Is Your Supply Chain Ready for Cross-Border E-Commerce?

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Is Your Supply Chain Ready for Cross-Border E-Commerce?

By Phil Teng - 12/28/2018

E-commerce is no longer viewed as a disruptor to retail businesses. As the cost of internet access goes down and more people around the world buy products online, e-commerce is becoming mainstream and etailers are gaining new ground.

There are many benefits of e-commerce for both retail businesses and consumers. For retailers, it’s less expensive to do business with e-commerce. While etailers still need importers, exporters, brokers, and others, fewer physical entities means an overall reduction in costs.

In addition, sellers no longer need to seek favor from an importer’s merchandise manager to make their products visible to buyers. Buyers and sellers can meet online at any time and exchange money for products.

For consumers, e-commerce is unlocking countless personalization opportunities and transforming the industry. What began with customer to customer (C2C) has rapidly expanded into business to customer (B2C), manufacturer to customer (M2C), and business to business (B2B). Now, cross-border e-commerce is even connecting consumers with manufacturers (C2M), which is making industries more customer-centric in all aspects.

Transforming the Supply Chain

Now, the main challenge for many etailers is how to create a fully functional supply chain that can withstand the impact of e-commerce spreading across international borders.

For cross-border e-commerce to thrive, etailers must create a closed-loop ecosystem within their supply chain. This means connecting individual pieces of the supply chain via the internet into one bundled, integrated and collaborative network. This includes business transaction, cargo shipping, payment wiring and collection, and document exchanges.

Each closed-loop ecosystem still contains the different resources to support the operations of the entire supply chain, and customer expectations help enable each service. This integration keeps costs low and improves overall efficiency by keeping the flow of business, data, cash, and logistics continuous and collaborative.

For example, Amazon’s logistics ecosystem supports the needs of Asian sellers who use Amazon Global Selling and other marketplaces to sell products in the United States. The ecosystem includes international fulfillment by Amazon (FBA) shipping, U.S. efulfillment facility services, various emarketplace distribution centers, and all related logistics services.

Amazon’s FBA Export program enables sellers to expand their businesses to more than 100 countries without dealing with the complexities of selling internationally. It is based on Amazon’s 220 fulfillment centers and trucking suppliers across the United States. Essentially, Amazon combines its own retail goods together with its sellers’ third-party goods to ship, and all parties in this ecosystem share the logistics costs.

Amazon is building a similar inbound China cross-border e-commerce logistics ecosystem by connecting all resources together to serve the overseas sellers who tend to sell in China. This will also be a complete supply chain service.

With efficient supply chains that operate as closed-loop ecosystems, each cross-border e-commerce participant sees huge benefits.

-Phil Teng, director, Ecommerce Logistics at C.H. Robinson Asia