Unless your Amazon FBA inventory is getting flown in air express, your shipping quotes both in time and money are almost guaranteed to be so high they’re basically satellites.
Can anything be done to ease this burden?
Today, I’m going to show you Amazon Global Logistics and how it can save your FBA business both time and money.
1. What is Amazon Global Logistics?
Remember when the world shut down in 2020?
Among the myriad of other problems that caused, international shipping timelines and costs increased exponentially. We’re talking sea freight quotes for full container loads jumping from the $3,000-$6,000 range to, in some cases, the $20,000-$60,000 range 😵
Safe to say, the supply chain was so out of whack, it became unsustainable, especially for smaller businesses like individual Amazon sellers.
Amazon, not immune from these issues, announced in April of this year that they would add a temporary fuel and inflation surcharge to FBA fulfilled products, which irritated many sellers.
Now, Amazon is throwing them a lifeline: their own shipping line, Amazon Global Logistics.
Simply put, Amazon Global Logistics (AGL) is a service offered by Amazon to their third party sellers (sellers like you and I) that allows them to ship inventory directly from their supplier to an Amazon FBA fulfillment center.
AGL is meant to both reduce your overall international shipping costs and expedite shipping timelines. The program offers competitive rates to other sea and air freight carriers (the two current shipping methods offered through AGL) and allows you to track your shipments in real time, so you can say adios to wondering if and where your inventory is somewhere above the Pacific Ocean.
AGL is offered for shipments transported via normal sea freight, fast sea freight, and air freight. Fast sea freight provides an intermediary option between lengthy normal sea freight timelines and the pricier tag of air freight.
Additionally, with AGL, you can have Amazon pick up your inventory from the supplier, pack it onto pallets, label it, buy cargo insurance for it, and connect with customs brokers to expedite your inventory through customs at its port of entry.
Currently, AGL is only available for FBA fulfillment centers in the US, the UK, the EU, and Japan, although it’s sure to expand to more marketplaces and sellers as Amazon grows. Amazon understands that it’s not just these higher-profile, more consumer-driven economies that require relief from engorged shipping prices.
2. How can Amazon Global Logistics save you thousands in shipping costs?
Oftentimes, Amazon sellers (including many of our students) rely on third party freight forwarding companies to get their products from China (or wherever they’re manufactured) to their Amazon fulfillment center. The freight forwarder then finds those sellers another company to physically ship the inventory, who the sellers also must pay.
AGL allows you to skip the double payment, the middleman, and—arguably most importantly—the confusion and risk of mess up.
With AGL, you pay Amazon to ship your products, easy-peasy.
Amazon takes it another step simpler: You don’t have to scour the internet for freight forwarders. You don’t even have to visit a second webpage. You can apply and pay for your shipment through your Amazon Seller Central account 🤯
But apart from ease and convenience, is it truly worth it to leave yet another part of the FBA process to Amazon? Why should you pay Amazon even more money?
AGL reduces the risk of inventory rejection upon arrival at Amazon fulfillment centers, and thus delays. Amazon already takes dozens of steps to ensure proper and timely delivery at fulfillment centers—including delaying your items due to missing certification requirements. It stands to reason that if Amazon transports your shipment and knows what’s in it exactly (which they should if you’ve properly submitted your shipping plan), you can expect a painless receipt that allows you to go on-sale faster.
AGL allows you to charge your Seller Central account balance directly. Rather than receiving your payment from Amazon, waiting for it to pay out to your business’s bank account, and then writing a check to your freight forwarder, simply take the money you make on Amazon directly and put it to use for shipping. While this is a newer program, I’d be willing to bet that your payments to AGL show up on your Amazon FBA fees report.
AGL gives you access to competitive shipping rates to reduce your shipping quotes. AGL often moves products more quickly and less expensively than a shipping company through a freight forwarder.
A note on speed and cost: AGL will not always be the fastest, least expensive option. We have seen AGL fail on both of these accounts 20% of the time.
On the flip side, 80% of the time we see AGL beat third party providers by at least 15% in terms of both cost and speed. Considering the astronomically high quotes I and our Just One Dime members have seen, I’m heavily inclined to take those odds.
It’s like this: If a third party provider quotes you $50,000 to ship products from China to the US, there is an 80% chance your AGL quote will likely be $42,000 or less. Sure, that’s still a lot of money…but it’s less than 50k.
Additionally, that means your business gets to keep an extra $8,000 that can now go to advertising costs, another batch of inventory, or even a brand new product. Regardless, you get to put that money towards growing your business so that it can make you even more money 💵
Furthermore, consider recent shipping lead times:
85 days on average from China to the US?!? That’s three months.
By using AGL, you don’t just save money, you make money…with reduced shipping timelines.
Getting your products to Amazon faster not only saves you an anxiety attack every time your inventory dips, but can also get you on sale faster which means you can make more sales sooner. This can give you a huge boost over your competitors.
Another trick that can give you a leg up on the competition? Proper Amazon FBA training.
Our Amazon FBA Mastery membership is your comprehensive guide to starting, launching, and growing your very own successful Amazon FBA business. Our coaches will help you one-on-one with your specific goals; our community will give you all their best kept secrets and recommendations; and our training will continuously show you not just how to sell on Amazon, but how to expand into all the new programs Amazon is launching.
That’s dozens of opportunities to make passive income all wrapped up into one platform. Get the best training for that platform to start your journey to financial independence.
3. How do you set up your Amazon Global Logistics account?
Login to your Amazon Seller Central account.
Navigate to the three menu lines in the top left corner.
Under Growth, select Explore Programs.
Under Recommended programs, click Fulfillment.
Under Amazon Global Logistics, click Learn More.
Select No: complete onboarding.
Click Create new account.
From the Setup tab, click Set up payment method.
From the Payments tab, click Pay in USD.
Click the Importer of Record (IOR) tab.
The IOR is the business creating and importing the shipment—you, or at least your Amazon business.
If you have either an EIN (Employer Identification Number) or a CAIN (Customs Assigned Importer Number), click the button Yes, the importer has an EIN or CAIN.
CAINs are for non-US companies without an EIN.
Enter your EIN or CAIN in the box and click Next.
If you have neither an EIN or CAIN, select the option No, the importer does not have CAIN. Request one for me.
Check the box I’m sure I want Amazon to request a CAIN for me and click Next to follow the instructions for acquiring your CAIN.
Once you’ve entered your EIN or generated your CAIN, click Add a new importer entity contact.
In the popup window, click Add contact.
Enter your contact details with the following caveats:
- Your Company name must match the full legal name of your company.
- Your Primary contact name must be the same exact name—in the same exact spelling and format—as the primary contact name for your Amazon seller account. This means that if you entered your account’s primary contact name as Bobby L. McGee (L with a period), you must enter it the same way in AGL. You certainly wouldn’t use Bobby L McGee (L sans period) 🙄
Click Add contact.
Under the field Does this importer of record have a DBA (doing business as) company name, select No.
In the section IOR Power of Attorney (POA) Details,
Click the dropdown menu POA Signer role and choose your title within your company. In most cases, this should be President. Amazon does not accept all roles for POA, so we recommend President to be sure.
In the POA Signer’s name field, type your name.
In the POA Signatory email field, type your email address on file with Amazon.
You will receive an email at that address in which you will again select your role within your company. Ensure you choose the exact same role as entered in the online form.
From the field Has the IOR imported before?, select No, unless you have already imported under your name (and not a third party provider’s).
Select an option from the dropdown menu How often will the IOR import in one year, including both Amazon and non-Amazon imports. I recommend 1-4 times per year, however it depends on your business’s actual needs.
From the field Does the IOR have a continuous customs bond?, select No, unless you have already purchased a bond.
Click Buy bond.
You should now see a US Customs bond purchase pop-up window.
You must pay customs fees (import duties, taxes, etc.) anytime you ship products from one country into another. These fees pay the salaries of US Customs and Border Protection (CBP) officers for the work of inspecting all imports.
A customs bond is a form of insurance that guarantees that the CBP will be paid as promised once the imports reach the US border (or port of entry in most FBA cases). When you pay the bond, its fee goes to a surety (similar to insurance) company who now guarantees for you that if the CBP needs that payment sooner than you (the importer) can provide, that surety company will immediately pay CBP that fee, thus avoiding delays for you.
That was a lot of heavy info. It all boils down to this: customs bonds facilitate your inventory’s faster passage through customs because the CBP can get paid as soon as they require, even if there’s a holdup on your end.
Another AGL plus is when you set up your bond, AGL will automatically bill its fee to your seller account or deduct it from your current balance.
How much money are we talking, exactly?
Customs fees typically fall in the low hundreds, but only CBP gets final say, shipment by shipment.
As for the question, Do I really need a customs bond?—a bond is required whenever the shipped goods are valued over $2,500. Additionally, some products require a bond for their sheer nature, such as food items, regardless of their value.
Customs bonds last for one year. To maximize this use, AGL will purchase a Continuous customs bond for you the same day you create your first AGL shipment. This bond will cover up to $50,000 and cost you $350 annually.
Enough with bonds—back to the how-to!
In the Description box, write a description including the category of your shipment’s products. This doesn’t have to be an Amazon-specific category and you can be broad—”household furniture”, “pet cleaning” or “building block toys” would all be acceptable.
In the field For the IOR, how much in duties, taxes and fees are they expecting to pay in the next calendar year?, select Less than $500,000 USD, unless you do expect more.
In the field Are any of your commodities subject to anti-dumping duties or countervailing duties?, select No, unless your products require HAZMAT certifications.
In that case, choose Yes.
Click Confirm purchase.
Enter your email address in the field and click Next.
Carefully review all of your information for accuracy. If something doesn't match exactly, your application may be rejected, extending the timeline to get your AGL account set up from days to weeks 🙃
Click Confirm details.
Click Confirm in the subsequent popup window.
You now have the option to upload your certificate of filing, business license, or EIN Assignment statement from the IRS
Here’s what a certification of filing looks like, by-the-way:
And here’s what an EIN Assignment looks like:
If everything is successful, you should receive three emails from Amazon throughout this process:
1. Amazon Bond Purchase Notice Letter
This email comes after you have completed your AGL application to inform you of the receipt of your request for Amazon to purchase a Continuous customs bond as part of IOR setup with AGL.
This email might look like this:
Note that the AGL team is located in China, hence the Chinese characters.
This email is for informational purposes only and does not require a response.
2. Request for power of attorney
This email is a request for your company to give AGL power of attorney to act on your company’s behalf in the shipment and importation of your products. It might look something like this:
You will sign this document digitally. Remember when I said you would repeat the selection of your “role” (likely President) in your company in an email? That’s here.
3. Signed power of attorney
This email confirms the receipt of your signed power of attorney with an attached copy of the agreement.
Your CAIN will be at the top of this POA if you requested that CAIN through this process.
The email might look like this:
Once your AGL account is set up, the last step is to book your shipment from seller central.
Like to learn more about this process (or your other shipping options)?
Visit JOD.com/apply to speak with a member of our team to learn about our Amazon FBA Mastery membership. Our program will help you build, run, and expand your own Amazon FBA business start to finish so that you can build margin to do the things you love with the people you love.
Will you jump aboard the Amazon Global Logistics train 🚂? Let me know in the comments.