As a pioneer of cross-border e-commerce in Zhejiang, Chengkai has established a team to do cross-border Amazon and eBay. Although the volume is relatively large, the cross-border logistics cost from China to the destination country has always accounted for a high proportion of the cost of goods, and traditional cross-border logistics often loses items, which is a very bad customer experience.
Mr. Zhang has always been familiar with overseas warehouses, because when he was studying abroad in his early years, he rented an American underground garage to purchase goods from China and sold them in the United States. Mr. Zhang said that this is probably the most primitive model of overseas warehouses. After 2015, China’s cross-border e-commerce has undergone major market changes. Branding and supply chain efficiency have become core competitiveness. Using the strong capital strength of his own brand enterprise, Mr. Zhang decisively chose the overseas warehouse model, registered an American company, established an overseas warehouse in the United States, and even installed a production line directly in the warehouse to produce and sell directly locally. Although such an overseas warehouse model requires huge initial investment, the most direct bonus after it is straightened out is that the cost of products is greatly reduced. Compared with the traditional model of shipping within China, the price of products exported as a whole through container shipping and sold in the destination country has dropped by 40% to 60%. In addition to lowering costs, he also developed value-added services through overseas warehouses, opened up and seized the local market. Because overseas warehouses and localized enterprises directly communicate with end consumers, they provide the best customer experience and make business operations more flexible, so the order volume continues to grow. At the same time, because the company sells in the destination country, it avoids trade barriers in some national markets.