Even a supply chain novice knows shipping and logistics can be one of the most costly steps of the purchasing process. Getting quotes from multiple Freight Forwarders, keeping up with General Rate Increases (GRI), needing to pull updates from your logistics partner, and paying rescheduling fees are just some of the common components of DIY shipping.
If your cargo is rolled or blank sailed, that process can get even messier. Buyers are subject to rescheduling fees and lost revenue. If you’re an Amazon seller you face a potentially impacted IPI score. DIY purchasing, sourcing, and shipping and logistics certainly can be the cheaper option on the front end, but not without its pitfalls. An alternative to DIY is hiring an end-to-end sourcing company to handle the purchasing process from start to finish. Let’s take a look at the difference between these two methods.
Start to Finish: DIY Shipping and Logistics
The first step in any sourcing journey is deciding what product or products you’re going to sell. This will look different for everyone depending on your industry. Inventors will have new concepts that likely require significant levels of customization, whereas construction companies may need ready-to-assemble wooden cabinetry. Amazon Sellers and eCommerce business owners have a wider range of product specialties. These products range from wedding cake toppers to bamboo drinking straws; from ergonomic baby products to exercise equipment.
Many identify the product they’ll sell by conducting product research on Alibaba. Here, they’ll also find a supplier, whether a factory or a trade agent to source said products. This requires supplier vetting, quote negotiations, several rounds of samples, international contracts, and carries the risk of not knowing who’s on the other side of the screen.
From there, it’s up to the buyer to hire a cluster of third parties to carry out quality control inspections, obtain quotes for freight forwarding, gather export and import certification/testing requirements, secure 3PL warehousing, organize last-mile trucking, and potentially a customs broker. If selling on Amazon, the Buyer is responsible for completing FBA prep as well.
It’s easy to see how DIY can get messy pretty quickly in a number of ways.
Disadvantages of DIY in Supply Chain
Multiple points of contact communicating through various mediums
- Every vendor is going to have their preferred communication medium. For your supplier, that medium might be email. Your freight forwarder may prefer WeChat while your QC inspection company prefers WhatsApp. Jumping between various communication platforms leads to confusion and disorganization.
- In addition to juggling multiple communication mediums, you’re working with multiple points of contact as well. This becomes particularly problematic when a scheduling issue, or something similar, arises.
- You’ll also need to oversee the logistics between all three. For example; Where and when will the QC Inspector be able to inspect your goods? What happens if they find non-conformities/defects? What happens if your cargo isn’t ready by the Cargo Ready Date (CRD) and your freight forwarder can’t pick the goods up? This often brings a lot of ‘he said, she said’ into the coordination between all parties.
Miscommunications and language barriers
- English is often not the first language for suppliers and freight forwarders, and key details can be misinterpreted or in translation.
- Interpretation of expectations often leads to major issues down the road, resulting in the Buyer feeling let down by one of the parties.
Lack of accountability
- By not having one point of contact, there is a natural lack of accountability. Vendors are quick to point the finger to another member of the supply chain if something goes awry. It’s ultimately up to you, the Buyer, to play detective and see where the issue truly originated which can be very time consuming and oftentimes costly.
Getting updates is like pulling teeth
- More often than not, your points of contact will not be based in the United States. Sending proactive updates is not the norm in all cultures. Even if you reach out and ask for an update, some vendors still don’t respond if they don’t have anything to report. It can also be difficult to get timely responses when communicating with someone on the other side of the globe.
- Most freight forwarders carry the reactive approach rather than proactive. This means that you and the warehouses you deliver your goods to need to pull the updates from them. 3PL warehouses may receive last-minute delivery notifications resulting in them not being able to take your cargo. That often leads to the trucking company charging the freight forwarder for holding the cargo and the freight forwarder charging you.
Lots of trial and error with freight forwarders
- Buyers will naturally gravitate towards the cheapest solution which can lead to issues like Rolled Cargo, last-minute price increases, and your chosen freight forwarder charging your suppliers ridiculous amounts for gathering export documentation.
- Freight forwarders also have a tendency to over-promise and under-deliver on shipping timelines to win the business. This is, of course, something you won’t find out until it’s too late.
- Freight Forwarders do not own the last-mile trucking companies they use to haul your load. Your FF may believe they’ll be able to deliver your goods on a certain date, but it’s dependent on their relationship with the trucking company in that region. They are entirely dependent on the trucking company.
- Insight: You get what you pay for! The cheapest trucking company, but could have last-minute charges due to their lack of scheduling with the final destination. Thus the need to store your goods for longer, resulting in charges to your Freight Forwarder, which are passed onto you.
No way of confirming the reputability of each of these vendors
- You never truly know who is following through on their promises when you’re on the other side of the globe. Confirming the legitimacy of a business is one thing, verifying they’re following through on tasks as promised is another.
- This is particularly difficult to gauge when they deliver internationally. One Freight Forwarder that has the network needed to ship to the West Coast may struggle with deliveries to the Midwest or East Coast, due to inadequate trucking partners.
Freight Forwarders charging Suppliers
- It’s a common misconception that once you pay your Freight Forwarder, you’re paying for everything involved with shipping and logistics.
- Freight Forwarders often charge suppliers fees for export clearance, certificates of origin, gathering additional documentation, and port charges. They do this to keep the costs they’re charging you low, appearing more competitive.
- This often leads to a strain on your relationship with your supplier and may lead to price increases down the road.
Increased risk of delayed shipment
- Choosing the cheapest shipping option increases the risk of your shipment being rolled or blank sailing.
- The most affordable Freight Forwarders often have the cheapest logistical partners, frequently leading to delays in shipments, pricey last-minute charges, and damaged goods.
The Benefit of DIY Shipping and Logistics
It’s typically cheaper on the front end, there is no doubt about that. Freight Forwarders can help you explore shipping options such as expedited ocean freight or splitting shipments between sea and air.
However, you have to ask yourself if it’s worth the money that is lost when:
- Your shipment is rolled.
- Your super-affordable freight forwarder doesn’t coordinate well with the trucking company causing delays in delivering to your 3PL warehouse.
- The trucking company charges you for additional storage after the Last Free Day (LFD) due to poor communication.
- The back and forth shipping that you have to pay for if the pallets are not up to FBA standards.
- You’re shipping back and forth when the import/export regulations aren’t followed accurately.
- You receive shotty QC inspections.
- Countless hours are spent communicating and coordinating with all these vendors.
Shipping and Logistics with Noviland
Our goal at Noviland is to manage your entire supply chain so you have more time to work on your business instead of in it.
Your Dedicated Team
We assign a team of product, factory, QC, and logistics experts to your account, all of which are Noviland employees. This team works together to ensure your project is brought to life, from Request for Quote (RFQ) submission, through delivery to the final destination – wherever that may be in the world.
Your Noviland care team collects quotes from our network of over 4,000 thoroughly vetted factories to identity the supplier best suited to create your product. Your team then coordinates ordering samples, placing batch orders, providing quality control reports, and organizes logistics to the final destination.
Going the Extra Mile
Your Noviland Logistics Manager makes sure that all aforementioned steps are taken care of and accounted for in the upfront pricing, alleviating any worry about last-minute surprises. This includes ensuring all export/import requirements are taken care of, insuring your cargo for transport, and taking care of all customs duties and documentation when shipping to the US. For our Amazon clients, your FBA shipments are prepped according to all Amazon FBA Prep Guidelines,
Orders flow through one of the Noviland Logistics Service Centers in the country of origin to ensure your cargo is safe for transport and prepped for final delivery. At this stage of the additional packaging reinforcements, FBA/FBM labeling, palletization, and QC inspections are conducted. Our internal quality control team ensures that you will receive a superior product every time. We complete order consolidations at the service center as well, saving you hundreds of dollars on every order.
Transparent Communication and Confidence
Throughout this process, users receive push notifications with order updates from their Noviland care team. Our easy-to-navigate, free-to-use platform is designed to place you in control of your supply chain. Through our system, users can answer questions from suppliers, place new orders, oversee production and QC, and track shipping. Noviland’s proprietary shipping and logistics partnerships minimize the risk of your cargo being rolled or blank sailed.
Through Noviland, you can be confident that your product will be produced to your specifications and delivered on time.
Lisa Kinskey is the Marketing Assistant of Noviland, Inc., a rapidly growing sourcing & purchasing solution making sourcing from overseas factories simpler. Lisa has a background in sales, marketing, and event planning and currently resides in Kennesaw, Georgia.