Many new Amazon sellers do not know how to choose a logistics model. This article mainly introduces the advantages and disadvantages of third-party overseas warehouses for novice sellers.
1. Advantages of third-party overseas warehouses:
1. A stable supply chain helps increase sales. Relevant data show that among similar products, the sales volume of goods shipped from overseas warehouses will be several times higher than that of goods shipped directly from China. It helps to increase the profit margin of a single product, improve the pricing level of sales goods, and achieve competitive local sales;
2. The centralized transportation method adopted by overseas warehouses greatly reduces the average freight of a single product, breaking through the restrictions on the weight, volume and price of goods. If an overseas warehouse is used, it will have obvious cost advantages, which also effectively reduces the cost of logistics management;
3. The return and exchange processing of overseas warehouses is efficient and convenient, making the use of overseas warehouses more flexible. If there is no quality problem, the overseas warehouse can change the label or repackage, which is conducive to reducing the seller’s losses and improving customer satisfaction and experience;
4. Third-party overseas warehouses generally have no platform restrictions. Regardless of which platform you sell on, you can use overseas warehouses. Generally speaking, Chinese people are stationed in foreign warehouses, which facilitates communication and processing;
5. The warehousing requirements of third-party overseas warehouses will not be as high as those of Amazon FBA warehouses. Generally speaking, they will provide services for sorting and assembling products before listing. In addition, if the outer box is damaged, the overseas warehouse can also help replace the box, but it will cost an additional fee.
2. Disadvantages of third-party overseas warehouses:
1. The seller has stricter requirements for product selection. Using products delivered by overseas warehouses, on the one hand, guarantees quality, and on the other hand, meets the needs of local buyers. The inventory pressure is very high. Once there is a slight error in the selection or market grasp, it will lead to unsalable goods and poor sales. A large amount of goods are squeezed in the warehouse, and the goods are difficult to handle overseas, which is a dilemma;
2. Poor capital turnover, batch stocking to overseas warehouses. A large amount of capital investment, such as stocking funds, logistics funds, warehousing funds, etc., leads to a long capital return cycle. Once the seller’s capital turnover is poor, it is easy to cause a break in the capital chain;
3. Poor overseas controllability. Overseas warehouses are greatly affected by uncontrollable factors such as local policies, social factors, customs, and natural factors. For example, when goods are seized during import, the goods in the local warehouse are seized and confiscated, which has a great impact on the seller.