The scenario is a familiar one, not just for companies in the United Arab Emirates, but for businesses throughout the Middle East and across Asia and Europe as well. Your products are selling well, and you see strong growth in the e-commerce market. You are getting to the point in size and scale where you think it might be time to expand overseas. The only problem is that breaking into foreign marketsâ€”particularly the lucrative United States marketâ€”brings significant logistical expenses.
To penetrate an overseas market, you have to be ready to shoulder a hefty investment. From shipping freight costs to get your products to the United States to the expenses of buying or renting a warehouse in the USA and paying employees to staff it, the overhead costs associated with breaking into an overseas market are prohibitive for some companies. How can your enterprise save money throughout this process and make expanding to North America not just a viable option, but a profitable one as well?
Outsourcing Your Warehouse Distribution Services
The natural solution to these hurdles is to find a company that can offer wholesale distribution services for e-commerce. You need to find an American partner company that can provide warehousing, order fulfilment, and product distribution to you at a fair and equitable cost. These services can mean the difference between prohibitive costs and easy access to North American markets. Just make sure you are doing your research to make sure that the warehousing company you are considering is experienced and reputable.
If you can find the right partner for warehousing, you will enjoy the many benefits of outsourced overseas distribution and inventory management, including:
- Lower Overhead
The costs of working with a warehousing and distribution services company aren’t exactly negligible, but they are much less expensive than the alternative. Searching for storage space, renting or buying a warehouse on foreign soil, hiring staff to handle inventory management and distribution: these are just a few of the costs that you will face if you try to handle overseas warehousing in-house. Letting go of the control of these services can be nerve-wracking, particularly since you may be working with someone on the other side of a language or cultural barrier. However, the reduced costs of outsourcing your distribution services will give you a much better chance of succeeding with an overseas expansion plan.
Renting or buying warehouse or storage space is difficult for new businesses because there is always a question of how much or how little space is necessary. Surely the business will grow and need more capacity to store inventory in the future. However, is that promise of growth enough reason to spend money on unused space for months at a time? The same questions may greet you when you make a move to expand overseas. Yes, your brand is more established than the average start-up business, but you are also moving into an entirely different part of the world, where consumers might not be familiar with your brand at all.
As a result, you could face the same dilemma when trying to secure warehouse space. Opting to outsource your warehouse makes scalability much easier because you can rent space based solely on how much inventory you have. As your North American demand picks up and your inventory grows, your outsourced warehousing and distribution company should make it easy for you to scale your services and rent more space.
Many United States businesses outsource their warehousing, inventory management, and product distribution servicesâ€”even though they are domestically based. These companies realize that logistics and supply chain management are not their first, fifth or 10th areas of expertise. As a result, they hand those duties off to a third party and focus on the parts of the business that do reflect their expertise. What’s the sense of learning the techniques of North American supply chain management or trying to oversee order fulfilment from afar? Instead, you can give those responsibilities to a company that countless U.S. businesses are already counting on for the same services.
Penetrating a foreign market is never easy, but expanding overseas introduces, even more, complexity into the mix. Outsourcing your warehousing, inventory management, and order fulfilment helps somewhat to simplify the complications of expansion. If you are thinking of taking your UAE company global and are targeting the United States, keep one of these businesses in mind to make the process easier.