Sourcing from China is a core part of many marketplace sellers' operations, and logistics is where a large share of the money goes. Here are three practical ways to reduce those costs and keep more of your margin.
1. Cargo volume and product density
Two products with the same unit price can have very different delivery costs from China. In large-item logistics, what drives the final shipping bill is cargo volume, not just value.
Light and bulky goods are expensive to move. Heavy and dense goods cost several times less per unit of value. A smartphone is a good example of a dense product: it takes up very little space but is relatively heavy. Electronics in general behave the same way.
You can also combine dense and bulky goods in one shipment. Two simple rules apply:
- Combine products from the same category.
- Pick products with the biggest difference in density.
2. Delegation and cargo consolidation
Delegation means the supplier takes responsibility for the safety of your cargo until it is shipped. If something goes wrong before dispatch, the supplier is liable and you can claim compensation.
Consolidation works differently. Goods from several suppliers are stored in one warehouse until the full order, or the volume needed for dispatch, is collected. Then everything ships to you as a single consignment.
This suits sellers who buy from different suppliers over several days but want one sender. The importer collects the goods at its warehouse and notifies you when the batch is ready. Shipping one large batch is cheaper than shipping several small ones, and that is where the savings on logistics come from.
3. Choosing the right shipping method
There are many ways to move goods from China: air freight, rail, trucking, sea freight and more. Each fits a different task and a different budget.
Air freight
Price depends on the number of boxes, weight, volume and the carrier's delivery terms. A simple rule of thumb: do not fly cargo heavier than 300 kg or larger than 3 cubic metres. Beyond that, air freight becomes too expensive and usually unprofitable. It can be faster, including document preparation and customs clearance, but it is costly and not always justified.
Trucking
Cost depends on weight and volume, paperwork and cargo complexity. If you are building a large consolidated shipment, allow extra time to collect all goods from suppliers at your warehouse. Trucking is cheaper than air but usually slower, so plan for it.
Rail
On average, rail freight is cheaper than air freight.
Sea freight
Sea transport is cost-effective for both 40-foot and 20-foot containers. Container shipping suits sellers buying in the millions of dollars, where it becomes the most economical delivery method. It is not a fit for beginners with smaller order volumes.
What to choose
- New sellers: trucking or rail.
- Urgent goods with tight deadlines: air freight.
- Large, regular volumes: sea containers.
Bottom line
Experiment with cargo volume and density, consolidate shipments from different suppliers, and match the shipping method to your volume and deadlines. These three levers reduce logistics costs and increase net profit.
