Industry News

Amazon to Control Ocean Shipping?

Amazon to Control Ocean Shipping?

A Flexport Blog has recently announced that Amazon China decided to register as an ocean freight forwarder in the United States.  Amazon China now appears on the list of companies authorized to sell ocean freight services.

What does this mean?
This is Amazon’s first step toward entering the $350 billion ocean freight market. By offering ocean freight services, fulfillment by Amazon (FBA) will make it easier for its customers to move goods into the company’s logistics network. [source]

Why does becoming an ocean freight forwarder make sense for Amazon China but not for Amazon itself?
Because Amazon’s ocean freight services will be far more attractive to Chinese sellers than to American buyers…On the other hand, Amazon China can provide freight forwarding services to Chinese companies looking to move products directly into FBA warehouses, or perhaps even by cross-docking the goods for direct injection into Amazon’s courier network. [source]

Why will Amazon make a fantastic ocean freight forwarder?
Amazon has advantage over legacy freight forwarders by using software to eliminate additional transaction costs associated with government filings, status updates, pricing, booking and more, Amazon will be able to cut their costs significantly. At the same time, fulfilling products directly from China to consumers in the U.S. will cut handling costs at U.S. warehouses. [source]

To view opinions and more details about Amazon’s recent move, click here.

Why amazon china will make an outstanding freight forwarder
Why amazon china will make an outstanding freight forwarderCreated by: Shipping Exchange
[Infographic credits to Avinka G.]