Half of your cost is paid for 'air'!

If you are a cross-border e-commerce brand or supply chain enterprise, you should be familiar with this scenario: a batch of health products with low value, due to their bulky packaging, are purchased from China and shipped overseas, then produced and packaged overseas, and sent back to China. In the end, you may find that the shipping cost sometimes exceeds the value of the goods themselves.

What's even more heartbreaking is that upon closer inspection of those large bottle packaging materials, when sent overseas, the bottles and cans are filled with air; Even when sent back to China, the truly valuable products inside may only account for less than half of the entire volume, with the rest of the space occupied by air, packaging materials, and ineffective fillers.

Pain point: We are paying a huge fee for 'invalid volume'

The calculation standards of international logistics follow the principle of "taking the larger of volumetric weight and actual weight". The original intention of many health product packaging designs is for retail aesthetics and long-distance transportation protection, rather than cross-border efficiency.

This leads to an industry paradox: a significant portion of the shipping costs you pay are actually paying for the 'air'. This invisible cost is silently devouring your profits.

'Air' devours profits: modular supply chain approach, squeezing out 'air'=profit

So is there any way we can squeeze out the "air" part of this supply chain, improve the efficiency of goods turnover, and save costs, which is profit.

Of course there is!!

In fact, many years ago, there were already many supply chains that divided packaging materials, production, and packaging into several modules and operated in different regions: domestic packaging factories produce packaging materials+overseas factories produce products=Hong Kong packaging factories carry out packaging, and after producing finished products, they are directly sent to domestic bonded warehouses.

Q: How does modularity squeeze out the 'air' in the supply chain?

(1) The packaging materials originally sent to overseas factories only need to be sent to the Hong Kong factory adjacent to mainland China;

(2) The overseas factory used to send large volume finished products to the Hong Kong warehouse and wait for import customs clearance. Now, only small volume particle spot goods need to be sent to the Hong Kong factory;

(3) The volume and weight of the goods sent from the Hong Kong factory to the bonded warehouse remain unchanged.

A：

Friends who have seen this, why not calculate how much shipping profit can be saved for the entire chain by using the weight and net particle weight of their latest batch of goods and packaging in Hong Kong.

Moreover, in addition to shipping costs, there are also significant differences in packaging costs. Taking a regular plastic bottle with a size of 60 tablets for compressed candy products as an example, using the same filling, labeling, and coding process, the packaging cost in the US factory is about 1.5 US dollars, while in the Hong Kong factory it is less than 5 Hong Kong dollars.

A batch of 5000 bottles of goods, packaged in Hong Kong, can save about 15-20% of the overall cost compared to importing directly from overseas.

The cost saved is profit

In addition to the explicit costs that can be calculated above, Hong Kong packaging can also save the following hidden costs:

(1) Communication efficiency: Due to the time difference and workplace culture, many overseas factories have slower information feedback efficiency, which can invisibly delay the production efficiency of goods.

(2) Shelf efficiency: If packaged overseas, there will be more variable time for sea freight or air freight clearance; If the particles are prepared in advance and sent to the Hong Kong warehouse, they can be packaged at the Hong Kong factory when they are ready for production and shelving, and immediately sent to the bonded warehouse to improve the turnover efficiency of the goods.

Summary

In today's fiercely competitive cross-border e-commerce market, profits come from optimizing every operational detail. Modularization of counting and packaging is no longer an "optional" option, but a "standard configuration" for many smart brands to enhance their competitiveness.

It directly attacks the biggest cost pain point - logistics, converting the expenses that were originally wasted on ineffective space into tangible profits on your books.

How much can your product save?

Send me a private message! Let's calculate together how much profit margin there is for your batch of goods