Business / Industries

Study: More firms set up overseas warehouses

By MENG JING (China Daily) Updated: 2015-04-01 08:25

Establishing overseas warehouse facilities seems to be becoming mandatory for e-commerce firms doing cross-border transactions, as more online consumers are becoming picky on delivery timings, said a report on Tuesday.

The report, released by global e-commerce platform eBay Inc, said that about one-third of all the Chinese firms whose annual gross merchandise volumes exceeded $100,000 had set up overseas warehouses by the fourth quarter of last year. The percentage is far higher than the rest of the world, said Zhang Kang, senior director of eBay Global Shipping, signaling the strong competitiveness of Chinese exporters.

Export logistics have bottlenecked the booming cross-border e-commerce market, as overseas consumers are increasingly picky in terms of having a seamless shopping experience.

"The overseas warehousing solution helps localize cross-border trade and expedite delivery time," he said, adding that eBay's research found that in developed markets such as the United States, the United Kingdom, Australia and Germany, consumers expect to have their online purchase delivered to their doorsteps within three days after placing orders online and they are willing to pay more to shorten the delivery time.

The internal data of eBay showed that the total gross merchandise volume of big Chinese sellers achieved through overseas units grew by 145 percent in the fourth quarter of 2014 compared with same period in 2012. Chinese mainland firms that used overseas warehousing enjoyed an even stronger boost in sales with GMV surging nearly 200 percent in the same period.

According to eBay, traditional cross-border shopping is usually time-consuming as sellers ship the goods from one country to another after receiving orders online.

Overseas warehouses allow companies to store some goods in their target markets in advance, a strategy that can significantly reduce delivery time, package damage rates and loss rates during transportation.

Statistics from AliExpress, the cross-border e-commerce site of Alibaba Group Holding Ltd, showed that the overall transactions of the world's cross-border e-commerce market are estimated to triple from the levels seen in 2013 to about $300 billion in 2018. Chinese exporters and shoppers are expected to contribute more than half of the transactions during the same period.

Wang Xiaoxing, an e-commerce analyst with Analysys International, said using overseas warehouses can help utilize local storage, which can certainly elevate Chinese sellers' service standards to match those of local retailers.

Hot Topics

Editor's Picks