As an Amazon FBA seller, you want to move your products from production to Amazon warehouses as quickly and cost-effectively as possible. But when your goods are manufactured in one part of the world, and you’re selling in a marketplace on the other side of the globe, combined with the supply chain problems, you need an effective solution for streamlining your international Amazon supply chain. This is where Amazon Global logistics can make the most sense for your inbound shipping costs and ensure your products stay in stock.
Before we dive into what Amazon Global inbound shipping is, how to set it up, and how to use it, let’s take it back to the beginning…
Traditionally, when brands are importing goods from Asia, they need large amounts of infrastructure or third-party logistics carriers (3PL) to manage their shipments. This includes prepping, labeling, transporting to the port, handling customs, and then shipping the goods via sea. Unless of course you’re up for paying significantly more for the faster delivery of air travel.
Once products land in the US, there are many touchpoints to prepare or store products until they can be divided and transported to their respective FBA warehouses. It’s a long and complicated process that can result in tied up inventory. We all know that out-of-stock statuses lead to revenue losses and negative impacts on a listing’s ranking.
Global Supply Chain Due to the Pandemic
Since the pandemic started in 2020, supply chain problems have escalated to new heights, causing many headaches. Ports were backed up. There were driver and trucking equipment shortages. Then to make matters worse, Amazon Quantity Limits (AQLs) took effect. AQLs limited how much inventory sellers can send into Amazon Fulfillment Centers – learn more about that here.
Before AQLs, brands could send in significant quantities of inventory. Now, sellers have an account inventory storage limit by storage type. While these limits are getting better, this often leads to stock outs on items in Prime.
What is Amazon Global Logistics?
The Amazon Global Logistics (AGL) program came to be in 2005. It provides sellers the ability to directly import from China to the USA, UK, EU, and Japan. In addition to using dedicated charter flights, Amazon acquired its own fleet of ships and planes to streamline the process.
Amazon has overall reasonable inbound rates. Their transportation costs will often be less than what you would pay if you arranged your own freight. Overall, this program makes the importing process quicker and more affordable for many brands and comes with these benefits:
- Fewer Touchpoints: AGL provides a direct path from foreign production sites to FBA warehouses. It also eliminates the need for extra touchpoints, like temporary storage, along the way. AGL delivers an end-to-end solution that encompasses local pickup, palletization, labeling, cargo insurance service, and customs clearance at origin and destination.
- Better Lead Times: This program reduces the time inventory is tied up within the supply chain. You don’t have to handle the logistics for when your freight lands, store it and move it to FBA.
- Reduced Inbound Shipping Costs: Enjoy reduced costs with fewer touchpoints. You don’t need a warehouse to receive your inbound products or hire a 3PL to handle it for you. AGL gets your products directly to FBA and defaults inventory to a single fulfillment center. This avoids the expenses that arise from shipping to multiple fulfillment centers.
Who Can Use Amazon Global Shipping Services?
You can use AGL for all product categories, with the exception of temperature-sensitive items. It’s certainly a cost-effective solution for shipping many products, and not surprisingly, oversized items benefit the most. Amazon also offers a user-friendly process for booking and tracking shipments in your Seller Central.
If your items have seasonal FBA storage restrictions, such as groceries and meltables, you can’t use AGL. This is because these items will not be temperature-controlled during transit, so they could spoil.
Global inbound shipping requires a shipping plan when your goods leave their international location. This means it will tie up available inventory capacity within your Amazon account. If your brand has limited storage capacity, the opportunity cost needs to be carefully considered.
Amazon Global Shipping Options
AGL allows you to choose which shipping method works best for your brand. Is speed or cost-saving your top priority. Options include:
- Standard Ocean: Ship via standard full container load (FCL) or less than a container load (LCL) with Amazon managed consolidation.
- Fast Ocean: Expedited ocean-faring services that are faster than Standard Ocean but cost less than Air.
- Air: For when you need speed! Amazon’s dedicated charter flights see a typical transit time from origin to FBA of only 7 days.
Amazon Global Logistics: Where to Begin
We’ve put together this summary the steps to take:
- You must register for an Amazon Global Logistics account.
- Set up an inbound shipment as you normally would.
- During setup, you will link your Global Logistics account and then choose how you want to pay for inbound shipping. Payments will deduct from your Seller Account Disbursement.
- You will need to provide additional details, including import records and proof of purchase, bond, importer details, and content details.
- Once you complete the Global logistics and importer setup, you are ready to return to the shipping plan to finalize the shipment.
You can access Amazon’s complete guide on how to set up your Global Shipping Services Account at this link here.
The more Amazon can control the importing process for its FBA sellers, the more it benefits its marketplace, merchants, and most importantly, its customers, who get the items they need delivered to their doorsteps as soon as possible. Amazon Global Logistics streamlines the supply chain process for all involved, making a sensible solution for many sellers.
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From strategy to brand management, advertising to logistics, we are a trusted partner for scaling DTC brands. Contact us to learn more about our suite of services.
Now that you’ve read all about inbound shipping, we recommend checking out this article: Amazon FBA Storage Fees – What You Need to Know.