Cross-border e-commerce is different from physical stores. The goods are not picked up by the buyers themselves, but need to be delivered to the buyers by logistics. Many people are familiar with domestic e-commerce, and many express delivery companies are not very different, but it is more complicated in the field of cross-border e-commerce.
Because cross-border e-commerce merchants do not know much about the express delivery companies in the destination country, the nature of their own business products will also have some requirements for the selection of express delivery companies. At the same time, cross-border e-commerce merchants ultimately face buyers and must consider the needs of buyers.
In this way, for cross-border e-commerce, choosing a logistics model is not a simple matter. This chapter focuses on the logistics model and discusses several common logistics models in the current cross-border logistics field. Through comparison, it guides merchants to choose a more suitable logistics model according to their own situation.
12.1 Choose a suitable logistics model
How can cross-border e-commerce choose a logistics model that suits them? First of all, we must understand what is suitable. The so-called suitable means that it can meet the needs of buyers and save costs for themselves. Secondly, we must understand the overall characteristics of current cross-border logistics. Finally, we must find out what logistics models are available in the field of cross-border logistics and what are the characteristics of these logistics models. Only by clarifying these three aspects and combining the characteristics of their own products and the needs of customers can we choose the appropriate logistics model in actual operation.
12.1.1 Current pain points of cross-border logistics
Compared with domestic logistics, cross-border logistics has many problems to be solved. From the literal meaning alone, we can see several problems faced by cross-border logistics. For example, cross-border logistics requires both exit and entry, so it faces two customs inspections. In addition, long distances, delivery time, problems with goods, and returns are all problems. Let’s talk about several pain points faced by logistics in cross-border e-commerce in detail.
First, customs inspection. For cross-border e-commerce, any import and export goods must face customs clearance issues, that is, goods can only be released after fulfilling obligations such as inspection and taxation when entering and leaving the country.
At present, when online transactions are completed in cross-border e-commerce, there are often some problems in logistics customs clearance. The milder the problem, the more information can be supplemented. The more serious the problem, the more likely it is that the goods will be detained, thereby extending the logistics time and having a negative impact on the timeliness of logistics. Buyers will also be dissatisfied with sellers due to logistics problems, give bad reviews or even refund on the platform, which will cause great losses to sellers.
Second, tax issues. In cross-border e-commerce, foreign trade personnel have to pay value-added tax when exporting goods. Among the current cross-border e-commerce trading platforms, only eBay sellers do not need to pay value-added tax, and sellers on other platforms still need to pay this tax. Therefore, it is still important for these foreign trade companies to master the algorithm of value-added tax, follow the way to pay value-added tax, and be familiar with various foreign trade processes.
Third, transportation costs. Unlike the characteristics of domestic logistics with short cycles and narrow regions, cross-border logistics has a long time cycle and a wide geographical span, and has to face two cost issues of time and freight.
General international express delivery takes at least 3 to 5 days. If buyers are still patient on ordinary days, if it happens to be a special day like Christmas, the buyer’s psychological expectation is still 3 to 5 days, and this period happens to catch up with the golden sales period. Sellers receive too many orders and cannot send them out in time. Buyers choose to return the goods after the psychological expectation time, or even give bad reviews on the platform, and the sellers will suffer great losses.
Another is the issue of shipping costs. Many buyers tend to give priority to free shipping when buying things, which is also a big problem for sellers who have not yet found an international logistics company with a suitable price to cooperate with.
Fourth, after-sales service. The service problems faced by cross-border e-commerce are mainly delivery and return and exchange. Both domestic e-commerce and cross-border e-commerce face the problem of return and exchange. After the buyer buys the product, he may find that it may be different from the psychological expectation, or there may be minor defects in the product quality, or because he does not know the product well enough, which may lead to the buyer’s return and exchange.
For domestic e-commerce transactions, logistics is more convenient and close to the place where the product is shipped, so it is easy to meet the buyer’s return and exchange request. However, for cross-border e-commerce sellers, if there is no overseas warehouse to provide nearby product return and exchange services, and there is no logistics company to establish such a cooperative relationship, it will not be able to meet the buyer’s service needs, which will have a negative impact on the buyer’s shopping experience, thereby affecting the seller’s business expansion.
Another is the delivery problem, which is mainly reflected in the last mile. Compared with the last mile service of domestic logistics companies, I believe many people are quite satisfied with JD.com’s service. Therefore, when sellers choose to cooperate with delivery companies, the last mile service level is an important criterion.