Detailed explanation of Amazon shipping methods and logistics cost optimization strategies
On the Amazon platform, sellers can choose from a variety of delivery methods, which are mainly divided into two categories: FBA (Fulfillment by Amazon) and self-delivery. This article will discuss the advantages and disadvantages of these two shipping methods in detail, and introduce some common logistics methods for self-shipping.
FBA shipping method
FBA shipping refers to the seller sending the goods to the Amazon operation center in advance. When the buyer places the order, Amazon is responsible for handling a series of logistics services such as warehousing, picking, packaging, distribution, customer service, returns and exchanges. The advantages of this approach are obvious, including but not limited to:
- Fast logistics: able to meet the needs of Prime members for quick delivery;
- Professional customer service: Amazon’s professional customer service team handles various after-sales issues;
- Delete negative reviews: Negative reviews caused by logistics issues can be removed.
However, FBA also has some disadvantages, such as higher overall costs, increased costs caused by buyers’ unreasonable returns, and problems such as returns that can only be returned to the FBA warehouse.
Self-delivery method
Self-shipping covers two situations: shipping from third-party overseas warehouses and shipping directly from China.
Shipping from third-party overseas warehouses
This method requires the seller to store the goods in a third-party overseas warehouse in advance. After the order is generated, the overseas warehouse is responsible for packaging and delivery. Compared with FBA, this method has lower warehousing costs and helps expand the local market, but it also increases the pressure on inventory management and supply chain.
Shipping directly from China
Sellers handle each international order individually, which can significantly reduce stocking costs and provide greater flexibility. However, the lack of Amazon traffic support and customer experience issues that are more susceptible to logistics are its main drawbacks.
Suggestions on logistics method selection
For self-shipping sellers, it is crucial to understand the characteristics of different logistics channels:
- Postal Parcel: Wide coverage, low prices and strong customs clearance capabilities. Including international EMS, international E-mail and flat mail/registered small package and other options.
- International Express: Such as DHL, Fedex, UPS, etc., which are fast and safe but relatively expensive.
- Special Line Logistics: Transport to specific countries via air charter, and then local partners complete the last mile delivery.
- Overseas warehouse: Although similar to FBA, under certain circumstances (such as during the epidemic), it may become a more cost-effective option.
In order to further reduce costs, sellers can also consider joining the Amazon SFP program or adopting a strategy that combines FBA with overseas warehouses to balance the relationship between service quality and financial expenses.
No matter which shipping method you choose, it is important to make a comprehensive consideration based on your own business characteristics to ensure that you can provide high-quality services and control costs.