Buying in China and Selling on Amazon – Part 1: Shipping & Logistics

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It’s the gold rush of our time (or at least the decade). Seemingly, everyone wants to get their products out on Amazon.com. I’m no stranger to e-commerce myself, as that’s how I started doing business with Chinese suppliers in the first place. However, up until quite recently, E-commerce in Europe and America has been dominated by independent online stores, rather than market platforms. This is about to change.

About Amazon.com

What makes Amazon.com different is that they are not only offering an online platform, but also an integrated logistics system. Ship your bulk cargo to one of Amazon’s warehouses and they take care of the rest, sending your items to your final customers. But that’s only the easy part. Assuming you are buying from China, or any other country outside the United States, you need to get your cargo from a factory floor far away, to an Amazon warehouse. That is often easier said than done, and much can go terribly wrong.

So, we did what we usually do when we don’t have all the answers. We asked an expert. In this article, Kathy Rinetti, Customs Manager of Flexport.com in San Francisco, explains what importers must know about shipping and logistics, when buying in China and selling on Amazon.com. She also explains how non-US businesses can start selling on Amazon.

Kathy, please tell us a bit about yourself and your work prior to Flexport

I bring over 20 years of international trade experience with emphasis on compliance and customs clearance. Prior to joining Flexport, I helped define the U.S. Customs classification logic for two leading international trade software companies. At Flexport I focus on combining compliance with customer service to make importing a painless process.
Flexport helps importers navigate shipping and importing using an innovative software solution. Clients are notified when documents are needed and of their shipments’ statuses every step of the way.

Is it possible to have cargo forwarded directly to an Amazon.com warehouse, from the Port of Destination in the United States?

Yes, definitely. To do this, the Bill of Lading would need to be filled out properly with:

1. the Importer of Record as the name of the importer
2. the Consignee as the Amazon warehouse

It is important that the Amazon warehouse’s contact information be included, because they usually require appointments for shipment deliveries. If this info is missing or inaccurate, it can delay the delivery of the product.

What are some tips for shipping to an Amazon warehouse?

After a shipment is cleared through U.S. Customs, importers will need to make an appointment with their Amazon warehouse and update them on the delivery timetable. Appointments are required, but they also take 2 – 7 days to be confirmed once they are requested, and they cannot be changed.
In addition, it’s important to maintain your levels of supply in the Amazon warehouse. Amazon determines which vendors with the same product are given higher status by monitoring each vendor’s stock of goods, and if you do run out of stock for popular items, Amazon can and will ask your competing vendors to carry those products going forward.

Should importers selling on Amazon.com select any particular Incoterm?

Importers should negotiate DDP (Delivered Duty Paid) terms, because everything in regards to costs would be settled prior to the shipment’s delivery at the Amazon warehouse. The shipper and the importer would thus not have to worry about any delays that could result from paperwork and clearances or pending payments.

Should the warehouse address be declared on the Bill of Lading, or any other shipping document?

The warehouse address and contact information must be included as the consignee on the house bill of lading.

Are there any labeling requirements that US importers selling on Amazon.com should be aware of?

Amazon warehouses may have special instructions regarding labeling and organization of products. This information can be found here.
In addition, by federal law, all goods must be marked with country of origin. For example, goods originating in China should be marked “Made in China.” The marking must be legible and permanent enough for the ultimate purchaser to be made aware of the goods origin. More details about labeling requirements can be found here.

We also receive inquiries from non-US based companies planning to sell products on Amazon.com. Is it possible, as a foreign entity without a local presence, to import items into the United States and sell on Amazon.com?

A foreign-based company can apply for a Customs assigned number which will allow them to import into the US. It’s a requirement that a foreign importer designate an agent for service or process.

This number can be obtained by filling out a Customs Form 5106 and submitting it to Customs, or by having a Customs broker do it electronically on their behalf. Once the company has a Customs assigned number, they will be able to obtain a Customs bond and import into the U.S. under that bond.