1.   Amazon’s FBA service gave birth to FBA freight forwarding.

First of all, what is FBA?

For the convenience of description, we take the example of products made in China exported to Amazon in the US. Amazon’s FBA services in Europe, Australia and Japan need to accomplish similar work.
   FBA is short for fulfillment by Amazon. It is a service provided by Amazon, including warehousing management, packaging, delivery and after sale service, so that the seller can focus on sales! It is worth noting that a large part of the products sold on Amazon in the US are produced around the world, rather than in the US. So when the goods produced outside the US are transported to the US by sea, air, etc., and enter the warehouse designated by Amazon, Amazon FBA service will handle all the local packaging, storage management, transportation and return.
  As explained above, FBA service starts upon the arrival of cargo at the warehouse designated by Amazon.
  Therefore, to initiate the service of Amazon FBA, the seller shall first solve the problem of how to import the products into the US. These problems naturally fall on the so-called Amazon FBA freight forwarder.Naturally we arrive at the following definition of FBA freight forwarder.
  Amazon FBA freight forwarder is a freight forwarder who is specially responsible for delivering products sold on Amazon’s website from Chinese factories to Amazon’s warehouses in the US. All work involved in the process is included in the service scope.

2.   Business scope of FBA freight forwarder    

In short, to deliver the goods to Amazon’s FBA warehouse, the following tasks should be completed:

1) Domestic transportation and customs clearance of goods in China

For this part of service, FBA freight forwarder will generally provide warehouse, which is mainly used to gather the goods to be sent by each seller into the warehouse, receive, tally and classify the goods according to the Amazon warehouse label, and then carry out container shipping or air transportation according to different transportation modes and different Amazon warehouses. At the same time, the customs clearance procedures for the export of these goods shall be carried out.          

2) International transportation from China to the US

Generally speaking, based on the timeliness or importance of the customer’s goods, the freight forwarder will adopt two methods: air or ship.Either way, the destination to the US is Los Angeles. Of course, if shipping by sea to US, the cargo may go to different wharfs eight Los Angeles or Long Beach, which is decided by the shipping company.

3) US import customs clearance and transportation

After the goods arrive at the airport or wharf, the freight forwarder needs to carry out import customs clearance, and then start to dispatch the goods according to their respective Amazon warehouse delivery address. The delivery methods are as follows:

a) Express, mainly FedEx or UPS
b) Truck
c) Delivery of the whole container.       

3 FBA transportation modes

China and the US are separated by a vast Pacific Ocean. There are two main options for transporting products from China to the US, one is by sea, the other is by air. Sea transportation is from China’s coastal ports to the U.S. coastal ports, while air transportation is from airports to airports. However, Amazon’s warehouse can’t be right next to the port or airport (even if nearby, further transportation is needed from port to the warehouse). At present, the main operation is to send via express companies, such as UPS, to Amazon warehouse. So we can send Chinese goods to Amazon warehouse in the US thru the following five modes.

1) International shipping container LCL + domestic express delivery to Amazon FBA warehouse

The multimodal transport mode can be divided into:

a) Domestic transportation of Chinese products from the place of shipment to the export warehouse of Chinese port.

b) The goods are integrated in the warehouse and loaded into containers for international sea transportation from Chinese ports to American ports.

c) After arriving at the U.S. port for customs clearance, unpack in the U.S. import warehouse, and then send it to the designated Amazon warehouse by express delivery.   

Main features:       

a) The main route is sea transportation, so the cost can be controlled       

b) The sea transportation time from Chinese port to American port will be longer, and the fastest ship, such as Matson, will take at least 13 days from Shanghai, China to LA, USA. Other ships take about 15 days.

 2) International shipping container full container transportation + truck transportation to Amazon FBA warehouse

If the Amazon seller has a large volume of goods, he may integrate his goods into the whole container transportation. It is conducive to cost control and cargo safety. In this case, the steps can be broken down into:

a) Domestic transportation of Chinese products from the place of shipment to the export warehouse of Chinese port.

b) The goods are integrated in the warehouse, loaded into containers, and transported by international sea from Chinese port to American port.

c) After arriving at the U.S. port for customs clearance, the whole container is directly transported to Amazon warehouse by truck.

The following conditions must be met to adopt this method.

a) The seller has a lot of goods, which can fill at least one 20gp container.

b) The seller’s goods need to be delivered to the warehouse, which is a warehouse of Amazon. If the goods are to be sent to multiple Amazon warehouses, it is likely to incur a lot of additional costs. For example, demurrage charges, waiting charges, etc.

3) International air transport + US express delivery to Amazon FBA warehouse       

The multimodal transport mode can be divided into:

a) The delivery place of Chinese products to the foreign trade export warehouse of China’s airport;

b) The goods are integrated in the warehouse and airlifted to airports in the US;

c) After arriving at the U.S. airport for customs clearance, unpack in the U.S. import warehouse, and then send it to the designated Amazon warehouse by express delivery.

Main features:
a) The goods can arrive at Amazon warehouse in the US quickly, because air transportation usually takes one day to get from China to the US airport.
b) The price is relatively expensive, because the cost of air freight is relatively high.

4 International air transportation + truck delivery in the US to Amazon FBA warehouse

If the same as the previous mode, i.e. international transportation is also by air, but the seller’s goods are many, and delivered to only one or two Amazon warehouse addresses, domestic transportation in the US can directly use trucks, which will be better in cost and timeliness than express delivery.

5) International express directly from China to Amazon FBA warehouse   

 This situation is relatively rare, mainly due to two reasons: First, the freight cost is relatively expensive. The second main problem is that the seller needs to directly handle and solve the customs clearance problem of imported goods in the US. Therefore, this mode is only suitable for the transportation of a small number of goods with low value.

4.   How to clear customs in the US?

It is well known that the goods shipped from China are cleared in the US, and all importers need to have bond. But when the Amazon goods are sent to the US from China, in fact, the importer is the seller’s own shop in Amazon. So how to solve the import customs clearance problem? Generally speaking, China’s freight forwarders engaged in FBA services adopt the following two ways.

1) The formal way is to purchase bond in the name of the exporter and clear the customs with the same.

This way reflects the real situation of logistics and trade. The seller transports the goods to the US through the freight forwarder, and then uses its own bond to pay taxes when the US clears the customs. After the customs clearance, the seller transports the goods to the Amazon warehouse.

2) Forwarders use their bond to clear customs for sellers.       

In many cases, the seller’s goods are relatively small, plus they are not very clear about the operation process of bond, or the seller is an individual rather than a company. Another reason is that if you use the forwarder’s bond, the seller’s cost will be lower than the first formal way. This way of quoting is usually how much a kilo to Amazon warehouse, including freight and import duty. The advantage of this way is cheap and simple. But there are also great risks. If there is a customs inspection and the amount of customs declaration provided by the freight forwarder is too low, there is a risk of goods loss.

 5.   How to choose the right Amazon FBA freight forwarder?

Generally speaking, according to seasonal and timeliness factors, the seller will choose express delivery or air delivery to supplement those products that are in short supply or very popular. For mass replenishment, sea containers or sea LCL will be used, which are suitable and stable for mass transportation.

There are a lot of freighters who do FBA service in Chinese market, so how to choose the right one? We suggest starting from the following aspects:

1) Examine the professionalism of their business

In the process of making an inquiry with them, it is necessary to judge whether the other party is familiar with some rules of Amazon transportation. A professional freight forwarder must ask about the goods and the necessary information such as warehouse. If the forwarder doesn’t ask, but offers the price directly, then you must be careful.

2) Don’t simply pursue the low price

Many freight forwarders will compete with low price in order to collect goods. But if the price is very low, the risk will be great. For example, they will deliberately report taxable goods as non-taxable goods, or reduce the amount of tax to reduce their operating costs. The risk is that once the customs check, the goods will be deducted or fined. It will bring you unnecessary losses.

3) Compare as many companies as you can       

Compare more companies, ask more similar questions, check their answers, and combine your previous experience, you sure will make a reasonable conclusion.

6 Final words

Thanks for your patience to go here,I hope this blog can help you understand Amazon freight forwarding. If you need any advice, please contact us, and we will give you a targeted reply as soon as possible.