By Richie Lin    Photo：CANVA

Imagine yourself a manufacturer in Asia and want to sell your products in the USA market. Around 10 to 15 years ago, your options were controlled by the middlemen of retail stores such as Walmart, Target, Menards. 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 $579 billion as of the first half of 2024. USA eCommerce sales accounted for $291.6 billion in the second quarter of 2024, this is an increase of 0.82% from the previous quarter and a 6.8% increase compared to the same quarter last year. This puts the total ecommerce sales in the country to $579.45 billion as of the first half of 2024. Experts predict sales to reach $1.26 trillion by the end of the year and $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). 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 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 and delivery to FBA warehouse:

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. Shipping lines usually provide 2 days free demurrage and trucking companies need to pick up the container before the LFD. When the containers arrive at the warehouses, workers will unload the products and check the numbers of packages, commodity names, part numbers or any related information. Products will be accepted in the warehouse and updated in the WMS system after the information matches the forecast. After unloading the container, truckers will bring the empty container back to the port or ramp to return it to shipping line. When manufacturers receive confirmation from warehouses, they can begin to apply to enter the Amazon warehouses. When they get the confirmation from Amazon, they will send the Amazon Label to the warehouse. Our warehouse will build up the pallet as 40x48 x 72 inches, stick the amazon labels, then deliver to the designated Amazon warehouses.

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

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