's global freight network supports exports across Asia-North America, Asia-Europe, and Intra-Asia trade lines, reaching over 80 countries.
• Import Dependencies: Its supply chain management segment includes international trading, with a focus on electronic devices and chips import.
• Transfer Pricing: The Company is subject to PRC regulations on transfer pricing for inter-company transactions, which impacts its international tax strategy.

Capital Allocation Strategy

Shareholder Returns:

• Share Repurchases: In 2023, RMB35.0 million was paid to Initial Shareholders.
• Dividend Payments: Subsidiaries declared RMB11.9 million in cash dividends in 2022. Total cash dividends paid amount to RMB7.5 million (US$1.0 million). As of December 31, 2024, RMB6.9 million (US$1.0 million) in dividends remained payable to shareholders.
• Future Capital Return Commitments: The Company has no present plan to declare or pay cash dividends on its ordinary shares in the foreseeable future.

Balance Sheet Position (as of December 31, 2024):

• Cash and Equivalents: $5.1 million (RMB37.0 million)
• Total Debt: $4.3 million (RMB31.1 million), comprising short-term borrowings, related party loans, shareholder loans, and current and non-current operating lease liabilities, and non-current other payables to shareholders.
• Net Cash Position: $0.8 million (RMB5.9 million)
• Debt Maturity Profile: Contractual obligations total RMB24.3 million (US$3.4 million), with RMB22.3 million (US$3.1 million) due within one year, RMB0.9 million (US$0.1 million) due within 1-2 years, and RMB1.2 million (US$0.2 million) due over 2 years.

Cash Flow Generation:

• Operating Cash Flow: The Company reported negative operating cash flow of $(13.6) million (RMB(97.4) million) in 2024, an increase from $(6.2) million (RMB44.2 million) in 2023.
• Free Cash Flow: Inferred to be approximately $(13.7) million in 2024 (Operating Cash Flow of $(13.6) million minus Capital Expenditures of $(0.1) million).
• Cash Conversion Metrics: Average days sales in receivables were 35 days in 2024, while average days sales in payable were 29 days.

Currency Management:

• The Group's cash holdings are primarily in Renminbi, Hong Kong Dollar, and U.S. Dollar.
• The Company has not entered into any financial hedging transactions to manage its multi-currency exposure.

Operational Excellence

Production & Service Model: Jayud Global Logistics Limited operates an end-to-end supply chain solution model, offering integrated and fragmented logistics services, chartered airline freight, warehousing, international trading, agent services, customs brokerage, and intelligent IT systems. The Company emphasizes customized solutions for contract logistics and modularized offerings for basic logistics. Quality control is maintained through ISO 9001:2015 certification, internal regulations, employee training, regular management meetings, GPS tracking on vehicles, stringent supplier/partner quality requirements, and customer feedback mechanisms.

Global Supply Chain Architecture: Key Suppliers & Partners:

• Logistics Service Providers: The Company relies on a network of logistics service providers, including Winpass Logistics (HK) Co., Limited and Cargo Link Logistics HK Company Limited. In 2024, one supplier accounted for 24.8% of total purchases, and another for 36.1% of total accounts payable.
• Cargo Airlines: Strategic cooperation with domestic and international airlines is maintained for air freight services, including specific air charter service agreements for routes like Shenzhen-to-Clark, Philippines.
• Third-Party Warehouses: The Group utilizes third-party warehousing, such as a facility in Yiwu, Zhejiang province.

Facility Network:

• Manufacturing: Not applicable, as the Company is a logistics service provider.
• Research & Development: The R&D team consisted of one employee as of December 31, 2024, focusing on developing proprietary IT systems.
• Distribution: The Company's network includes its corporate headquarters in Shenzhen, a self-operated warehouse in Shenzhen (20,750 sq. m. GFA), and equity interests in U.S. warehouses (HYTX Warehouse No.3 LLC, HYTX Warehouse No.10 LLC in California, and YUKON FLOORING BELLAIRE, LLC in Houston, Texas). It also operates with a small fleet of two self-owned trucks.

Operational Metrics: Specific quantitative operational metrics such as capacity utilization or efficiency measures beyond financial ratios are not explicitly disclosed in the filing.

Market Access & Customer Relationships

Go-to-Market Strategy: Distribution Channels:

• Direct Sales: The Company employs a direct sales approach, supported by sales and marketing teams in China, which comprised 47 employees as of December 31, 2024.
• Tendering Processes: Tendering processes accounted for 12.0% of total revenues in 2024, generating RMB67.7 million (US$9.4 million).
• Digital Platforms: Jayud Global Logistics Limited leverages proprietary intelligent logistics IT systems, including Warehouse Management System, Order Management System, Transportation Management System, and Booking Management System, all integrated with its ERP system. It also developed the Lenovo Service Control Tower (Spider) for Lenovo.

Customer Portfolio: Enterprise Customers:

• Tier 1 Clients: The Company serves major enterprise clients in contract logistics, including a China-based lithium-ion battery manufacturer, a consumer electronics designer/manufacturer, and a personal computer company. Lenovo is a notable client for its logistics control system.
• Customer Concentration: The five largest customers collectively accounted for 32.6% of total revenues in 2024. One customer alone represented 12.7% of total revenues (RMB71.5 million / US$9.9 million) in 2024, and another accounted for 19.7% of accounts receivable (RMB7.7 million / US$1.1 million) as of December 31, 2024.
• Customer Base: The total number of customers increased by 4.8% from 1,841 in 2023 to 1,930 in 2024.
• Average Revenue per Customer: The average revenue per customer was RMB293 thousand (US$41 thousand) in 2024.

Regional Market Penetration:

• China: Remains the Company's primary market, with a strong presence in Shenzhen and other key provinces.
• United States: Represents a new and developing market, with recent strategic investments in warehousing and customs brokerage operations.
• Europe: Revenue from Europe demonstrated significant growth, increasing by 67.0% year-over-year to RMB88.0 million (US$12.2 million) in 2024, accounting for 15.6% of total revenues.
• Growth Markets: The Company's global freight network extends across six continents and over 80 countries, indicating a broad strategy for international market penetration.

Competitive Intelligence

Global Market Structure & Dynamics

Industry Characteristics: The end-to-end cross-border supply chain solution market in China is characterized by high fragmentation. The Company's business performance is significantly influenced by international commerce trends, e-commerce growth, and broader macroeconomic factors in China and globally. The industry also experiences seasonal fluctuations, with peak order volumes typically observed in the second and fourth quarters (e.g., during major sales events like the June 18 Anniversary Sale and Black Friday Sale), and lower activity around Chinese national holidays, particularly Chinese New Year in the first quarter.

Competitive Positioning Matrix:

Direct Competitors

Primary Competitors: The filing does not name specific direct competitors, only stating that the Company faces "intense competition" within a "highly fragmented" market.

Regional Competitive Dynamics: The competitive landscape varies by major geographic markets, driven by the fragmented nature of the industry and the Company's focus on customized logistics services, omni-bearing supply chain solutions, and digitalization.

Risk Assessment Framework

Strategic & Market Risks

Global Market Dynamics: The Company's business is significantly affected by international commerce, e-commerce, and macroeconomic factors in China and globally. It faces risks from trade restrictions, intense competition in a fragmented market, and potential technology disruption if it fails to keep pace with advancements. Customer concentration is a risk, with the five largest customers accounting for 32.6% of 2024 revenues. The business is also subject to seasonal fluctuations, with surges in Q2 and Q4 and lower activity around Chinese New Year.

Operational & Execution Risks

Global Supply Chain Vulnerabilities: The Company relies on third-party service providers (air, ocean, ground freight carriers), whose financial instability or reduced capacity could adversely impact operations. Supplier dependency is notable, with one supplier accounting for 24.8% of 2024 purchases and 36.1% of accounts payable. Risks include disruptions to warehousing and logistics facilities, inability to secure adequate cargo space, and potential impacts from trade restrictions. Fluctuations in fuel prices, labor market tightening, and technology system failures also pose operational risks. The Company does not maintain product liability or key-man insurance, and faces a potential RMB10.8 million (US$1.5 million) VAT recovery liability due to invalidated supplier invoices.

Financial & Regulatory Risks

Currency & Financial Risks: The Company is exposed to foreign exchange risk from transactions denominated in currencies other than Renminbi, primarily U.S. dollars, and does not employ hedging strategies. It faces credit risks from customer defaults and has reported a net loss of RMB55.5 million (US$7.7 million) and negative operating cash flows of RMB97.4 million (US$13.6 million) for 2024, with an accumulated deficit of RMB127.0 million (US$17.7 million), raising substantial doubt about its ability to continue as a going concern. Additional capital may be required for business objectives.

Regulatory & Compliance Risks: Operating primarily in China, the Company is exposed to legal and operational risks from government regulation, uncertainties in the PRC legal system, and potential intervention by the Chinese government. Future overseas offerings are subject to CSRC filing requirements. Data security and cybersecurity regulations, including the Network Data Security Management Regulations and Cybersecurity Review Measures, pose compliance challenges. While its auditor was inspected in 2023, the Accelerating HFCA Act reduces the non-inspection period to two years. Foreign exchange controls, dividend distribution restrictions from PRC subsidiaries, and international tax strategy uncertainties (e.g., indirect transfers, withholding tax, BEPS compliance) are also significant. Non-compliance with labor regulations and potential penalties for unregistered leases are additional risks.

Geopolitical & External Risks

Country-Specific Risks: Changes in China's economic, political, or social conditions, laws, or governmental policies could materially and adversely affect the Company. Geopolitical conflicts, such as the Russia-Ukraine and Israel-Hamas conflicts, have negatively impacted the global economy, though the Company has no operations in Russia or Ukraine and its shipping routes do not cross the Black Sea.

Innovation & Technology Leadership

Research & Development Focus: Global R&D Network: The Company's R&D efforts are primarily focused on developing proprietary intelligent logistics IT systems. As of December 31, 2024, the R&D team consisted of one employee with over five years of IT industry experience. Innovation Pipeline: Key technology developments include the Warehouse Management System, Order Management System, Transportation Management System, and Booking Management System. Regional Commercialization: The Company has successfully developed and commercialized specialized solutions, such as the Lenovo Service Control Tower (Spider) for Lenovo.

Intellectual Property Portfolio:

• Patent Strategy: While not explicitly detailed, the Company holds 63 registered copyrights, 4 registered domain names, and 5 registered trademarks (including “佳裕达”, “JAYUD GROUP”, “Joyed”).
• IP Litigation: The Company may be subject to intellectual property infringement claims and faces challenges in preventing unauthorized use of its intellectual property.

Technology Partnerships:

• Strategic Alliances: The Company has engaged in strategic collaborations, exemplified by its development of the Lenovo Service Control Tower (Spider) for Lenovo.

Leadership & Governance

Executive Leadership Team

International Management Structure: The executive leadership team includes individuals with significant international and regional experience, such as Co-Chief Executive Officer Alan Tan Khim Guan and Chief Marketing Officer Dun Zhao, supporting the Company's cross-border operations and expansion strategies.

Board Composition: The Board of Directors consists of five directors, including three independent directors (Feiyong Li, Steven Gu, and Jian Wang). The Board has established an Audit Committee (chaired by Steven Gu, an "audit committee financial expert"), a Compensation Committee (chaired by Jian Wang), and a Nominating and Corporate Governance Committee (chaired by Feiyong Li), all composed of independent directors. The Company's dual-class share structure concentrates voting power with existing shareholders, with Mr. Xiaogang Geng holding approximately 38.7% of total voting power.

Regulatory Environment & Compliance

Multi-Jurisdictional Regulatory Framework: Primary Regulatory Environments:

• Cayman Islands: The Company is incorporated in the Cayman Islands and is not subject to income, capital gain, inheritance, or estate duty taxes, nor to withholding tax on dividends or capital.
• Hong Kong: Hong Kong subsidiaries are subject to a profits tax rate of 16.5%, with a two-tiered regime taxing the first HKD2 million of assessable profits at 8.25%. The Group reported no assessable profit in Hong Kong for the periods presented.
• PRC: PRC subsidiaries are subject to a unified Enterprise Income Tax (EIT) rate of 25%, with preferential rates for small low-profit enterprises. The Company is also subject to Value-Added Tax (VAT) at rates ranging from 0% to 13% depending on the service or product. Operations are governed by extensive PRC regulations covering road transportation, international freight forwarding, NVOCC, customs declaration, import/export, foreign exchange, overseas listings, foreign investment, employment, work safety, and information protection on networks (including the Cybersecurity Law, Data Security Law, and Personal Information Protection Law).

Cross-Border Compliance:

• Export Controls: The Company is subject to technology transfer restrictions and licensing requirements for its cross-border operations.
• Sanctions Compliance: Compliance with multi-jurisdictional sanctions and ongoing monitoring is required.
• Anti-Corruption: The Company is subject to anti-corruption, anti-bribery, anti-money laundering, and financial/economic sanctions laws, with non-compliance potentially leading to fines and penalties.
• PCAOB Inspections: The Company's auditor, Marcum Asia CPAs LLP, was last inspected by the PCAOB in 2023. The Accelerating HFCA Act has reduced the number of consecutive non-inspection years for triggering prohibitions from three to two.
• Overseas Investigations: PRC laws, such as Article 177 of the PRC Securities Law and the Provisions on Strengthening Confidentiality and Archives Administration, may pose difficulties for overseas regulators in conducting investigations or collecting evidence within China or Hong Kong.

International Tax Strategy:

• Transfer Pricing: The Company adheres to transfer pricing policies for inter-company transactions, subject to documentation requirements.
• Tax Treaties: Dividends from PRC subsidiaries to non-PRC resident enterprises are subject to a 10% withholding tax, which can be reduced to 5% for Hong Kong resident enterprises holding at least 25% equity under tax treaties.
• BEPS Compliance: The Company is subject to Base Erosion and Profit Shifting (BEPS) regulations.
• PRC Resident Enterprise Classification: There is a risk of being classified as a PRC resident enterprise for income tax purposes, which could result in unfavorable tax consequences.

Environmental & Social Impact

Global Sustainability Strategy: Environmental Commitments: The filing does not explicitly detail specific global environmental commitments, climate strategies, carbon neutrality targets, or renewable energy adoption initiatives. Regional Sustainability Initiatives: The Company is subject to increased scrutiny regarding environmental, social, and governance (ESG) matters and is committed to complying with local environmental regulations in its operating jurisdictions. Social Impact by Region: The Company participates in government social security plans (pension, medical, unemployment, work-related injury, maternity, housing provident fund) for its employees in China. It also provides group accident insurance for employed delivery personnel and some cooperated drivers.

Currency Management & Financial Strategy

Multi-Currency Operations: Currency Exposure:

The Company's mainland China entities primarily denominate revenues and expenses in Renminbi. However, the Group is exposed to currency risk through sales and purchases denominated in currencies other than Renminbi, particularly U.S. dollars, which impacts revenues and results of operations due to exchange rate fluctuations.

Hedging Strategies:

• Transaction Hedging: The Group has not entered into any hedging transactions to manage short-term foreign exchange risk.
• Translation Hedging: No specific strategies are disclosed for managing balance sheet currency exposure.
• Economic Hedging: No specific strategies are disclosed for managing long-term competitive exposure to currency fluctuations.