With Amazon FBA import, the same or similar set of questions often appears: How to ensure the safe and cost-effective transportation of goods from the manufacturer in China to the various Amazon fulfillment centers in Germany? Is there anything special you, as entrepreneur, have to be aware of? Is there a "step-by-step" guide to do it? Is there a reliable logistics provider?

Our last post aims to answer all those questions and empower the readers with the knowledge and information necessary to successfully navigate the logistics of international trade and ensure a smooth and efficient importation process.

Good to know: the information found in the post is applicable for import anywhere in the EU. Germany is used as an example due fact that it is the most common choice.

Consider conducting thorough research when choosing an importer to ensure you get the best possible price and service level. Importing goods can be a costly process, and failing to research and compare different importers can result in unnecessary expenditures.

The shipping methods

There are three typical shipping methods for importing goods: ship, train, or plane. It is crucial to carefully consider these options, as they can significantly impact the costs and profit margins.

Importing goods by ship is generally the most cost effective and highly recommended option. However, it's important to note that shipping by sea can take approximately four to five weeks (28 to 35 days), meaning you should closely monitor your inventory levels, especially when reordering, to avoid running out of stock.

Good to know: Consider importing a portion of your goods by air. This way, you can start selling sooner while the remaining goods are still in transit via sea, allowing you to make sales and generate revenue ahead of the total shipment's arrival.

The shipping costs

Consider conducting thorough research when choosing an importer to ensure you get the best possible price and service level. Importing goods can be a costly process, and failing to research and compare different importers can result in unnecessary expenditures. By researching, you can identify importers that offer competitive prices, favorable terms, and reliable service, helping you optimize your costs and improve your profit margins.

Below are estimated costs associated with different types of transportation for the same weight (300kg) and volume (3.75 cubic meters):

• Sea: 28 to 35 days, 1200.00€
• Train: 21 to 28 days, 1500.00€
• Plane: 6 to 10 days, 3150.00€

It's important to note that each logistics provider may have varying shipping times and prices.

The terms and terminology

Being familiar with Incoterms (International Commercial Terms) is essential for ensuring smooth communication and understanding the rights and responsibilities of all parties involved in international trade.

What are they? They are rules and conditions that determine the responsibilities and obligations for delivering and accepting goods between the manufacturer and the buyer. Choosing the appropriate Incoterm is crucial as it defines who is responsible for the shipment until a specific time or place. They impact various aspects of the shipment, such as shipping costs, insurance, and risk of loss or damage during transportation.

DDP, DAP, EXW, FOB Incoterms

We will use a few scenarios to explain which Incoterms to use when importing to Amazon FBA.

Scenario 1
You are the owner of goods at the time they are shipped to Amazon FBA. Company “A” from Hong Kong is a manufacturer of the products which they sell over Amazon in Europe. Company “A” is VAT registered in Germany and is shipping their goods from China to Amazon FBA warehouse in Germany.

• Incoterm used is DDP (Delivered Duty Paid) as the seller and buyer are the same legal entity (company “A”). Company “A” will pay the import and customs duty in Germany and will apply for the import VAT refund in the German VAT return.

Scenario 2
You are the buyer of goods at the time they are shipped to Amazon FBA. Company “B” from the United States is sourcing products from a supplier in China, which they sell over Amazon in Europe. Company “B” is VAT registered in Germany, and products are shipped from China by the supplier directly to the Amazon FBA warehouse in Germany.

• Incoterm used is DAP (Delivered At Place). Company “B” will pay the import and customs duty in Germany and will apply for the import VAT refund in the German VAT return.

Scenario 3
You are the buyer of goods at the time they are shipped to Amazon FBA. Company “C” from the United Kingdom is sourcing products from suppliers in India, which they sell over Amazon in Europe. Company “C” is VAT registered in Germany, and it is using a freight forwarding company to organise and manage the transport from an Indian supplier to the Amazon FBA warehouse in Germany.

• Incoterm used is EXW (Ex-Works) or FOB (Free On Board). Company “C” will pay the import and customs duty in Germany and will apply for the import VAT refund in the German VAT return.

Easy-to-follow 10-step process

Once you have chosen an appropriate Incoterm, you can begin the import process. While it may seem overwhelming at first, this comprehensive guide will provide you with a clear understanding of the steps involved.

Step 1
Obtain quotes from different logistics providers to compare prices and create a comprehensive cost calculation.

Step 2
If the numbers in your cost calculation are favorable, you can proceed with placing a bulk order with your manufacturer.

Step 3
Share the shipping marks with your manufacturer.

Step 4
You book your chosen logistics provider and provide them with the contact details of your supplier. The logistics provider will then initiate contact with your manufacturer.

Step 5
Schedule a quality inspection for your goods, and remember to book it before each order. This will ensure the quality and reliability of your products.

Step 6
Provide your logistician with all the necessary documents such as the Commercial Invoice and Packing List. It's also important to complete any customs documents that your logistician sends you.

Step 7
Once your goods have arrived in Germany and have been cleared through customs, you can proceed to create your delivery schedule at Seller Central.

Step 8
Provide your logistician with the Amazon shipping labels, making sure that each label is attached to the correct box individually. This is crucial, especially when dealing with varying quantities per box, to ensure smooth processing at the Amazon fulfillment centers.

Step 9
Once your goods have been dispatched to the shipping service provider by your logistician, you will receive confirmation from them. This confirmation serves as an important update on the progress of your shipment.

Step 10
If there is no update regarding goods being successfully stored within two business days, follow up with your logistician to confirm everything is on track.

Good to know: If you are sending in your goods for the first time, please note that storage may take longer, especially if it is being sent to the DTM-2 warehouse.

The shipping marks

Essentially, shipping marks refer to the information your supplier will place on the outer cartons or boxes in which your goods are packed. For larger orders, this information may be printed directly on the boxes, while for smaller orders, suppliers may use labels. While suppliers may not always ask for shipping marks, in some cases, you may need to provide this information to them.

Basic information for shipping marks are:

• (Your) Company name
• Carton number
• Carton size
• Net weight
• Gross weight

Additionally, you can add so-called "handling marks" which typically display specific warnings about the contents of the boxes, such as "Food," "Fragile," "This way up," "Keep dry," and so on.

The information provided on the boxes should help your logistician to identify and distinguish your boxes quickly. Clear and accurate printing can speed up some processes, allowing you to start selling your products sooner. This is particularly important if you order different variants of the same item. The process could slow down if the boxes cannot be easily distinguished from the outside.

Good to know: In certain cases, when shipping dangerous goods like flammable liquids, gases, toxic materials, etc., special labels may be required. However, in most cases, the shipping company will handle this on your behalf. If necessary, they will provide you with additional information on any extra warnings or labels that may be required.