Third-party overseas warehouse companies are mainly international logistics and freight forwarding companies. They have strong and professional international logistics service capabilities and focus on operating logistics services for cross-border sellers. Professional companies that have been involved in overseas warehouses earlier in China include: Wanyitong, Export Easy, China Post, 4PX Delivery, Feiniao International, etc. From the perspective of export situation, the demand for overseas warehouses is becoming more and more obvious. Many sellers call for more overseas warehouse value-added services such as processing, finance, and customer service.
1. Advantages of third-party overseas warehouses
The advantages of third-party overseas warehouses are mainly as follows.
(1) It helps to increase the profit margin of a single item. eBay data shows that the average selling price of goods stored in overseas warehouses is 30% higher than that of similar goods shipped directly.
(2) A stable supply chain helps to increase sales of goods. It can provide full industry chain services including logistics distribution, warehousing management and customs clearance, greatly improving competitiveness. Among similar goods, the sales volume of goods shipped from overseas warehouses is 3.4 times that of goods shipped directly from mainland China.
(3) The centralized transportation model breaks through the restrictions on product weight, volume and price, which helps to expand sales categories; it greatly reduces the average freight cost of a single item, especially when the weight of the item is greater than 400 grams. The price advantage of using overseas warehouses is more obvious, which effectively reduces the logistics management costs of e-commerce, thereby increasing the profit margin of a single item.
(4) Stable sales and more and better buyer feedback will improve the seller’s account performance. eBay data shows that using overseas warehouses can increase the seller’s logistics praise rate by 30%.
(5) Third-party overseas warehouses can avoid the risks brought about by uncertain links such as laws and regulations, industry policies, taxes and overseas personnel management.
2. Disadvantages of third-party overseas warehouses
Third-party overseas warehouses also have disadvantages, such as inaccurate inventory forecasts may lead to unsalable goods; if there are omissions in cargo tracking, items may be lost; the poor localization services and team management of overseas warehouse service providers themselves will also affect the customer’s service experience.