Hatchimals, this year’s “Furby”, are one of the hottest selling toys of the year. They are sold out everywhere, going for 2x retail on eBay, and the manufacturer, or actually the private label owner, cannot keep up with demand. So what do they do?
Instead of shipping by sea like they normally do, they are resorting to expensive air freight to desperately try to get them on store shelves in time for Christmas. But in reality their shipments may not arrive until 2017. In fact I wouldn’t be surprised if they don’t arrive until Q2 of 2017 (remember Chinese New Year).
So as online sellers and Amazon private labelers, what can we takeaway from this?
I can share from my personal experience as one of the products we had manufactured in China is normally shipped by air from China to the US. We normally use Fedex and they offer two air freight delivery options: International Priority with 3-day delivery and International Economy with 5-7 day delivery. We normally ship by international economy to save on shipping costs as well as faster delivery and less customs clearance bureaucracy typical of shipping by ocean freight.
However we were informed this week (2 weeks before Christmas) that because of increased shipping volumes leading up to Christmas, Fedex’s International Economy option now had an estimated TWENTY (20) day delivery lead time. This is almost 4x their regular delivery time. And this puts it almost as long as shipping by sea!
On the other hand, the international priority option, while more expensive (about 40%), still kept to their original 3-day delivery lead time. Fedex is smart to drive more business to their premium shipping option during the most critical time of year.
Two weeks before Christmas, Fedex’s International Economy now has an estimated TWENTY (20) day delivery lead time. This is almost 4x their regular delivery time during non-peak delivery periods
As a result we decided to use the more expensive option to get the product delivered so as not to miss out on the end of the holiday shopping season.
Best practice: If you are expecting to ship product between now and Christmas you may want to double check with your freight forwarder to find out if they can maintain normal shipping lead times. In other words, no surprises.
Lesson learned – plan ahead to have your inventory shipped well ahead of the Christmas rush. This way you will not be forced to either take a hit on shipping fees or else lose out on holiday sales.