Logistic Issue

Waiting a call again.
Have to start moving else I’ll lose my breath.
Quote of the week: Cutting down 15% in purchasing and 30% in servicing budget?

While I was thinking a solution to the tax barriers and transportation costs in penetrating regional/global market, I do some researches and reviews on how people doing in the past and future.

Can I sell my goods to overseas without setting a branch there? Perhaps no for major businesses.

With the raise of the small businesses, more and more are seeking ways to go beyond the border. However, many of them lack of capitals, backup, and knowledge to build a good supply chain in their logistic network. Today the best way to penetrate your market is to leave it to logistic companies. For example, You are a Singapore company who wish to sell a printer assembled in Penang Free Trade Area (FTA), Malaysia to regional countries like Singapore, Vietnam, and Thailand. Using traditional retailer method, it would be:
Import the printer–> Own warehousing–> wait for order–>Export
In order to shorten the supply chain, we can acquire the expertise from logistic company like DHL.
purchase the printer–> store in Malaysia DHL warehouse–>wait for order–>then export directly from Penang.

In this case, we save the time, place(warehousing), and custom duties etc. This is the best practice I can think of in today’s international business model. This method actually like Dell in Penang, and those outsource companies in India and Vietnam.

Unlike intangible goods, the concern of servicing is unavoidable. How would you offer service to the buyer from oversea? Unlike Big company like Dell that eliminated middle-man, retailer normally impossible to offer such after sales service. This perhaps explained why almost all US online retailer do not offer purchase from oversea countries.

Therefore as a retailer if you think to sell a relatively large tangible product (printer, spare-parts,tools)and not rare (antique, painting, collectibles) to international market just via internet, it wouldn’t be successful. In other words, Backward Integration is much harder than Forward Integration.