🛩️ How to optimize your cross-border logistics for the coming CMBF Season

Hey there, awesome D2C community folks who are out there doing some really cool stuff! This is your host Berkay writing.

🛍️🛍️ Yes yes yes! Here we go again… It's that time of year when D2C founders often find themselves scrambling to get all the inventory they need for the upcoming Cyber Monday - Black Friday season. That's why we're dedicating this week's newsletter to helping you make the most of your inventory and streamline your cross-border logistics, so you can navigate the holiday rush with ease!

Sooooo, where were we?

🛩️ Izzy Rosenzweig, Founder of Browze and Portless

🎙️ In the first season of our podcast, we've interviewed D2C founders and operators. But Izzy is more than just a D2C founder: He is also a supply chain guru!

He's been running Browze as the founder and CEO since 2012, and just last year, he launched a 3PL startup called Portless.

💪 Born into a family of small manufacturers, Izzy developed a deep appreciation for hard work and entrepreneurship when he was a small kid. He understood that customer satisfaction was the key to success in their business.

🏭 When the industry began to change with the rise of container shipping and globalization in the 1980s, his family didn't resist. Unfortunately, however, these changes forced his grandfather to go more and more niche, eventually leading to the closure of his business.

Drawing from a rich family tradition of building businesses and leveraging his network of key contacts, Izzy founded Browze in 2012 as an open marketplace. Over time, he transformed it into a more exclusive platform, prioritizing customer satisfaction above all else.

Recognizing the importance of this satisfaction and acknowledging air shipment became more efficient, he took a bold step by opening a fulfillment center in China. This move allowed for faster delivery and lower costs and eventually evolved to be a separate business by itself, Portless.

^{You can also listen to the episode on Spotify, Google, or Apple Podcast!}

And here are some highlights from our chat!

🏭 Growing up in a family of small manufacturers, Izzy learned two things:
1. Customer satisfaction is of paramount importance
2. Inventory management is the backbone of any business.
These were the things Izzy always kept in mind when he was building his own D2C brand, Browze.

👊 Working with the right people. Initially importing unbranded goods from overseas to Canada and the US, Browze's transformation into a global marketplace connecting Chinese sellers with worldwide customers started after meeting with Alibaba's former senior staff.

❌ Clashing interests and moving to a close market model. In 2016, Izzy shifted to a global focus and he established an open marketplace. However, he soon realized that sellers in open platforms prioritized sales over customer satisfaction. To address this, they transformed their marketplace into a closed one, becoming selective about partners and stringent about customer experience, even if it meant fewer products.

🛩️ When air shipping became efficient in the 2010s. In the past decade, something similar to the container shipping revolution in the 80s happened: Cross-border air logistics improved significantly. This led companies to improve their supply chains and increase their margins.

📦 Opening a fulfillment center in China. Wanting to take advantage of the changing industry dynamics, Izzy decided to open a fulfillment center in China in 2022. This move reduced delivery times to 5-6 days (US) and 5-7 days (UK). It also enhanced customer satisfaction and operational efficiency while maintaining a US-based consumer brand identity.

💰 Ultimately this is how Izzy and his partners started Portless. Browze's shift to opening a fulfillment center in China improved its profitability, cash flow, and customer satisfaction. And investors were quick to recognize that!

Portless eliminates container costs, waives import duties, and offers cost-effective shipping, improving cash flow. It leverages logistics expertise to assist D2C businesses with direct factory-to-customer shipping, enhancing profitability, and streamlining logistics and customer experience.

❓ But how does this work? A step-by-step guide to the Portless model.

1. Analyzing Shipping Costs: Assessing shipping expenses, particularly for products under a certain price, to identify immediate cost savings.

2. Exploring Cost Factors: Diving into factors like import duties, container costs, 3PL fees, pick and pack expenses, and related charges to understand total costs.

3. Considering Capital Costs: Highlighting the impact of tied-up capital during transit, as it affects various business aspects.

4. Focusing on Cash Flow: Emphasizing managing cash flow alongside marketing metrics to sustain and expand operations, recognizing its significance beyond profitability.

🛩️ Tips from Izzy for successful cross-border logistics operations

When I decided to focus this week's newsletter on cross-border logistics, I reached out to Izzy, who shared some valuable tips for successful operations. And here they are:

🤝 Ensure you have trusted partners who are fluent in the country's native language so that you can easily communicate with factories, suppliers, etc.

🏭 Inquire about your factory's production capacity and understand their maximum output per week. Make sure you familiarize yourself with your supplier's ramp-up and production lead times.

🧐 Research any potential restrictions for new products, such as the need for FDA approvals or high import taxes.

🤓 Familiarize yourself with the unique nuances of shipping to different countries (do you require a customer's tax ID? Do you charge VAT?), or at least work with a partner who understands them.

🆇 TWEETS OF THE WEEK

1. Helpful reminder

2. What are your top channels?

3. 😐

4. Hot topic of the week: Klaviyo’s IPO.

Late on Tuesday, Klaviyo priced 19.2 million shares at $30 each, giving the company a valuation of slightly more than $9 billion when considering all potential shares. Out of these shares, 11.5 million were offered by the company itself, resulting in an infusion of $345 million in cash into its financial reserves.

📣 PROMOTIONS - FABRIKATÖR INVENTORY ASSISTANT

We want to introduce you to some fantastic tools that bring incredible value to D2C brands. At the top of the list is Fabrikatör. Not only is it an excellent tool for predicting inventory needs, but Fabrikatör is also the sponsor that supports our work. 🙌🏻

🎺 Now, introducing Fabrikatör: Your Ultimate Inventory Sidekick!

Fabrikatör is your AI-powered strategic partner for streamlined eCommerce operations. It handles tasks with precision and offers backorder capabilities to recover lost sales and turn out-of-stock situations into growth opportunities. By bridging the gap between the supply chain, CRM, and your Shopify storefront, Fabrikatör ensures your customers are always satisfied.

🚀 Maximize Profits: Forecast demand effortlessly, turning stockouts into revenue.

🛍️ Pre-Order Power: Automate pre-orders, boosting sales.

🔄 Streamlined Operations: Effortlessly coordinate tasks and optimize inventory.

💌 Integration Excellence: Sync your supply chain with your Shopify storefront and Klaviyo.

Check out Fabrikatör at the Shopify app store! They offer a 14-day free trial and personal onboarding.

👥 SOCIAL MEDIA

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📚 FREE RESOURCES

And here are the free resources on all things inventory! Enjoy them and let us know what you think.

🏷️ DISCOUNTS ON LEADING APPS

If you’re a subscriber to this newsletter, well, we have more to offer. Just contact us over email to ask for a list of discounted tools, ranging from CX to inventory optimization.