For cross-border e-commerce sellers, logistics is a barrier that must be overcome in order to obtain higher profits, and the overseas warehousing model is an effective means to break down the barrier. Before trying to do overseas warehousing, it is very necessary to understand its advantages and disadvantages.
1. Advantages of overseas warehousing
(1) Lower logistics costs: Sellers ship directly from overseas to customers, which is equivalent to domestic express delivery, and the cost is lower than shipping from China to foreign countries.
(2) Faster delivery time: After the first-leg transportation solves the complex problems of transportation, customs declaration, and customs clearance, there is no need to worry about the customs declaration and customs clearance of items in the warehouse. After receiving the order, it can be shipped at any time.
(3) Better warehouse management experience: Overseas warehousing is equipped with the most professional management personnel for sellers, which effectively solves the cargo management problems of warehouse managers.
(4) More convenient order processing: Orders and shipments are synchronized to realize automated batch processing of orders.
(5) Clearer inventory management and inventory counting: The current sales volume and remaining inventory are automatically displayed by the system, and the logistics cost of each order is clear at a glance.
(6) Free ERM warehouse management platform: Sellers only need to click the mouse in front of the computer to issue order delivery instructions, and the professional team of overseas warehousing will complete the delivery on behalf of the seller.
(7) Automatic and efficient return processing process: Customer returns due to various reasons can be directly returned to overseas warehousing, eliminating the cost, timeliness, abandoned goods and other losses of domestic and foreign double clearance.
(8) Sellers can use the lowest investment and the shortest time to conquer overseas markets, and can accumulate more resources to expand other target markets and expand their business scope.
(9) Overseas warehousing can help sellers expand sales categories and break through the development bottleneck of “big and heavy”.
2. Disadvantages of overseas warehousing
(1) Invisible and intangible goods: Because all inventory is on the other side of the earth, if sellers want to see their inventory, then it may not be suitable to use overseas warehousing. To a certain extent, the degree of trust of cross-border sellers in overseas warehousing services is a critical factor. It is recommended that sellers can first send a small amount of goods to overseas warehousing to try and feel it.
(2) Warehousing cost: Sellers need to first calculate the cost of the current delivery method, and then compare the cost of using overseas warehousing, especially the warehousing cost of the goods sold during the off-season. If the order volume in a month is too small and there is no actual advantage in terms of profit, then it is not suitable to do overseas warehousing. Cost issues are always the primary factor that sellers consider. It is recommended to choose to use overseas warehousing during the peak sales season of the goods sold.
(3) The nature of the goods sold: Overseas warehousing requires a certain amount of inventory to sell. If the seller’s goods must be produced according to customer requirements and cannot prepare goods in advance, then it is not suitable to do overseas warehousing. Not all products are suitable for overseas warehousing. It is best to choose hot-selling items with fast inventory turnover, otherwise it is easy to have inventory pressure. At the same time, overseas warehousing places higher requirements on sellers in terms of supply chain management, inventory control, and sales management.