Order fulfillment is one of the trickiest areas to scale for any ecommerce brand with a global customers
There are several reasons for choosing Hong Kong as a hub for warehousing and distribution. In an introduction on how to strategically use Hong Kong as your global ecommerce fulfillment hub, Romain will discuss the top reasons and their benefits before deep diving into each factor in the coming weeks .
1. Hong Kong is the main global shipping hub in Asia
Hong Kong is a global shipping hub and also the world’s largest air-freight hub. In 2020, Hong Kong International Airport is ranked as the world’s busiest cargo airport by traffic, with a 29.3% year on year growth. Logistically, what this means for ecommerce brands with Chinese manufacturing is the opportunity to access 250 global locations and greater choices of shipping options and carriers, from postal to express to consolidated. Combined together, this leads to increased shipping lanes to Asia, North America, Europe & Oceania at extremely competitive shipping rates
2. Hong Kong is a duty-free port
Trade-friendly regulations make Hong Kong a comparatively easier port to import and export goods from. For example, when importing, you don’t have to pay import duties and taxes. Also, you don’t need to have your own company registered in Hong Kong in order to use a fulfillment centre located there.
3. Hong Kong – China Logistic Advantage
A. Inventory – A common logistics supply chain involves ordering high unit volumes of your product that are then bulk shipped from China to your domestic fulfillment centre. a process which leads to higher upfront inventory costs and import duties and taxes from China to your country of choice.
The smarter alternative is leveraging Hong Kong as your fulfillment hub. Due to the speed of fulfillment from Hong Kong, you are able to keep less inventory at hand, restock quicker through the China to Hong Kong trucking route (which can be as quick as 2 days) and be able to ship from Hong Kong to anywhere in the world, duties and taxes for goods free.
B. Cash Flow – The flow on effect of better inventory management are significant. Not only is there lower upfront capital required for inventory, the cost benefits include savings on the warehousing storage cost, transportation cost from China to Hong Kong rather than bulk shipping to your domestic country and no duties and taxes on Chinese imports.
“When your ecommerce brand serves an international audience, you need a fulfillment hub with a GLOBAL network that can provide cost efficient and fast shipping lanes to customers anywhere in the world.”
Streamline Your Logistics To Support Your Brand’s Global Expansion – Often, an ongoing problem I encounter with clients is the all too familiar: I bulk ship my products from China to my domestic fulfillment centre (US, Europe, Australia, take your pick) and this process allows quicker and cheaper deliveries to my domestic customers. However, I have no economies of scale when trying to fulfill my international orders. For ecommerce brands and crowdfunding project owners, does this scenario sound familiar?
So, what’s the cause of the problem here?
Whilst it makes sense to serve your domestic customers through a domestic fulfillment hub, when your products serve an international audience, you need a fulfillment hub with a strong GLOBAL network that can provide cost efficient and fast shipping lanes to customers anywhere in the world. This is where Hong Kong, with its global shipping lanes, massive carriers options, duty and tax free import status and its’ logistic advantage of being China’s neighbour can be leveraged to become your ecommerce brand’s competitive advantage.
In the upcoming weeks, we will deep dive into Hong Kong’s shipping network, the important as a duty free port and how to leverage its’ geographic positioning with China to be benefit of your ecommerce brand.
Subscribe and stay tuned!
THE OTHER-SIDE OF THE COIN
Should Hong Kong present itself as a strategically advantage fulfillment hub, there still requires an experienced eCommerce fulfillment company that can synergize a global fulfillment network, a tech driven fulfillment platform and decades of cross border fulfillment consulting to bring a holistic logistic solution that ensure fast stress free delivery to your global customers and prioritizes hassle free logistics management for your operations team.
This cross border fulfillment knowledge and experience is key to streamlining the global fulfillment operations for your brand.
When you’re ready to upgrade from your existing fulfillment centre and ensure an expert led, tech driven approach to scaling your global fulfillment, talk to a Floship consultant TODAY.