By and large, China remains the best source of goods to sell. And if you are currently an Amazon FBA merchant (or are planning to be one), the country should be on top of your list for potential suppliers.
But apart from getting the lowest possible price for supplies, FBA merchants should always look at other sources of potential savings. That includes shipping.
Outlined here are some of the steps that you need to undertake to save on costs, maximize your earning potential, and avoid the potential hassles associated with shipping products from China to the USA.
Decide how you want the goods shipped to Amazon
Here, you have two options: direct or indirect shipping.
In the first option, your goods are shipped directly to Amazon’s warehouses, where the products will be packed and labeled. In the second option, the goods are sent to you directly, and you will need to pack and label these before sending these out to Amazon.
Learn the pros and cons of each option while taking into account your company’s available resources and capabilities as well as the available shipping routes.
Choose a mode of shipping
Another critical factor that you need to evaluate is the mode of transportation. There are three basic options to choose from: express, air freight, and ocean freight.
Express shipping is ideal if you are ordering a small number of goods. Do be aware that although this option is relatively simple, you could end up paying more.
Air freight is recommended for shipments that weigh between 50 and 100 kilograms. Airfreight is cheaper than express shipping and has shorter transit times. However, the processes involved are more complicated.
Ocean freight offers the lowest cost, but the tradeoff here is slow transit time. Merchants can choose between less-than-container-load or full container load when they opt for ocean freight. Like air freight, ocean freight requires the assistance of an experienced freight forwarder.
Outline the incoterms
Incoterms refers to the agreement you enter with your supplier in terms of the shipping responsibilities of the parties involved. Among the different incoterm options, the Free On Board or FOB incoterm is the most ideal for most merchants.
In an FOB, the supplier shoulders the responsibilities, including the costs and clearances associated with moving the goods from the warehouse to the airport or shipping port.
Obtain freight quotes
Get as many quotes from freight forwarders, allowing you to make an objective assessment of which company to choose. In choosing a freight forwarder, do not base your choice solely on price. This is particularly important if you are planning to receive the goods first before moving these to Amazon’s warehouses.
Getting your shipment cleared by customs
This process starts long before your shipment arrives. For shipments that cost over $2,500, you have to declare these formally, and you need to submit a customs bond. The completion of these requirements needs to be done before your shipment arrives in the United States.
For goods valued below $2,500, you can submit either a formal or informal customs declaration. Should you opt for an informal declaration, you have to provide the necessary documents to the US Customs and Border Protection or CBP.
If you choose to declare formally, your customs broker can make the declaration and obtain a bond for you. If your shipment is transported by air, the paperwork can be filed after it has left the country of origin. On the other hand, if the cargo is transported via sea, the paperwork should be submitted a few days before its expected arrival in a US port.
Once the declaration has been filed, you need to wait for the CBP for its clearance. In some cases, the CBP may need to examine the shipment. The taxes and duties are paid for by your broker on your behalf.
Delivery to Amazon
Once your shipment has been cleared and offloaded, it can be sent directly to your warehouse, an intermediary, or to Amazon, depending on your choice.
Due to the fact that several steps are involved, it is crucial for merchants to fully understand the processes involved in each of these steps as well as all the available options. Only with a thorough understanding of these steps and options can you maximize your earning potential while reducing the chances of encountering the associated hassles.