By Richie Lin    Photo：CANVA

Before the explosions of online shopping, if you want to sell products to the customers in the USA, you could only choose the channels of retail stores such as Walmart, Target, Menards, Home Depot. However, the booming of online shopping has given the manufacturers another opportunity to sell products to end-users. The United States retail eCommerce sales stand at $1.26 trillion by the end of 2024 and experts expect to reach $1.72 trillion by 2027. By then, online sales will make up about 22.6% of total US retail sales. Amazon holds 37.6% of the eCommerce market share in the United States. This makes Amazon the biggest market share holder in the United States with Walmart in the second place with a 6.4% market share. Since Amazon occupies the biggest share of online sales, it is naturally for Asian manufacturers to choose Amazon as the platform of selling products directly in USA. This is the reason why we should understand the basic procedures of FBA (Fulfill by Amazon) in the United States. Compared with ordinary logistics, there is no difference in ocean freight and airfreight parts. Therefore, I will focus on explaining the procedures happening in the USA.

1. Import customs clearance in USA:

When declaring import customs, it requires a company to be the IOR (Import of Record) and pay the bonds. It is usually the importer to be the IOR. However, Amazon is not willing to be the IOR because they don’t want to take responsibility for the products. Therefore, the manufacturers will need to set up a company in the USA or use themselves to be IOR. CBP allows foreign companies to be IOR and pay the bonds, duties, HMF and MPF. However, it is not cost-effective to buy bonds to be IOR for the starters in selling products on Amazon platform. Henceforth, manufacturers could think about cooperating with the trading company which can be the IOR in the USA. However, trading company will need product names, HTS codes, invoice values to check if they can accept to be the IOR for your products. And it is more complicated if your products need FDA approval. FDA requires that the receivers of products must also have FDA certificate. The receivers in USA are usually logistics warehouses or Amazon, which don’t apply the FDA certificate. In this case, the manufacturers will need to find a FSVP Agent in USA to be the receiver for products. Foreign Supplier Verification Programs (FSVPs) is to assure their non-U.S. suppliers are producing food in compliance with processes and procedures that provide, at minimum, the same level of public health protection as those required.

2. Containers arriving ports and inland rail ramps:

After vessels arriving the ports, containers will be discharged at the terminals of the ports. Normally the terminals will charge THC (Terminal Handling Charge). But THC in USA is already included in the ocean freight rate from Asia, it will not be charged again on USA soil. If the final delivery place on the MBL is the port, containers would stay at port and wait for customs released by CBP. If the final delivery place on MBL is the IPI (Interior Point of Intermodal) such as Chicago, Detroit, shipping lines will transfer the containers to the railway companies to move them to the inland rail ramps to wait for customs release. And railway companies will not charge the movement on the rails because it is also included in the ocean freight rate from Asia. And it normally takes 7~10 days to transfer the containers to inland rail ramps after it was discharged at the ports. However, due to port congestion, labor shortage of ports and railway companies, sometimes it would take more than 14 days to transfer finally the containers to the inland rail ramps.

3. Delivering containers to warehouses:

Our Agent will receive a pick-up number from shipping lines after container is unloaded at ports or rail ramps and it would show the LFD (Last Fee Day) of demurrage and rail storage. Shipping lines usually provide 2 days free demurrage and rail storage, then trucking companies need to pick up the container before the LFD. When the containers arrive at the warehouses, warehouse staff will unload the products and check the numbers of packages, product names, product codes, serial numbers or any related information. Products will be accepted in the warehouse and updated in the WMS system after the information matches the documents. After unloading the container, truckers will bring the empty container back to the port or ramp to return it to shipping line.

4. Delivery to FBA warehouse:

When manufacturers receive confirmation from warehouses, they can begin to apply to enter the Amazon warehouses. Customer can sign into their Amazon Vendor Central portal to check their shipments. They should confirm the quantity and ready ship date. When they get the confirmation from Amazon, they will send the Amazon Label and ASN number to the warehouse. Our warehouse will build up the pallet as required by Amazon which could not exceed 40x48 x 72 inches, stick the amazon labels for each box and pallet, schedule delivery time with Amazon by the ASN number, then deliver to the designated Amazon warehouses. When shipping to Amazon, there is one key difference regarding label application. If the ready ship to Amazon date can be confirmed and factories can build up Amazon pallets before shipping out, manufacturers can sign in to Amazon portal to get labels, print out and stick on each box and pallet.

Above are the basic descriptions for the FBA logistics from Asian countries. FBA logistics needs well-round end to end logistics knowledge, experiences, and strong networks to fulfill the needs of manufacturers from Asia. If you want to have more information, please contact richie_lin@tgl-group.net.

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