Fulfillment in China. Anyone have experience?

[mphilips]

Dropshipping right now, doing low-mid $xxx,xxx/month in rev. Seems like a good next step, as we sell in a few countries USA,AUS,NZ. While I'd like to go straight to local fulfillment, I have to figure out the requirements to selling in those 3 countries locally, as we are located in Canada.

Our suppliers are doing a good job, but since we use sites like AliExpress and a few others, I don't want to rely on them and it is causing some pains with customer service and outsourcing. Plus, we can try re-branding some products and combining them and start customizing the orders a bit more.

The one odd thing that we've found, is somehow our suppliers can get us ePacket shipping very cheap under 2kg in an order, we've spoke with 2 fulfillment centers so far and they both charge by weight of order and while still profitable, we find our suppliers are still making a lot more from us when we use them to dropship vs using these fulfillment centers, even after removing the middle man costs.

Anyone have experience in this area? Would love to chat.

[AdcentricBrandon]

We are in a similar situation. I spoke to a US fullfillment company and they told me that its actually cheaper for these chinese suppliers to ship to the US using epacket than it is for them to ship domestic. Supposedly, the government did this to facilitate business between China and the US (not sure how true it is)

[dmitri]

You're doing 6 figs rev / mo dropshipping off Aliexpress and you've managed to keep your merchant accounts alive? Props to you, seriously. Who do you use for processing if you don't mind me asking and do you have your own merchant accounts with a rolling reserve or the default aggregated accounts?

[mphilips]

*knock on wood* - Using Shopify for the store, so shopify payments and paypal right now. (for last 3 months). Just the default acct. We haven't been forced to keep a reserve yet, but we do leave 2k or so in PayPal at a time. Getting set up with BrainTree as well to implement OCU upsells, but I don't want to start that up until I get a warehouse situation organized (still looking).

[dmitri]

Nice. What's your CB% like and have they asked for tracking#'s occasionally as well?

[mphilips]

Shopify: Around 0.1% Although probably will be 0.2% or so after Xmas now. PayPal - much higher. We get around 3-4 disputes a day (always non-receipt because it takes so long) and. CBs around 0.5% i'd say, maybe a bit higher. We win a lot of them though. Our system syncs tracking numbers with Shopify automatically. We upload Tracking # to all disputes on PayPal. Always leave about 1.5k-2k in PayPal though to deal with disputes/refunds. I think we have about $900 on-hold with them.

[dmitri]

Ah, still quite low, even with Paypal. Relatively WH niche I'm guessing. I've heard some people getting their payment processor accounts shut down cause some suppliers on Aliexpress are too slow to upload the tracking#'s and sometimes even add bogus tracking#'s so when the payment processor asks for tracking#'s to double-check everything they won't be up to par.