Why More eCommerce Brands Are Moving Their Fulfillment to China
A massive sea change is happening in a world where almost half of mid-sized eCommerce brands in the US and Europe outsource their fulfillment to China fulfillment facilities: by 2027, the sales in the field are set to be above 6.5 trillion dollars (Statista, 2024). This move is not a hypothetical uproar, this is an order fulfillment strategy that is cost-effective and reduces costs by up to 60 percent, quicker Chinese shipments in less than 2-4 weeks compared to 8-12 weeks in the Western warehouses, perfect synergy with the massive supply chain resources and unequaled capacity to scale into high volume business. Companies that have taken advantage of eCommerce fulfilment fromChina have seen their average fulfilment costs lessen to less than 2 dollars per order in China, instead of the 4-6 dollars per order in the US thus reinvesting in marketing and product development. With the disappearance of supply-chain disruptions and the maturity of the logistics infrastructure in China, the outsource fulfillment to China is the new standard of achieving competitive advantage in the global eCommerce logistics.
The Core Reasons Driving the Shift to China Fulfillment
This trend is rooted in tangible, data-backed advantages that address the pain points of traditional Western fulfillment models. Here’s why savvy brands are making the move:
1. Dramatically Lower Fulfillment and Labor Costs
The labor market in china is still a forcehouse of cheap labor. Warehouse is paid between 5-7 per hour on average, which is in contrast to 20-25 in the US and 15-20 in Europe (Bureau of Labor Statistics, 2023; Eurostat, 2024). China warehouse services, in combination with subsidized energy and real estate, result in reduced fulfillment cost without compromised quality. A 2023 Jungle Scout study discovered that cost-saving under China 3PL overheads was 50-70% in comparison to 0.50 and above in the West for storage costs.
2. Proximity to Manufacturers Enables Faster Replenishment
In China, over 70% of the entire manufacturing is done (World Bank, 2023). In the case of colocation of the inventory in China fulfillment centers, the brands can get the inventory refilled in China faster- replacing Amazon or Shopify stock in 7-14 days via domestic trucking, compared to the time spent shipping in the ocean. This closeness helps reduce the cost of stockouts that cost eCommerce sellers 1.1 trillion each year (Aberdeen Group, 2022).
3. Access to Scalable 3PL Capabilities
The third-party logistics (3PL) market in China is booming with as much as 250 billion dollars in 2023 and increasing at a 15 percent per year (China Logistics and Purchasing Federation). One can hire massive warehouses (up to 1 million sqm) which can be expanded on-demand during peak seasons such as Black Friday. These are in contrast to fractured Western 3PLs, where China 3PL services offer end-to-end cross-border fulfillment services (meaning sourcing all the way to the final delivery) across the globe.
4. Cutting-Edge Warehouse Management Systems (WMS)
The third-party logistics (3PL) market in China is booming with as much as 250 billion dollars in 2023 and increasing at a 15 percent per year (China Logistics and Purchasing Federation). One can hire massive warehouses (up to 1 million sqm) which can be expanded on-demand during peak seasons such as Black Friday. These are in contrast to fractured Western 3PLs, where China 3PL services offer end-to-end cross-border fulfillment services (meaning sourcing all the way to the final delivery) across the globe.
5. Seamless Integrated Amazon FBA Prep Services
Amazon prep in China is a game changer to the Amazon sellers. Labeling, polybags, and bundling are done in certified centers according to FBA requirements and directly deliver to US/EU fulfillment centers. A 2024 study conducted by Helium 10 revealed that sellers that subscribe to these services reduced preparation expenses by 40 percent and saved $500K+ in storage expenses per year due to the production of overstockings.
6. Flexible MOQ and Batch Fulfillment Models
The traditional suppliers require high minimum order quantity (MOQs), whereas China dropshipping fulfillment companies accept low-MOQ batches (as low as 50 units) and manufacture on a just-in-time basis. The China dropshipping fulfillment model is best applied to the Shopify stores to test SKUs, and it is not necessary to tie up capital to accomplish agile testing.
Industry Trends Fueling the Boom in China Fulfillment
The surge in outsource fulfillment to China mirrors broader eCommerce evolution. Global cross-border trade hit $2.5 trillion in 2023 (WTO), driven by DTC brands seeking efficiency. In the US and Europe, labor shortages and wage inflation—up 20% since 2020—have eroded margins, pushing 35% of SMBs to remote fulfillment (eMarketer, 2024).
China’s response? Investing in smart logistics parks to the tune of 100 billion dollars and automating 50 percent of the operations by 2025 (State Council of China). The efficiency of the warehouses in Shenzhen and Guangzhou has now competed with Singapore, as drone sorting and AGVs reduce fulfilment periods. DTC companies such as Allbirds and Gymshark have also centralized their accordance by storing warehouses close to factories and cut carbon responses by 30 percent with fewer promising haulers.
The 60 percent of Shopify merchants, SMBs, depend more and more on hands-off operations in China. In a survey of Oberlo in 2023 55 per cent of dropshippers reported citing China as the area of operations, compared to 30 per cent of dropshippers in 2020.
The SMBs, which make 60 percent of the Shopify merchants, are now heavily dependent on China fulfillment in hands-off operations. A survey conducted by Oberlo in 2023 found that 55% of dropshippers identified China as their home when compared to 30% of 2020.
| Trend | Impact on eCommerce |
| Global eCom Growth | $6.5T by 2027; 25% cross-border |
| Western Cost Surge | US labor +25%; EU regulations add 15% overhead |
| China Automation | 60% warehouses AI-enabled; error rates <0.1% |
| SMB Adoption | 55% dropshippers use China; DTC chains shorten 40% |
Deep Dive: Analytical Insights into China vs. Western Fulfillment
Cost Structure Comparison
Consider a mid-sized brand shipping 10,000 orders/month:
| Cost Element | US/EU Fulfillment | China Fulfillment | Savings |
| Labor | $250K | $70K | 72% |
| Storage | $50K | $15K | 70% |
| Inbound Freight | $100K | $30K | 70% |
| Total | $400K | $115K | 71% |
(Source: Adapted from Deloitte Global Logistics Report, 2024)
Real-World Case Scenarios
The fashion brand Shein has transformed the eCommerce logistics worldwide by delivering to the globe, shipping out of Guangzhou, with a 7-day global delivery at 30 percent less than other competitors are doing. One of the electronics DTC sellers in the US converted to Amazon FBA prep in China, which cut overhead by USD300k and increased ROAS by 25% through quicker iterations.
Supply Chain Integration Benefits
Located around suppliers Warehousing develops a closed circuit ecosystem: source, store, fulfill in the same radium. This reduces the lead times by 50, improves the quality control, and allows predictive restocking through shared APIs.
Why China is the New Fulfillment Hub
In the case of Amazon, 40% of the inventory in APAC FBA is prepared by the 3PLs in China. Shopify applications can be connected to cross-border fulfillment solutions such as Depop Ship as the two are built in. DTC brands have advantages of the expertise of the private labeling with 80 percent of the consumer goods of the world being produced in China.
Frequently Overlooked Benefits of China Fulfillment
Beyond basics, China fulfillment centers excel in nuances:
- Faster SKU Handling and Relabeling: Multi-language labels and 24-hour turnaround for 1,000+ SKUs.
- Lower Storage at Scale: Tiered pricing drops to $0.10/cu ft for 100K+ units.
- Superior Packaging and Kitting: Custom inserts, eco-materials, and gift-wrapping at $0.50/order.
- Real-Time Tracking and API Integration: Seamless sync with Shopify, WooCommerce via RESTful APIs.
- Flexible Models: Tailored for dropshipping (zero inventory), wholesale (bulk splits), and private label (branded kitting).
These features enable hyper-personalization, with 70% of users reporting 20%+ customer satisfaction gains (Forrester, 2024).
For brands seeking top-tier options, explore China eCommerce fulfillment services from vetted providers.
Challenges in Adopting China Fulfillment—and How to Overcome Them
No shift is seamless. Key hurdles include:
- Times and Communication: 12-15 hrs differences. Solution: Implementation of such tools as Slack/WeChat integration and English-speaking account managers; overlapping calls.
- World Logistics and Customs: Tardiness caused by duties/tariffs. Alternative: Outsource (DDP, Developed Duty Paid) 3PLs; use bonded warehouses to avoid taxes.
- Quality Assurance: Checking with untrustworthy partners. Resolution: Assess through ISO certification, location inspections, customer reviews and test deliveries. Check measurements: 99.0% and below 2 day process time, API is in use greater than 99.5%.
Begin on such a pilot: Ship 1,000 orders to try. Reliability is ensured by such tools as Freightos to obtain quotes and Avalara to comply.
Conclusion: Positioning Your Brand for the China Fulfillment Era
The exodus to China’s fulfillment process is irreversible and driven by the cost efficiencies, speed and technological superiority that the western models can never handle. With the tariffs at even levels and the Belt and Road projects spreading, the adoption will reach 60 percent by 2027. The brands ought to perform the audit of existing costs, test China 3PL services, and invest in API-based visibility. Adaptors will rule eCommerce logistics in the world; slow movers will face the risk of being phased out. The future? A hyper efficient supply chain that is China-centric and fulfillment is not a cost center, it is a profit center.
