Are Self-built Overseas Warehouses and Distribution Networks for Sellers Opportunities or Traps?

Cross-border e-commerce sellers have always tried to enter the logistics field, but very few can achieve a certain scale and size. Many seller bosses believe that with their own volume of goods, integrating a few friends' sources of goods, and finding someone with a logistics background to manage, they can support a basic logistics foundation.

However, the logistics industry is gradually moving towards heavy assetization. If cross-border logistics service providers only integrate resources in key links such as trunk transportation, customs clearance, warehousing, and distribution, the controllability of services will be relatively poor. Especially during peak seasons, channel stability may face serious challenges.

Cross-border e-commerce itself is a business that highly depends on cash flow. To stock up, the larger the scale, the more capital is required. Most sellers have relatively tight capital chains, and logistics service providers usually require monthly settlement or even longer payment terms, which puts great pressure on funds.

If sellers have sufficient cash flow support, building their own logistics is not a big problem. But for sellers of average size, doing logistics themselves, especially investing in heavy asset businesses such as overseas warehouses, is likely to make cash flow even tighter and even affect the development of their main business.

For cross-border e-commerce sellers doing logistics, the threshold is not only professional ability, but also financial strength and operational management ability. Without sufficient foundation and cash flow, rashly doing logistics is easy to "lose big because of small gains".

Source: Cross-border E-commerce Logistics Expert