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I am based in Japan and US customers are turned away by expensive international shipping rates to the US. Would it be a good idea (is it being done) for me to send some inventory to a US fulfillment service (FBA, Shipwire etc.) so that shipping will be domestic? Or will the cost of shipping to the service provider plus the service's fees make my costs higher?

I guess I'd like to know if international sellers do this, as this would be a sign that it is feasible. I am a low-volume start up by the way.

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2 Answers

If your customers are only in the USA then fullfilment services will benefit your business a great deal. Here is why:

Your customers wont have to deal with customs, or customs delays.

Your customers will have to wait much less time for their products to be delivered resulting in better customer satisfaction and results.

You can look into logistics processing with UPS or fulfillment by amazon. Both have great reputations depending on your needs. Amazon is a good fit because it is closely tied in with their amazon marketplace product, allowing you to sell to millions of amazon customers.

The main concern you should have is getting your products to your logistics or fulfillment company. Its much cheaper to send 1 or 2 containers full of your products to your fulfillment facility rather than ship individual orders from japan.

Another approach you may look into is either whole selling your products to a USA partner that will take care of the eCommerce end here. I am sure you could find the right partner who would absorb the cost of buying your goods (at a lower cost than what you retail them for), work with you to have them shipped to the usa to a warehouse, and then run and fill orders here for their own profit.

The above might be a simpler approach depending on your product.

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It will reduce shippnig costs IF YOU ARE LARGE ENOUGH.

Mostly:

  • Local sipping is faster / less expensive. Packet instead of DHL. International 24 hour shipping is expensive.
  • On the other hand, it also emans you can ship international on slow large blocks (container on ship) instead of individual custoemrs by air freight.

OTOH: This means you need to ship by container. Which takes weeks.

Whether it makes sense depends on volume you ship, and content. For example software is high value, low weight and with proper packaging (jewel case, dvd case) easily shippable as documents. A computer / tv is low value high weight (value per kg is low), so you run HIGH charge in 24 hour shipping. THis is where fullfillment centers may come in very handy.

Your main low volume problem is: Setting is all up + base costs will eat into yuor margin. You may find it is cheaper to air fright one tv per week than to store a container at a local fullfillment center.

Last time we talked fuillfillment with a customer in a projet he was talking about storing 5-6 container of goods at the fullfillment company. And that was small.

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