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June 15, 2021

How to Minimize Alibaba Shipping Costs in 2021

Alibaba, one of the biggest eCommerce companies in the world, is an invaluable resource for eCommerce business owners, drop shippers or Filled By Amazon entrepreneurs. With an added Alibaba shipping cost, you can find factories and manufacturers who will send your order directly to your customer.   

However, if not handled properly, this Alibaba shipping cost can compromise your profit margins. 

For this reason, I want to explain how you can minimize your Alibaba shipping costs so you can begin making $300 USD per day

In this article, you’ll learn:

  • Why shipping costs are so important
  • Why Alibaba shipping costs are expensive
  • How shipping costs to the USA are calculated
  • How to minimize your Alibaba shipping costs

Table of Contents 

  • Shipping Costs: What You Need to Know and Why
  • Why Is Alibaba Shipping So Expensive? 
  • How to Minimize Your Alibaba Shipping Costs

Shipping Costs: What You Need to Know 

What Is Shipping?

Shipping is the term given to the process of packaging a product and transporting it from manufacturer to purchaser. 

The key to minimizing Alibaba shipping costs from China to the USA lies in understanding the shipping process and cutting your costs at each stage. 

source

The shipping process involves numerous stages:

  1. Packaging the product
  2. Loading the product into a truck or van
  3. Driving the package to a port, airport or harbor
  4. Clearing export customs
  5. Loading the package onto a boat or plane
  6. Getting the product to the delivery country
  7. Unloading the package in the destination port
  8. Clearing import customs
  9. Loading the package for internal delivery
  10. Driving the package to the purchaser or warehouse

To minimize your total shipping costs, you need to optimize each stage of the shipping process. 

Average Shipping Costs From Alibaba to FBA

Three factors determine shipping costs:

  • Net weight
  • Size
  • Delivery time

The heavier and larger your package, the more it will cost you to deliver. 

There are no set averages for Alibaba shipping because the suppliers listed on Alibaba all use different suppliers, all of whom have different prices. 

If you use a cargo ship for delivery, you’ll have a lower shipping cost but a significantly higher delivery time. Conversely, using air freight will speed up your delivery but will dramatically increase your costs. 

As a rule of thumb, you can expect to pay the following prices, according to shipment weights, with courier services like UPS and FedEx:

Goods WeightApproximate Shipping Fee
0.5-10kg$20-$100 USD
10-20kg$100-$200 USD
21-100kg$200-$1000 + USD

Furthermore, it’s essential to remember that suppliers charge the shipping fee — not Alibaba. 

This means you can negotiate with your supplier about the shipping costs or arrange to ship yourself. 

What Are the Different Ways to Ship Products From Alibaba to U.S. and Other Areas?

There are four standard shipping methods that Alibaba suppliers use to deliver your product: regular post, air express, airfreight and seafreight. 

Selecting the suitable method for your shipment is the best way towards achieving financial freedom through dropshipping or running an eCommerce business. 

  1. Regular post. This is the cheapest option for small shipments in dropshipping or receiving initial samples from your supplier. It is the most affordable option, but delivery will take between 15-35 days and is not the safest method available, as finding lost parcels is very hard through the China Postal Service. 

  1. Air Express. These are popular courier companies like DHL, UPS and FedEx. These services come at a premium fee but offer speedy and very reliable delivery. The price will vary according to provider and can be a great option for drop shippers who are just starting out. Source

  1. Airfreight. Airfreight becomes a viable option when the weight of your shipment starts to exceed 100kg. It’s less than half the price of air express delivery but will have a minimum weight. The delivery time also depends on the flight schedule of airlines, but generally arrives between 5-10 business days. 

  1. Seafreight. Seafreight is the most cost-effective for large shipments but by far carries the longest delivery time, generally between 30-60 days. You can choose to ship FCL (Full Container Load) if the size of your shipment can fill a whole container or LCL (Less than Container Load) if your shipment only fills part of a container. source 

The best way to minimize your Alibaba shipping cost is to select a shipping method that is appropriate to the size and weight of your shipment and your delivery timeline needs which I get into later in the article. 

Why Is Alibaba Shipping Costs to the USA So Expensive?

One of the main reasons Alibaba’s shipping costs to the USA are high is the distance it’s over 11,000 km between the two countries overseas, meaning deliveries need to go by airplane or boat. 

Shipping has also become more expensive during the COVID-19 pandemic because many postage and freight companies aren’t operating meaning those that are operating can charge a premium rate due to lower competition.  

How to Minimize Your Alibaba Shipping Costs

Minimizing your Alibaba shipping costs comes from optimizing your packaging, consolidating your shipments, choosing the best shipping method for you, and at advanced stages, planning your route and mix-and-match.  

Optimize Your Packaging

Remember that the size of your package influences shipping costs. Negotiate with your supplier regarding packaging and offer packaging advice. While it is beyond the scope of this article, you can consider taking full control of your product supply chain and sourcing your own packaging, but this takes an awful amount of work, and is only profitable with very large and frequent shipments.

Consolidate Your Shipments 

Paying for a single larger shipment is always cheaper than paying for multiple smaller loads. Plan your deliveries with as much precision as possible to minimize the number of shipments you need to get the products you’re looking for. 

Select the Best Shipping Method

Our friends over at Supplyia.com have created this handy spreadsheet detailing when each shipping method becomes worthwhile. 

Consider your shipment requirements and work with your supplier to choose the best shipment method for your delivery.  

Plan Your Route

Again, this is deep supply chain management material but it’s worth considering if you’re making regular shipments. Look at the costs of each courier at various entry and exits points (ports), and select courier companies according to where they deliver. 

Mix-and-Match 

This is a trick of the trade. With the mix-and-match method of saving on Alibaba shipping costs, you get a small percentage of your shipment, say 10%, delivered rapidly with air express, then get the remaining 90% delivered with air freight or sea freight. 

This gives you immediate stock, keeps your early customers happy, and ensures you’ve got more on the way. 

Wrapping Up Shipping Costs: Alibaba

As you can see, minimizing your Alibaba shipping costs really doesn’t have much to do with Alibaba at all it’s all to do with the shipping providers and suppliers you choose to work with. 

When you choose a supplier on Alibaba, make sure they are willing to cooperate with you regarding shipping, and then select the best shipping options for you. 

Remember: 

  1. Minimize your packing.
  2. Select the shipping method best suited to your shipment size.
  3. Try to mix and match shipment modes to get the best of delivery times and lowering your costs. 

To find more inspiration on how to live the life you want, take this last-minute opportunity and sign up to my 100% free upcoming webinar, where I discuss how to start earning $10/day then scaling that to $1000/day with a new and proven “Silver Living Method.” 

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Mike Vestil

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About the Author

Mike Vestil is an author, investor, and speaker known for building a business from zero to $1.5 million in 12 months while traveling the world.

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