Table of Contents
What Is An Overseas Warehouse?
“Overseas warehouse” means a storage facility established overseas. That is, the seller will first batch of goods will be prepared at the overseas warehouse closer to the consumer after the consumer placed an order, directly from the overseas warehouse and sent to the hands of consumers. It is a kind of advanced preparation mode.
The “overseas warehouse model” refers to domestic enterprises transporting goods to target market countries in bulk, storing them in local warehouses, and then picking, packing, distributing, and returning them directly from the warehouses after local sales orders are generated.
Since the outbreak of the overseas epidemic in 2020, a large number of overseas offline retail markets have been closed, consumers have turned to online shopping and consumption in the “home economy”, cross-border e-commerce hoarding demand has surged, FBA warehousing capacity is seriously insufficient, eBay, Shopify, and other non-Amazon platforms have also ushered in rapid development, coupled with the direct shipping mode under the epidemic Unstable timeframe. Let the third-party overseas warehouse usher in a wave of “burst tide”, the whole industry has been in rapid expansion.
Ministry of Commerce data show that the number of overseas warehouses in China exceeded 1,000 in 2019, and 1,800 in 2020, with a growth rate of 80% and a total area of 12 million square meters; the number will break through 2,000 in 2021, with a total area of 16 million square meters.
The Reason Why Overseas Warehouses Can Develop Rapidly
It is because compared with direct shipping, overseas warehouse shipping can achieve faster timeliness and more stable delivery service. Local shipments can reach buyers in 1-3 days, and there is no risk of uncertainty in the first journey. Especially in the “home” environment and mentality, it can significantly improve the logistics experience of consumers; Secondly, the premise of controlling the amount of stock can greatly reduce logistics costs, especially for heavy sellers, overseas warehouse mode is undoubtedly the optimal solution for stocking.
The Inevitable Defects Of Overseas Warehouse
1. Advance stocking will take up funds for a certain period of time, such as sellers appearing to be too optimistic about market forecasts, deviations in product selection, backlog and stagnant sales, etc., in the long-term bear warehouse rental costs at the same time, may affect business capital turnover.
2. The explosion of the overseas warehouse market makes a large number of cross-border players see the huge demand and space for overseas warehouses. A large number of players are optimistic about the market forecast and enter the market without industry experience, giving birth to the situation of wild growth of overseas warehouses in 2020.
The Future Development Trend Of Overseas Warehouse
As the market calms down, the supply of overseas warehouses exceeds demand, some companies are forced to withdraw from the stage, and the industry is reshuffled. New brand owners and sellers integrating industry and trade have put forward higher quality, more stable, and more compliant demands. This requires overseas warehouse service providers to continuously improve their internal and external comprehensive strength, maintain their own evolution, develop more categories of business, and create more personalized solutions for supply chain full-link collaboration centered on customers.
The overseas warehouse is not only a warehouse but also a supply chain system with a very high threshold. Intelligence, refinement, integration, and informatization are the main themes of the future development of overseas warehouses, and the leading overseas warehouse service providers are committed to providing more stable, safer, and more compliant “end-to-end Rui” services, which will become the scarce resources of the industry.
If you want to operate an overseas warehouse well in the long term, you need strong financial strength, rich experience in site selection, refined warehouse management, overseas team formation, localized operation ability, a smooth information system, and other elements.
Veeddy dropshipping has a number of experienced and mature overseas warehouses if you have a need welcome to contact us.