Alibaba and Amazon have given customers around the world lofty expectations for fast, inexpensive delivery. In the United States, Amazon has set the bar high with free two-day delivery for its Prime customers. In China, Alibaba’s Tmall and Taobao have made same-day delivery the norm. So how do you meet these expectations of fast, inexpensive delivery for your global e-commerce shoppers?
Regardless of the destination, international shipments that start in the United States are costly. When packages cross borders, customs and duties add another level of cost to the customer. Shipping internationally also means a typical wait time of at least five business days. Also, if the customer is not satisfied, there’s the matter of international returns and those additional shipping costs.
Global e-commerce merchants need to have a localization strategy to get products closer to their customer base. One way is to set up a subsidiary in the country or countries they ship the most to. But then companies would need to secure warehouse space, office space, and hire employees in each market they want to do business in. That can get costly and include substantial bureaucratic red tape.
A simpler solution is to use a third-party warehouse and fulfillment provider in the countries where you have a significant amount of global e-commerce business. Storing inventory with a provider in your most-popular global e-commerce destinations will help you save on shipping costs and get packages to your customers quicker. What’s more, you save money by having low start-up costs. For example, you don’t need to hire staff or own equipment, which means fewer fixed costs. You also improve customer satisfaction because you deliver faster to the local market, and because customs, duties, and VAT will be pre-paid.
And, most important, you can focus on selling because your third-party warehouse and fulfillment provider takes care of your picking, packing, shipping, and inventory management.