The differences between using FBA warehouses and third-party overseas warehouses and their impact on sellers
Differences in product selection range
FBA warehouses have certain restrictions on the size, weight, and category of selected products, so the selection tends to be small, high-profit, and good-quality products. In contrast, third-party overseas warehouses have a wider selection of products, and you can find a suitable third-party overseas warehouse even for products that are large and heavy. In short, products that can enter the FBA warehouse must be able to enter the third-party overseas warehouse, but products that can enter the third-party overseas warehouse may not necessarily be able to enter the FBA warehouse.
Differences in first-haul services
FBA warehouse will not provide first-leg customs clearance services for sellers. However, some third-party overseas warehouse service providers provide first-leg customs clearance services, and even one-stop services including tax payment and delivery to the warehouse.
Differences in requirements before products are put into warehouse
The warehousing requirements of the FBA warehouse are relatively strict. Sellers are required to affix outer box labels and product labels before shipping. If the outer box or product labels are damaged, the seller will be required to sort them out before entering the FBA warehouse. Another reminder is that FBA warehouses do not provide product assembly services. In contrast, the warehousing requirements of third-party overseas warehouses are not as high as those of FBA warehouses, and they will even provide sorting and assembly services before putting them on shelves.
Differences in distribution of products after entering the warehouse
Amazon defaults to warehousing, and often distributes sellers’ products to different warehouses for mixed storage. Third-party overseas warehouses generally put the goods of the same seller in the same warehouse for centralized management. In addition, FBA warehouses are only available to sellers on the Amazon platform, while third-party overseas warehouses have no such restrictions. As long as the seller has the goods, they can be rented no matter which platform they sell on. In addition, the third-party overseas warehouse also has a transit function. If the seller uses the third-party overseas warehouse and the FBA warehouse at the same time, during the peak season, the goods can be transferred directly from the third-party overseas warehouse to the FBA warehouse, saving time.
Differences in warehousing costs
The cost of choosing an overseas warehouse is not low. Generally speaking, if the volume of goods is large, the cost of using an FBA warehouse is higher than that of a third-party overseas warehouse. However, for products entering the FBA warehouse, sellers can share the warehousing costs by increasing the unit price of the product. If you enter a third-party overseas warehouse, you can lower the product price to attract customers.
Differences in product promotion support
By choosing FBA, the Amazon platform will increase the exposure of the seller’s products, such as improving the ranking of the seller’s products, helping sellers grab the golden shopping cart, etc., which will help increase the traffic and sales of the seller’s store. However, if you choose a third-party overseas warehouse, it is impossible for a third-party overseas warehouse service provider to provide a platform for sellers’ products or increase exposure on the platform like Amazon does. Sellers need to do their own on-site and off-site promotion to improve store performance.
Differences in handling negative reviews of products after shipment
If you use FBA but customers leave negative reviews due to logistics, Amazon can remove the negative reviews, so sellers don’t need to worry. If you use a third-party overseas warehouse and have negative reviews due to logistics, the third-party overseas warehouse service provider cannot provide after-sales and complaint services. Even if it does, it may not be able to successfully remove the negative reviews left by customers.
Differences in risks of cargo storage
Putting goods in overseas warehouses has potential security risks. Placed in the FBA warehouse, its security is associated with Amazon account security. If there is a problem with the products sold by the seller on Amazon and the account is closed, the goods placed in the FBA warehouse will also be temporarily seized. If it is stored in a third-party overseas warehouse, there is no need to worry about this risk.
To sum up, whether you choose an FBA warehouse or a third-party overseas warehouse, they have their own strengths and weaknesses. Sellers should choose based on their actual situation.