In a recent podcast episode of The Ecomm Manager, host Francois Marchand sat down with Dayu Yang, the CEO of EcommOps, to discuss the best practices for shipping products directly to consumers from China. From cultural differences to quality control, Dayu shared valuable insights and strategies for navigating the complexities of the China supply chain. In this blog post, we’ll delve into the interview highlights and explore the advantages, challenges, and mitigation strategies associated with direct shipping from China.
Listen to the full episode here: How To Make Sense Of China’s Supply Chain For Global Ecommerce Businesses – The Ecomm Manager
Dayu started his journey in the tech industry by working for a computer gaming studio based in Vancouver. After pursuing a business education and working as a consultant, he ventured into the world of ecommerce by launching a smart toy business called Pillar Learning. This experience led him to discover the concept of dropshipping.
Dropshipping is the business model where the company does not purchase inventory in advance; instead, they purchase one item at a time from a wholesale supplier, who then ships the product directly to the customer. Each product purchase is made by the business only after the customer makes a purchase on an online storefront. Essentially, the ecommerce business does not hold any inventory, anywhere. Third party fulfillment, on the other hand, is purchasing inventory in advance and having your fulfillment partner hold your inventory, which is then shipped out through their warehouses to the customer. If you’d like to learn more about the differences between dropshipping and third-party fulfillment, explore this blog post.
After reviewing the pitfalls associated with dropshipping, he realized the enormous growth potential available for China fulfillment companies. China fulfillment allows ecommerce companies to ship products directly to customers around the world from China. Many ecommerce companies at the moment are using sea shipping, or freight shipping, and sending their products from China to local warehouses. This is not the most efficient use of time or money when you’re trying to scale an online business.
Advantages of Direct Shipping from China
There are several key elements for companies to take advantage of when it comes to shipping customer orders directly from China.
First and foremost, it enables businesses to launch products much faster. The lead times between China factory products and a China fulfillment agency like EcommOps can be as little as 24 hours. In short, they receive the products much faster compared to methods like freight.
Additionally, shipping from China to any other country in the world is significantly cheaper compared to shipping from in-country local warehouses. Your business can especially increase margins by using China fulfillment if you are shipping from China to the USA. If you’re considering China fulfillment, contact our team for a quote.
An excellent example of a company leveraging China fulfillment to find success is the ecommerce company SHEIN. SHEIN leverages direct shipping to rapidly iterate on new product launches, thanks to their close proximity to their manufacturing and fulfillment operations in China. Click here to read about SHEIN’s business model and how they incorporate China fulfillment strategies.
Navigating Complex Logistics and Mitigating Risks
To streamline the process of importing products from China, ecommerce businesses must navigate complex logistics. Dayu highlighted the importance of doing thorough research to find reliable factories that offer a balance between quality, price, and production time. Intellectual property concerns and copycats can be mitigated by going through the appropriate legal processes and ensuring IP protection. Businesses should also optimize for customer lifetime value (LTV) rather than focusing solely on individual sales. Understanding the courier lines used for shipping is crucial for optimizing the supply chain.
Challenges and Cultural Differences
In the podcast, Dayu shed light on the challenges ecommerce businesses face when working with China’s supply chain. These challenges include language barriers and regulatory compliance issues.
- Communication issues arise not only due to translation but also due to different cultural communication styles.
- Regulatory Compliance
- Chinese culture tends to read between the lines, assuming others will do the same. To bridge the gap, Dayu recommended working with third-party agents who understand both cultures and can facilitate effective communication and partnership with Chinese businesses. This is where companies like EcommOps come into play!
Dayu’s Advice for Ecommerce Managers and Businesses
Dayu emphasized the importance of recognizing that the supply chain is a crucial aspect of any ecommerce business. While marketing is vital for gaining traction, as businesses scale up, the supply chain becomes equally important in defining the customer experience. Therefore, ecommerce managers and businesses should prioritize building a robust supply chain strategy that can support their growth.
Direct Shipping from China with EcommOps
Direct shipping from China offers several advantages, including faster product launches and cost-efficient international shipping. However, it also presents challenges such as logistics complexities, quality control issues, and cultural differences. By leveraging insights shared by Dayu Yang, ecommerce businesses can navigate these challenges and optimize their supply chain operations. With a strong supply chain strategy, businesses can enhance customer experiences and drive growth in today’s competitive ecommerce landscape.
EcommOps, the Leader in China Fulfillment
If demand for your products is growing, and you’re serious about growing your business sustainably, then it’s likely time to consider partnering with a third-party fulfillment provider. If you already partner (or plan to partner) with China factories, then we would love to talk to you about the unique advantages EcommOps offers our clients, such as:
- Offices in the United States and Shenzhen, China
- Bilingual English/Mandarin support
- Full-suite of fulfillment services, including factory management, inventory management, and order fulfillment services.
To get in touch, you can fill out our online form, and the experts at EcommOps will be in touch to create a fulfillment strategy that’s the perfect fit for your business.