Shipping and Logistics Archives - Page 3 of 10

Shipping Direct From China: Pros And Cons of Models Like Portless

What Direct From China Actually Means
The Real Benefits In 2025
The Pitfalls Everyone Underestimates
When Direct From China Makes Sense
When You Should Avoid It
A Simple Model To Pressure Test The Idea
Buying From Manufacturers Without Getting Burned
Returns And Customer Care
What I Would Do Before Flipping The Switch
How Portless-Style Models Work, And Why 2025 Changed the Game
The Bottom Line
Frequently Asked Questions

Direct from China sounds like cheat codes. Inventory sits at the China factory, orders flow, parcels fly, and you pocket the cash before you pay duties. In a soft demand cycle, that cash-flow relief is real. But in 2025, the rules changed. Tariffs moved, the de minimis door is closed, and customer expectations got even sharper. I want to lay out where the direct from China model shines, where it hurts, and how to run the numbers before you commit.

What Direct From China Actually Means

At a simple level, you store finished products inside China, then ship parcels directly to end customers when they buy. No US warehouse, less capital tied up, fewer bulk shipments. Most brands ride a network of special lines that consolidate in China, inject into local postal networks on arrival, and deliver with full tracking. For lightweight items and steady demand, it can be a smart bridge between prototype and scale.

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The Real Benefits In 2025

1. Cash flow and lower working capital: You pay import taxes against revenue that has already been cleared, rather than prepaying duties on bulk containers. That can be the difference between testing ten products and testing two.

2. Faster product iteration: When manufacturers can ship samples and micro batches quickly, product teams learn faster. You avoid months of wrong inventory sitting in a US warehouse.

3. Flex on assortment: If the factory can kitting-pack on demand and hold multiple main products, you can widen the choice without buying deep. That matters when quality, color, and size curves are still unknown.

4. Potentially competitive transit times: Special line carriers like YunExpress or 4PX can hit 6 – 12 days to the US with trackable milestones. Not Prime-fast, but fast enough for certain categories if expectations are set.

The Pitfalls Everyone Underestimates

1. Tariffs, duties, and the end of de minimis: As of late August 2025, low-value shipments no longer slide through the US under the $800 de minimis treatment. That means most parcels face duties and fuller customs handling. If your pricing assumes duty-free delivery, your margin math is off. Some marketplaces will also treat you like a full importer, with extra data and security requirements.

2. Delivery experience and returns: Even good special lines are not domestic carriers. Weather holds, customs inspections, and routing shifts happen. Returns get expensive and slow when the origin is China. For apparel and accessories, that is a churn magnet.

3. Quality control without a US backstop: Product quality must be locked at the factory. If you discover a defect pattern in the wild, you eat replacements and international shipping. Vet your manufacturers, run pre-shipment inspection, and keep signed samples. Poor vendor management equals public one-star reviews.

4. Compliance and paperwork risk: Incorrect declared values, missing test reports, or flimsy certifications will jam parcels at the border and trigger audits. If you sell anything with batteries, skincare actives, magnets, or electronics, be extra careful. The cost is not just duties; it is time and trust.

5. IP and data exposure: When your suppliers or trading companies also serve other websites and buyers, opacity creeps in. You want clear contracts, controlled packaging files, and watermarking on pre-release assets. Keep sensitive information on company systems, not shared chat apps.

When Direct From China Makes Sense

Small and light products that fit under key postal thresholds.
Predictable quality with low return rates.
Clear HS codes, clean certifications, and no hazmat.
Customers are willing to accept 6 – 12-day delivery with honest ETAs.
A brand in test-and-learn mode that values cash conservation over fastest speed.

When You Should Avoid It

High-return categories like apparel with tricky fit or color variance.
Regulated categories that draw extra inspection.
Anything where product quality needs rework, steaming, or special packaging inspections.
Premium brands that rely on two-day promises as part of their brand identity.

A Simple Model To Pressure Test The Idea

Pull a one-page table for your top five SKUs. For each, estimate: unit cost ex-factory, packing, special-line shipping, new duty rate, customs fees, and a realistic returns rate. Add a buffer for loss and non-delivery. Compare against US-based fulfillment: inbound ocean or air, drayage, duty on bulk import, warehouse storage, pick and pack, domestic label, and expected return cost. Whichever total cost per delivered order looks lower at your current order volume, that is your baseline. Then add two sensitivity tests: duty plus five points and transit plus four days. If your margin collapses on those, think twice.

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Buying From Manufacturers Without Getting Burned

Choose suppliers with clean third-party audits and consistent certifications.
Pay for pre-shipment inspection and carton drop tests.
Start with small bulk orders to validate actual defect rates before flipping to full direct from China.
On custom packaging, confirm materials and print proofs with the factory, then lock revisions in writing.
Keep key contracts clear on ownership of molds, brand assets, and tooling.

Returns And Customer Care

Two tactics help. First, route returns to a domestic partner that can triage, refurbish, and reship, so customers do not wait months for exchanges. Second, publish an accurate delivery window at checkout, not a best-case. If you are targeting 7 – 12 days, say 8 – 14 and beat it. Your return rate will thank you.

What I Would Do Before Flipping The Switch

Map your HS codes and confirm duty exposure for each SKU.
Run a four-week live pilot on a subset of traffic and measure conversion, delivery time, and refund rate.
Build an exception playbook. Who handles lost parcels, re-labels, or address issues?
Decide your future state. Many brands blend models: direct from China for long tail SKUs and testing, US warehouse for heroes. That hybrid often wins.

How Portless-Style Models Work, And Why 2025 Changed the Game

Portless and similar platforms pitch a turnkey promise: skip the US warehouse entirely, tap into a China-based network of factories and forwarders, and let them handle order routing and fulfillment to global customers. It’s an evolution of the factory-to-door model layered with software that syncs with your store, automates label creation, and consolidates shipments into fast cross-border lanes.

Why sellers loved it: The model eliminated bulk import headaches, cut upfront inventory costs, and gave smaller brands access to reliable shipping lanes without building their own infrastructure. For many, it was the fastest way to test new products, manage long-tail SKUs, and keep cash liquid.

But the landscape shifted in 2025.

De Minimis Crackdown: With the US closing the $800 de minimis loophole, Portless-style models now face the same duty requirements as bulk importers. These costs erode the pricing advantage and introduce customs complexity that such platforms used to shield sellers from.
Data Transparency Requirements: Marketplaces and regulators now demand full product-level data (materials, certifications, HS codes) before entry. Platforms relying on minimal compliance paperwork are scrambling to upgrade.
Competitive Pressure: As more players adopt this model, differentiation shrinks. Portless itself competes not just with peers like Floship or ShipAnt, but also with traditional 3PLs that have added China-direct options under a hybrid approach.
Customer Experience Risks: While tech-driven platforms offer visibility, they’re still subject to cross-border realities, customs holds, weather delays, and return complexity. With rising consumer expectations, “almost Prime” isn’t enough for many categories.

For brands, this means due diligence is non-negotiable. Evaluate not just rates and transit times, but how your provider is adapting to new regulatory and market pressures. The Portless model can still deliver value, but only if paired with solid compliance, quality controls, and a backup plan for domestic fulfillment.

For platforms like Portless, BoxC, and the like, the message is clear: adapt or lose ground. Sellers will demand end-to-end transparency, multi-country node options, and automated duty/tax calculation baked into the experience. Those who can’t provide it risk being replaced by hybrid providers that combine offshore flexibility with domestic speed.

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The Bottom Line

Direct from China is not a fad; it is a tool. A tool that works best for light products with clean compliance and patient customers. Cash flow improves, assortment expands, and learning accelerates. But tariffs are real, returns are painful, and one weak link in quality or paperwork can erase the savings. Treat this like a finance project, not a vibe, and it can be a competitive edge.

Frequently Asked Questions

What Changed About De Minimis And Why Does It Matter?

The US suspended the duty-free treatment for low-value shipments, so most small parcels now face duties and fuller customs processing. If your pricing relied on duty-free entry, your margin will shrink unless you adjust prices or shipping strategy.

How Fast Is Direct From China?

Most special lines deliver in roughly 6 to 12 days with tracking. Plan for longer windows if you sell during peak periods or route through congested gateways.

What Products Fit This Model Best?

Light, durable goods with low return risk. Think accessories, small electronics with clean certifications, or non-fitted home goods. Apparel with high return rates is usually a bad fit.

Can I Mix China Direct With A US 3PL?

Yes. Many brands use factory-to-door for long tail and keep top sellers in US warehouses for two-day promises and easy returns. That hybrid balances cash flow and customer experience.

How Do I Control Quality Without A US Backstop?

Pay for pre-shipment inspections, hold signed golden samples, and run acceptance testing per lot. If you see defect rates creeping up, stop shipments, investigate at the factory, and revert to US fulfillment for affected SKUs.

Written By:

Jeremy Stewart

Jeremy Stewart leads customer success at Cahoot, helping merchants achieve high-performance logistics through smart technology and process optimization. With a background in both ecommerce operations and client services, Jeremy ensures that every merchant using Cahoot gets measurable results—whether they’re scaling from one warehouse to many or managing complex returns.

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Shipping Rate Negotiation: Small Businesses Winning Better Rates in 2025

I’ve been talking to small business owners lately, brands pushing $200K/year in shipping, and guess what? They’re getting discounts once reserved for Amazon-level volume. Yep, FedEx and UPS are wooing smaller shippers these days, because parcel volumes are dropping and carriers need your business. That means you can play a smarter game: negotiate shipping rates with data, with options, with confidence, not by chance. Freight rate negotiation is now a strategic process accessible even to smaller shippers, allowing them to secure more favorable rates through preparation and informed discussions.

Let’s dig into how shipping rate negotiation really works. This is not your grandpa’s negotiation; data, technology, market leverage, and clear processes are your weapons. These tools give small businesses a competitive edge in negotiations. And I’ll show you how to use them.

Before we dive in, remember: having a clear shipping strategy is essential to maximizing your negotiation outcomes.

Why Now Is A Sweet Spot for Negotiation

Here’s a little nugget from the Wall Street Journal: FedEx and UPS are now offering meaningful discounts, even to shippers with under $500K in annual spend, because parcel volume has dipped, and they want to woo volume with rates, not rocket fuel. In fact, they dropped ground parcel prices by 2.5% in the latest quarter, thanks to lighter packages and aggressive targeting of small businesses. The main focus of these negotiations is the freight rate, which determines your overall shipping costs.

This matters because you’re not too small anymore. If you can articulate your shipping profile, volume, box size, lane mix, and distance traveled, you’re at the negotiation table. Carriers consider various factors such as volume, box size, and distance traveled when determining your eligibility and leverage. And they’re listening. That’s your edge.

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The Data Strategy That Will Win You Rates

You can’t negotiate what you can’t measure. That means build a shipping profile:

Monthly and seasonal volumes
Average weights, dimensions
Delivery zones (local vs residential vs international)
Service mix (Ground, Express)
Historical surcharges exposure
Detailed data on shipments and costs
Historical rates for similar shipments

Providers like TransImpact and Cahoot help you package that data in tables and visuals that carriers understand instantly. These platforms also provide insights into your shipping patterns and costs.

Armed with that, you’re not guessing; you’re showing them they’ll win by giving you better terms, especially when you include carrier performance metrics to strengthen your negotiation position.

Secrets for Smarter Negotiation (Not Just Talking)

When negotiating shipping contracts, understanding what negotiation takes, such as thorough preparation, leveraging accurate data, and understanding carrier priorities, can make a significant difference in your outcomes.

1. Benchmark your rates – See what peers are paying. Use industry groups or public references to position your ask (“My competitor in XYZ is getting 8% off freight, can you match?”). Focus your negotiation efforts on key spend areas to maximize impact.

2. Understand carrier cost logic – Fuel surcharges, DIM weight, remote zones. Knowing these gives you angles to push: “If you waive DIM on a 12-inch item, I can drop 5% overall spend.”

3. Negotiate accessorials separately – Detention fees, address correction, liftgate. Carriers love bundling; you should unbundle.

4. Use multi-carrier leverage – If USPS is cheaper for your light parcels, say so. Let UPS/FedEx know; they don’t like losing lanes to postal networks. Negotiating rates with multiple carriers can help you secure lower rates (more favorable rates) for your shipments.

5. Watch contract terms – Commit to a carrier for a volume guarantee in exchange for a better base rate or waived surcharges. Be crystal clear on the term, volume, and exit right. Negotiate for more favorable terms, including payment terms, service agreements, and volume discounts as part of your long-term agreements.

Always aim for the best possible terms and seek rate reductions where possible to optimize your shipping costs.

Ongoing Tactics That Multiply the Savings

Rate shop regularly – Rates shift weekly. Monitor and push adjustments mid-contract. Compare multiple carriers and different carriers to secure more competitive rates, leading to significant savings.
Invoice audits = hidden gold – Use tools or 3PL data to catch surcharges, billing errors, and renegotiate or reclaim them. Auditing shipping invoices helps reduce costs and control shipping expenses.
Test regional or hybrid carriers – They often undercut national carriers, especially for local or B-city lanes. A/B test them quietly, and consider different transportation modes for a cost-effective way to optimize operating costs.
Cheaper packaging saves percentage points – Cut DIM weight with smarter materials and save postage with no change to shipping speed.

These ongoing tactics drive cost savings (significant savings) over time. Leveraging technology and process improvements can also streamline operations and enhance shipping operations for even greater efficiency.

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When to Walk Away

If your baseline margin is too thin, even a “discounted” rate still kills profit; it’s fine to say no. Your goal isn’t just “save on shipping,” it’s “protect the margin.” Be ready to walk. This can put you in a stronger position during negotiations, especially if you have a deep understanding of your shipping needs and costs before making the decision to walk away. It refocuses carriers on your value, not desperation.

What To Do First Thing Monday

Pull your last 6 months of shipping data and sketch a profile to identify opportunities for negotiation and cost reduction.
Use rate-shopping software or Cahoot-like platforms to auto-compare.
Email your carrier account manager: “Let’s review my T1 rates. I’m seeing aggressive pricing in the market for small shippers.”
Ask for accessorial waiver proposals or season-based incentives.
Audit your last month of bills for unexpected surcharges or weight adjustments.

Bottom Line

Your shipping rate negotiation isn’t about volume; it’s about value. You bring well-packaged data, clear lane logic, and a willingness to shift to whichever carrier rewards you with better terms. The playing field is tilted your way right now. Use it; these strategies set you up for successful negotiations and better outcomes.

Frequently Asked Questions

What’s the single most important prep for negotiating shipping rates?

Build a shipping profile that outlines your volume, zones, surcharge history, and service mix. Data is your ticket to credibility at the negotiation table.

Can really small businesses get discounts too?

Yes. Carriers like FedEx and UPS are offering discounts to smaller shippers (<$500K spend) right now; they need the volume, you need the edge.

Should I commit to one carrier long-term for better rates?

Only if you’re confident you hit forecasted volume and get a rate break or surcharge waiver. Make the terms explicit: volume thresholds, penalties, and exit clauses. While committing to a single carrier can simplify operations and potentially secure better rates, relying solely on a single carrier may reduce your flexibility and negotiation power compared to a multi-carrier approach.

How often should I renegotiate?

Every quarter, if possible. Rates and surcharges move fast. Quarterly check-ins and invoice audits help you catch leaks and push for adjustments mid-cycle.

What’s better: deepest rate or multi-carrier flexibility?

Start with the deepest rate per lane, but build flexibility. Always seek the best rate for each shipment to ensure cost-effectiveness. Carriers love loyalty, but over-dependence locks you in. Rate shop dynamically to maximize savings.

Written By:

Jeremy Stewart

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Freight Fraud: Why Logistics Professionals Need to Stay Vigilant

The Freight Industry’s New Risk Math
How The Most Common Scams Really Work (And Where Teams Trip)
What I’d Implement Tomorrow If I Owned Your Brokerage (Or Fleet)
Why The Fraud Curve Keeps Rising (And How To Bend It)
Tools And Practices I Trust (And How I Deploy Them)
What To Update In Your Contracts
The Bottom Line
Frequently Asked Questions

Freight fraud isn’t one scam; it’s a whole category of criminal business models feeding on a hyper-competitive, digitized freight industry. I’m talking identity theft of legitimate carriers, double brokering that ends in non-payment, fake profiles on load boards, and cargo theft that disappears shipments and dollars annually. If you touch loads, broker, carrier, or shipper, you’re in the blast radius.

I run logistics with a simple rule: assume bad actors are probing your systems every week. Not because you’re special, but because the freight industry itself is a target-rich environment. Fragmented systems, undertrained teams, pressure to cover loads now, and lots of sensitive information moving through email. That’s catnip for fraudsters.

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The Freight Industry’s New Risk Math

Everyone feels the squeeze: rates down, fuel up, customers impatient. Hyper-competition creates more opportunities for shortcuts. Shortcuts create more openings for fraud. The logistics industry isn’t dealing with one-off incidents anymore; we’re living with a persistent threat where sophisticated schemes evolve faster than most companies update their practices.

Let’s call it what it is: freight fraud costs are rising, and the fraudsters are getting bolder. Double brokering, payment fraud, cargo theft, and identity theft now show up in various forms, compromised login credentials, spoofed emails, sold or stolen MC numbers, counterfeit COIs, cloned carrier websites, and even deepfaked voices on “verification” calls. The logistics sector’s old playbook, trust the paperwork, move the load, no longer maps to reality.

How The Most Common Scams Really Work (And Where Teams Trip)

1. Double brokering that turns into non-payment

A re-broker posts a fake or hijacked load, books a real carrier, and either never pays the carrier or swaps in a ghost carrier midstream. You’ll see mismatched domains, urgent tone, vague driver information, and last-minute banking changes. Freight brokers fall when the verification process is rushed or when one person is allowed to override policy “this one time.”

2. Carrier identity theft and fake profiles

Fraudsters impersonate legitimate carriers, sometimes with real DOT/MC details and a cloned website. They’ll provide doctored insurance and driver info, then vanish after pickup. Tell-tale signs: phone numbers that don’t match official listings, Gmail addresses on “legitimate carriers,” and COIs that don’t verify with the insurer.

3. Cargo theft with clean paperwork

Organized groups use social engineering to become the real broker on paper, then redirect a shipment to a shell yard. Legitimate carriers get stuck in the middle, shippers blame “the broker,” and recovery becomes a long shot. Metals, consumer electronics, food and beverage, apparel, high-value, easy-to-fence categories are red hot again.

4. Payment fraud that drains financial stability

BEC-style email compromises reroute payments. Fraudsters slip into threads, swap ACH details, and collect. If your AP team isn’t verifying identities with out-of-band call-backs, your “real broker” might be paying the wrong account for months.

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What I’d Implement Tomorrow If I Owned Your Brokerage (Or Fleet)

This isn’t theory. It’s a practical verification process that protects operations without killing speed. Train employees; write it down; audit it monthly.

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1. Identity and intent verification (every new partner, every time)

Verify carrier identity from official sources, not the email signature. Use FMCSA SAFER, the carrier’s own website, and insurer call-backs to numbers you locate, not numbers they provide.
Require real-time photo ID for the driver and dispatcher on video. Keep the call recording with the load file.
Confirm COI straight with the insurance agent, not a PDF attachment. No exceptions.
If the email domain is generic (Gmail, Yahoo), treat it as high risk even if everything “checks out.”

2. Dedicate one person to kill switches

No last-minute banking or payment changes without an out-of-band phone verification to a known number on file.
Suspend credit immediately if a partner refuses insurance verification or won’t do a quick video handshake.
Lock payment terms until a first successful shipment clears without incident.

3. Secure your systems like you secure your yard

MFA everywhere: TMS, load boards, factoring portals, email, cloud storage. If a login doesn’t support MFA (Multi-Factor Authentication), replace it.
Restrict who can view full load details. Use role-based access so a compromised seat can’t harvest your entire book.
Monitor for exposed credentials. If a password shows up in a breach, rotate immediately and re-train the user.
Backstop with an allowlist of company-approved tools. No rogue spreadsheets with driver information on personal devices.

4. Tighten the load board workflow

Build a “trust tier” for carriers, legitimate carriers you’ve vetted get first look at freight. New or unverified carriers go through the long-form checklist every time.
Use watchlists and industry networks to screen for known bad actors. Share your own intel back to the network.
Hide certain sensitive information in initial posts. Reveal pickup location and shipper name only after verification.

5. Pick up security measures at the dock

Two-factor pickup: photo ID matches the driver’s info on file, and the truck’s plate matches what dispatch provided earlier.
Geofence the pickup and capture a geo-tagged arrival photo in your app.
Use one-time PINs at handoff. Record BOL photos and seal numbers in the app; require the driver to sign digitally.
Train warehouse staff on scripts and escalation. If anything smells wrong, the shipment waits. Period.

6. Payment controls that actually prevent loss

Micro-deposit verification for new bank accounts and changes to vendor records.
Segregate duties: the person who verifies bank changes is not the person who releases payments.
Factor with visibility. If you factor, require that your factor run separate fraud checks on re-brokers and carriers.

7. Tabletop drills and train employees quarterly

Run 60-minute fraud drills every quarter: fake COI, spoofed phone, urgent re-route request. Measure time-to-catch.
Post a one-page “what to do if you suspect fraud” near every ops seat and warehouse desk.
Celebrate the catches; don’t shame false positives. The goal is culture: stay vigilant.

Why The Fraud Curve Keeps Rising (And How To Bend It)

First, the logistics industry has gone fully digital, but most companies still work like it’s 2015. Multiple sites, remote teams, and outsourced partners create more seams for fraudsters to pry open. Second, identity makes or breaks almost every scheme. If you get good at verifying identities, people, companies, and vehicles, you defang most fraudulent activities before they start. Third, speed pressure. When the supply chain is tight and customer SLAs are aggressive, a fake “carrier with a truck nearby” looks like a gift. That urgency is the weapon.

The counterplay isn’t fancy. It’s repeatable verification, security measures that are boring on purpose, and an operations culture that rewards caution. Industry networks help too. When brokers and carriers share signals, bad phone numbers, fake profiles, and stolen driver information, the whole community gets harder to crack. I’ll always choose a slightly slower start to a shipment over paying for a stolen load later.

Tools And Practices I Trust (And How I Deploy Them)

Identity-centric platforms: Tools that cross-check DOT/MC, insurance, safety, equipment, and contact footprints help spot anomalies fast. Use them to flag identity theft and double brokering in real time.
Risk dashboards: Cargo theft heat maps and alerts inform pickup scheduling, route choices, and parking policies. Think night pickups, high-value corridors, and urban pinch points.
Device-based tracking: For sensitive shipments, add a breadcrumb, IoT trackers that phone home if a seal breaks or a trailer detours.
Payment monitoring: Set rules that flag payments to newly created vendors or accounts changed this week.
Annual security reviews: Audit your verification process, contracts, and training every year; refresh your playbook as schemes evolve.

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What To Update In Your Contracts

Clear language that prohibits re-brokering without written consent; define “unlawful brokerage” and spell out remedies.
Explicit requirements for driver verification, equipment photos, and geofenced check-ins at pickup and drop.
COI verification requirements (direct with insurer) and minimum limits by commodity.
A right to withhold payment pending investigation if identity or paperwork is suspect.
Data handling and privacy clauses so sensitive information isn’t scattered across freelancers and random portals.

The Bottom Line

Freight fraud is a logistics industry problem, not a single-department issue. If you’re a broker, you’re steering risk on every tender. If you’re a carrier, you’re a target for identity theft and non-payment. If you’re a shipper, your supply chain and financial stability ride on how well your partners verify identities and protect shipments. This isn’t about being paranoid; it’s about being professional.

One last thing. None of this works if leadership treats fraud like an ops headache. It’s a business risk. Train employees; fund the tools; make “verify first” the default. You’ll protect your carriers and your shippers, because you’ll show up as the real broker, the one that pays, the one that ships, the one that protects the load.

Frequently Asked Questions

What’s the single fastest way to cut freight fraud risk this quarter?

Put a hard stop on any banking change, COI swap, or pickup reroute without an out-of-band call-back to a known number on file. One policy change, massive impact.

How do I verify a legitimate carrier without slowing down?

Use a verification workflow: FMCSA/SAFER check, direct insurer call-back, video handshake with the dispatcher, and a quick driver ID match. Do it once, then tier your partners so legitimate carriers move fast on future loads.

What should warehouse staff look for at pickup?

License plate and driver ID must match your file; seal and BOL photos captured in your app; one-time PIN used at handoff; no “my boss said change the address” moves. If something feels off, the shipment does not leave.

Are load boards still safe to use?

Yes, with guardrails. Hide sensitive information up front, screen carriers through your identity tools, and use watchlists to spot re-brokers and fake profiles. Treat open boards as top-of-funnel, not as your verification system.

How do I keep my team from falling victim to BEC and payment fraud?

MFA on email and finance systems; train AP to validate account changes with voice verification to a known number; run monthly reports of “new vendor, new bank” and review them. No screenshots as proof. Only call-backs.

What freight tools or networks should I use or join?

Join the industry networks that share fraud intel and theft alerts; use risk dashboards for route and parking decisions; consider identity-centric platforms for real-time verification. The mix matters less than the habit of checking.

What should my customers hear from me about freight security?

Explain your verification process, your preventative measures, and how you protect sensitive information. It builds trust, and it wins freight.

Written By:

Jeremy Stewart

Turn Returns Into New Revenue

Convert returns into second-chance sales and new customers, right from your store.

Your Seller Fulfilled Prime (SFP) Eligibility Depends On Your Carrier’s OTD Performance

Introduction to Amazon Seller Fulfilled Prime
Enrollment and Eligibility
What Changed in Amazon SFP
The Carrier OTD Problem
Why Sellers Can’t Just “Pick a Better Carrier”
The Imbalance of Risk in SFP
Merchant Fulfilled Network: The Backbone of SFP
Strategies to Survive Carrier OTD Dependence
Bigger Picture: Why This Matters Beyond Amazon
Final Thoughts: The OTD Sword Hanging Over Sellers
Frequently Asked Questions

Amazon has a cruel irony baked into Seller Fulfilled Prime (SFP). You can follow every rule, hit every ship-by deadline, and still lose your Prime badge. Why? Because SFP doesn’t ultimately measure you, it measures whether your carrier delivered on time. And if they don’t, you pay the price.

Amazon fulfillment includes both Fulfillment by Amazon (FBA) and Seller Fulfilled Prime (SFP), with SFP serving as an alternative to using Amazon’s fulfillment centers for order processing and shipping.

To understand how Seller Fulfilled Prime works, it’s important to know that Amazon sellers can choose between FBA and SFP, and third-party Amazon sellers play a key role in both programs. In SFP, sellers ship Prime orders directly from their own warehouse, provided they meet Amazon’s strict criteria for fast and reliable delivery.

Unlike Fulfillment by Amazon (FBA), where Amazon handles the entire fulfillment process, FBA sellers send inventory to Amazon’s fulfillment centers, where Amazon manages storage, picking, packing, and shipping. In SFP, the seller manages the fulfillment process themselves. This means that your performance metrics are directly tied to how well you and your chosen carrier execute each step.

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Introduction to Amazon Seller Fulfilled Prime

Amazon Seller Fulfilled Prime (SFP) empowers third-party sellers to offer Prime shipping benefits directly from their own warehouses, without relying on Amazon’s fulfillment centers. By joining the seller fulfilled prime program, sellers can display the coveted Prime badge on their listings, signaling fast and free shipping to millions of Prime customers. This not only boosts visibility but also helps sellers gain access to Amazon’s loyal customer base and expand their sales channels.

To qualify for Amazon Seller Fulfilled Prime, sellers must meet strict criteria that reflect Prime customers’ expectations, such as rapid shipping, high order accuracy, and exceptional customer satisfaction. SFP sellers are responsible for managing their own fulfillment process, including inventory management and shipping, to ensure every Prime order meets Amazon’s high standards. Sellers who successfully complete the SFP trial period and maintain Prime status can enjoy increased sales, improved customer trust, and a stronger presence in the competitive Amazon marketplace. For many online businesses, Seller Fulfilled Prime offers a unique opportunity to control their fulfillment process while reaping the benefits of the Prime program.

Enrollment and Eligibility

Enrolling in the Seller Fulfilled Prime program requires careful preparation and a commitment to meeting Amazon’s demanding standards. To get started, sellers must have a professional selling account and a default shipping address within the United States. Once these prerequisites are met, sellers can configure their shipping settings in Seller Central to enable Prime shipping and ensure their offers reflect Prime customers’ expectations for speed and reliability.

During the SFP Trial Period, sellers must demonstrate their ability to consistently meet Amazon’s minimum performance requirements, including on-time delivery, valid tracking, and fast shipping speeds. Maintaining a high level of customer service and meeting Prime requirements is essential for keeping Prime status and avoiding removal from the program. Sellers should regularly review their shipping settings and monitor performance metrics to ensure they continue to meet the standards of the Seller Fulfilled Prime Program. By understanding and preparing for these requirements, sellers can position themselves for success and provide an outstanding experience to Prime customers.

What Changed in Amazon SFP

Amazon recently tightened the screws on SFP with updated rules:

93.5% weekly On-Time Delivery Rate (OTD) across all SFP orders
100 minimum shipments per month to even qualify
Strict one- and two-day delivery promises across 48 states
Minimum Product Detail Page Views by product size tier
≤ 0.5% Pre-fulfillment Cancellation Rate tracking Seller-cancelled orders

These rules represent the minimum performance requirements that sellers must meet and maintain to qualify for and retain the Prime badge. Maintaining prime status once eligibility is achieved is essential to ensuring you keep the Prime badge and all the associated benefits for your Prime listings.

If you fall short, even by a sliver, your Prime badge disappears until you claw back up. If you do not meet the requirements, the Prime badge displayed on your Prime listings and Prime items will be removed, significantly impacting your product visibility and sales. It’s no longer about doing “most” things right. It’s about perfection. But here’s the twist: perfection isn’t even in your hands.

The Carrier OTD Problem

Carriers control the final leg of delivery, and Amazon grades you on their performance. SFP sellers must ensure fast shipping speed and nationwide delivery coverage to meet Amazon’s requirements, which adds significant logistical complexity. You can hand off a package on time, scan it into the network, and still get burned if the carrier misses its truck cutoff, misroutes at a sortation center, or has a weather delay.

For sellers, this feels rigged. You’re being measured on someone else’s reliability. And unlike FBA, where Amazon absorbs the risk, (and doesn’t ding itself for late deliveries), SFP makes your business hostage to the carrier’s OTD. Many sellers use Amazon Buy Shipping services to purchase shipping labels, manage shipments, and track deliveries through Amazon’s approved carrier network, but you are still responsible for the final delivery metrics.

Imagine running 1,000 SFP shipments in a month. You hit 100% On-time Shipment. But UPS or FedEx delivers 60 late. That’s a 93.9% OTD, barely scraping the requirement. If they miss 70? You’re at 93.0%. Badge gone. Sales crater.

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Why Sellers Can’t Just “Pick a Better Carrier”

Some might say: use better carriers. But Amazon’s OTD system doesn’t care about nuance. Even the best carriers have bad weeks. Peak season surges, labor strikes, and regional weather, these events sink OTD performance fast.

Carriers are incentivized to protect their own high-volume clients, not your handful of SFP parcels. And regional carriers often can’t cover Amazon’s two-day footprint. To participate in SFP, you must assign your SKUs to a prime shipping template within Seller Central, which enables your products for Prime shipping. That leaves you with UPS, FedEx, or USPS, and each has blind spots Amazon Shipping is rolling out as a 4th option in many regions, but it has its own limitations.

A flexible prime strategy is essential to adapt to carrier performance and ongoing delivery challenges.

The Imbalance of Risk in SFP

Amazon frames SFP as freedom: control your inventory, keep FBA fees at bay, win the Buy Box. SFP also allows sellers to manage their own storage space, potentially reducing overhead costs compared to FBA. But the risk transfer is brutal. You carry the cost of fast shipping and the accountability for late deliveries you didn’t cause. These fast shipping costs can significantly impact your profit margins, making it vital to carefully calculate all expenses to ensure your business remains profitable.

This is why SFP feels unsustainable for many sellers. You’re punished for variables beyond your control, while Amazon shields itself from customer disappointment by pointing to you.

Merchant Fulfilled Network: The Backbone of SFP

The Merchant Fulfilled Network (MFN) serves as the foundation of the Seller Fulfilled Prime program, allowing sellers to fulfill Prime orders directly from their own warehouse while maintaining control over the entire fulfillment process. Through MFN, sellers can leverage Amazon’s shipping services, such as Amazon Buy Shipping, to purchase shipping labels, track shipments, and ensure fast and free shipping for Prime customers. Sellers who want to fulfill orders from channels other than Amazon can consider Amazon Multi-Channel Fulfillment (MCF), which allows the use of Amazon logistics across diverse ecommerce platforms.

Participating in the merchant fulfilled network requires robust inventory management, reliable fulfillment capacity, and a commitment to meeting Amazon’s strict performance standards. Sellers must carefully manage shipping costs, maintain inventory visibility, and ensure their fulfillment process can handle the demands of Prime orders. By optimizing their fulfillment operations and leveraging the flexibility of MFN, sellers can expand their online business, fulfill orders efficiently, and maintain a competitive edge in the Prime program. However, success in SFP depends on the ability to balance fulfillment costs, meet customer expectations, and consistently deliver a Prime-worthy experience.

Strategies to Survive Carrier OTD Dependence

So how do you navigate this trap? There are a few imperfect strategies. First, evaluate different fulfillment options, such as SFP, FBA, and third-party logistics providers, to determine which best optimizes your delivery performance and meets Amazon’s requirements. Having a clear prime strategy is essential for optimizing your participation in Seller Fulfilled Prime, as it allows for continuous adjustments to meet Amazon’s evolving standards.

Spread Volume Across Carriers: Don’t let a single carrier’s bad week wipe out your badge. Split shipments where it makes sense.
Build Weekly Monitoring, Not Monthly: Amazon now enforces OTD weekly. Track performance in real-time, not at the end of the month.
Negotiate Carrier SLAs (Good Luck): Some enterprise-level sellers can hold carriers to OTD service guarantees. But for most, leverage is thin.
Use Third-Party Tools and Networks: Automated routing, peer-to-peer fulfillment, or SFP-optimized 3PLs can spread risk across regions and carriers. Selecting a reliable fulfillment partner is crucial to consistently meet Amazon’s strict delivery standards and maintain Prime eligibility.
Maintain FBA as a Safety Valve: For high-stakes SKUs, keep backup inventory in FBA. Effective inventory management is essential when balancing stock between FBA and SFP to ensure Prime eligibility and avoid stockouts. Planning for seasonal demand is also critical to ensure product availability during peak periods and to optimize storage and shipping costs. Losing Prime visibility can crush sales overnight.

Participating in Seller Fulfilled Prime allows you to create seller fulfilled prime offers, giving you the advantage of maintaining the Prime Badge and offering fast, free shipping while managing your own fulfillment. As an SFP seller, you are responsible for meeting strict performance requirements, but you also gain greater control over your fulfillment process and can benefit from increased competitiveness in the marketplace.

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Bigger Picture: Why This Matters Beyond Amazon

This isn’t just about SFP. It’s a warning shot for ecommerce operators everywhere. As marketplaces push more accountability onto sellers, the margin for error shrinks. These challenges are highly relevant for anyone running an online business, especially third-party Amazon sellers, as fulfillment and logistics are critical to supporting growth and customer satisfaction.

The lesson: logistics performance is becoming a brand asset. Customers don’t see UPS or FedEx on the box. They see you. And if their package is late, they’ll blame you, not the carrier, not Amazon. Effectively managing customer service inquiries is also essential to maintain customer satisfaction and control over the sales process.

In other words: the weakest link in your supply chain isn’t optional. It’s existential. The competitive landscape for ecommerce is becoming more challenging as marketplaces continue to raise performance expectations.

Final Thoughts: The OTD Sword Hanging Over Sellers

Amazon has built SFP into an almost impossible standard. Sellers who want the Prime badge must first complete a Prime trial period, a 30-day window where they must meet strict Prime performance and shipping requirements to qualify for SFP. Even after qualifying, maintaining prime status is an ongoing challenge, as sellers must consistently adhere to Amazon’s high standards and performance metrics to retain the Prime badge. That’s not partnership, it’s risk transfer disguised as opportunity.

So the real question for sellers isn’t: can you hit the SFP metrics? It’s: can your carrier? And if not, what’s your Plan B when Amazon yanks your badge?

Frequently Asked Questions

What is the On-Time Delivery Rate (OTD) for SFP?

Amazon requires a 93.5% weekly OTD for all SFP shipments. Sellers must also maintain a low cancellation rate, specifically less than 0.5%, as high cancellation rates can jeopardize their Prime badge. This means carriers must successfully deliver nearly every package on time for sellers to keep their Prime badge.

How does Amazon calculate OTD for SFP?

Amazon tracks the promised delivery date vs. the carrier’s actual delivery scan. Even if you ship on time, the score reflects the carrier’s performance, not yours.

Can weather or carrier errors still hurt my SFP metrics?

Yes. Amazon doesn’t adjust for weather delays, misrouted packages, or carrier staffing shortages. Sellers are penalized for factors outside their control. Though more recently, Amazon announced that it, in its sole discretion, would exempt late deliveries due to weather conditions where they can verify that weather impacted carrier networks in a region. No Support Ticket necessary. But we’ve yet to see this in practice.

What happens if I miss the SFP OTD requirement?

If your OTD falls below the threshold, Amazon suspends your Prime badge. This usually results in an immediate drop in Buy Box wins and sales volume. Sellers must start over in the SFP Trial if they wish to re-attempt eligibility.

How can sellers protect themselves from OTD failures?

Options include diversifying carriers, tracking OTD performance weekly, using 3PLs with multi-carrier capacity, and keeping FBA inventory as a fallback for critical products.

Sellers should regularly monitor their performance metrics and manage SFP settings within Seller Central. Amazon Seller Central provides the most up-to-date information on SFP requirements and performance. To ensure you meet Prime delivery promises, configure shipping settings in Seller Central according to Amazon’s guidelines. Regularly reviewing and updating your shipping settings is essential to maintain Prime eligibility and optimize delivery performance.

Written By:

Jeremy Stewart

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USPS Harmonized Tariff Code Requirement Starts September 2025

Starting September 1, 2025, every U.S. exporter must include a harmonized tariff code (HTS code) or Schedule B number on USPS international shipments. For years, merchants could get away with vague product descriptions, but now the Harmonized System (HS) is the law of the land. This isn’t just bureaucratic red tape, it’s a restructuring of how international trade data flows through customs, taxes, and shipping.

The System Behind the Codes

At its core, the HS code system is a global classification system governed by the World Customs Organization (WCO). The first six digits are universal across all countries. Beyond that, nations tack on their own rules:

The U.S. uses the Harmonized Tariff Schedule (HTS) for imports.
The Census Bureau oversees Schedule B codes for U.S. exports.

The result? Your ten-digit codes must match precisely, or your traded products get flagged. Misclassification leads to delays, penalties, or worse, lost shipments.

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Why USPS Is Forcing the Issue

Other carriers (FedEx, UPS, DHL) have long required these codes, but USPS gave merchants a free pass. That ends in 2025. Why? Two reasons:

Data accuracy: Governments want to tighten control over tariff rates, duties, and economic statistics.
Trade enforcement: From precious metals to musical instruments, if the right code isn’t on the box, customs will block it.

This shift means even small businesses and Etsy sellers must learn the difference between a “scarf” and “silk scarf” in the eyes of the harmonized system.

How to Classify Products Without Losing Your Mind

Here’s the brutal truth: figuring out the particular product classification isn’t straightforward. For example:

A wooden chair: one code.
A plastic chair: a totally different code.
A musical instrument case: not the same as the instrument itself.

The general rules of interpretation guide classification, but they’re dense. Many merchants rely on customs brokers or US International Trade Commission lookup tools. The Census Bureau’s Schedule B search is another option, but it requires patience.

What Happens if You Get It Wrong

Misclassifying products is expensive. You risk:

Delayed shipments stuck in customs limbo.
Fines and back duties when audits uncover mistakes.
Angry customers when orders don’t arrive.

In a world of instant shipping, one wrong tariff code can tank a brand’s reputation overnight.

The Big Picture: Tariffs as Trade Weapons

This isn’t just about compliance. It’s about global trade politics. Tariffs have become the new sanctions, and the U.S. government wants airtight data to enforce them. When the next round of temporary legislation or retaliatory duties hits, officials will lean on the harmonized tariff schedule to target industries. That means your shipment classification isn’t just paperwork, it’s part of trade policy itself.

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Preparing Now: Practical Steps for Businesses

If you export anything, start now:

Identify codes: Use the Census Bureau or a customs broker to nail down the correct HS code.
Update systems: Make sure your ecommerce platform or shipping software captures the digits long field USPS will require.
Train your team: Teach staff how to spot when a new product needs a new code.
Audit your catalog: Don’t wait until September 2025, clean up your classifications today.

Businesses that get ahead will breeze through customs. Those that don’t will face a pile of returned shipments, taxes, and unhappy buyers.

Frequently Asked Questions

What is the harmonized tariff code?

It’s a global classification system run by the World Customs Organization that standardizes product categories for international trade. The first six digits are universal, but each country adds its own rules.

What’s the difference between HTS codes and Schedule B numbers?

Both come from the same HS system. HTS codes apply to imports, while Schedule B codes apply to U.S. exports and are overseen by the Census Bureau.

How long are HTS codes and Schedule B numbers?

Typically ten digits long in the U.S. The first two digits identify the broad product group, with more digits narrowing down to the particular product.

Do I need a tariff code for every product I export?

Yes. Every traded product must be linked to the right code. Even small differences in material or design may change classification.

What happens if I ship without the correct HTS code?

Your shipment can be delayed, rejected, or fined. Customs agencies use these codes to determine tariff rates, duties, and taxes. USPS will no longer accept vague descriptions without a tariff code starting September 2025.

Written By:

Jeremy Stewart

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Amazon Demand-Side Platform (DSP): The Future of Streaming TV and Digital Ads

I didn’t expect to wake up one day and think, “Wow, Amazon’s DSP is about to rewrite the ad playbook.” But here we are. As part of the broader Amazon Advertising ecosystem, Amazon’s Demand-Side Platform (DSP) is pulling ahead in a big way. Amazon’s Demand-Side Platform offers advanced, data-driven capabilities for targeted advertising, accessible to all advertisers. Amazon DSP stands out in the digital advertising landscape for its integration with Amazon’s data and its unique ability to reach audiences both on and off Amazon platforms.

Snapshot For Busy Brands

Amazon DSP ads aren’t just another channel; they’re a full-stack programmatic hub that lets you buy ad inventory across multiple platforms, including Amazon-owned properties and beyond. Think Prime Video, Fire TV, Amazon owned sites, Amazon owned websites, third party websites, audio, mobile apps, even CTV via Roku, as well as Amazon devices, all with Amazon’s data-rich targeting under the hood.

Amazon DSP offers a variety of ad formats and ad types, such as display, video, and audio ads, to reach customers at different stages of the journey. The platform provides access to premium ad placements and valuable ad space within a digital marketplace, maximizing your campaign’s reach and effectiveness. And ad spend on this thing is exploding.

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Why Amazon’s DSP Is Surging

Let’s talk numbers: Amazon’s Q2 2025 advertising revenue hit $15.7 billion, a 22 percent year-over-year jump, far outpacing its core retail growth. Ad campaigns run through Amazon DSP have significantly contributed to this increase in ad revenue. Executives specifically credited DSP improvements and a new Roku-connected TV deal as major catalysts, noting measurable gains in campaign performance through enhanced targeting and reporting.

Early signs already show advertisers are doubling down. Prime Video ad buys made via DSP rose from 26 percent in Q3 2024 to 36 percent in Q4, and by late 2024, Amazon DSP accounted for 32 percent of all Amazon ad spend. Setting an appropriate marketing budget is crucial for Amazon DSP campaigns, as a minimum spend is often required to fully leverage its capabilities. For advertisers, new to brand sales have become a key metric when evaluating the impact of Prime Video ad buys through Amazon DSP.

Let me put it bluntly: Amazon is turning DSP into its playbook, for video, audio, programmatic display, streaming TV ads, you name it. Amazon DSP campaigns are now central to this shift. It’s cheaper on fees. It leans on unmatched first-party data. And it’s becoming the default for advertisers who want those data-driven, performance-rich hooks.

How Amazon DSP Works, And Where Your Ads Can Show Up

At its core, Amazon DSP is a tool for buying ad inventory through programmatic real-time bidding (RTB), same as other DSPs. This is a form of programmatic advertising that leverages ad exchanges and ad servers to automate and optimize the process of buying and selling digital ads. But it’s the panoramic advantage that matters:

You can target based on Amazon’s shopper behaviors, purchase history, browsing intent, and even the detailed aisles they’ve wandered through. Amazon DSP enables advertisers to reach target audiences, relevant audiences, and existing audiences using advanced ad tech for precise segmentation and campaign optimization.
Your ads appear across Amazon’s ecosystem, Prime Video, product detail pages, Fire TV, mobile browsers, and now across the open web via Amazon Publisher Services and other ad exchanges. This includes Amazon DSP inventory and a variety of ad products such as online video ads, audio ads, and sponsored display ads. Ad placements can be purchased through private marketplace deals and real-time bidding, allowing you to purchase ads and purchase ad inventory efficiently.
The recent Roku integration means you can now reach over 80 million U.S. households using connected TVs via Roku and Fire TV, falling into Amazon’s DSP matrix. Available inventory also includes video content, audio ads, Amazon Music, IMDb TV, and STV ads, expanding your reach across streaming and audio platforms.

You can measure ad effectiveness using metrics like detail page view rate (DPVR), which shows how well your ads drive users to a product detail page or your own website via web browsers. Sponsored display, sponsored display ads, sponsored brands, and sponsored ads are also available within Amazon’s ecosystem, providing additional options for campaign strategy.

Bonus: Amazon’s Multi-Touch Attribution, just deployed, blends A/B tests with machine learning so you can see exactly which ad touchpoint nudged a shopper. That’s next-level measurement. Amazon Marketing Cloud and Amazon’s store provide advanced analytics, reporting, and shopping data to further inform your campaign decisions.

Whether your goal is to sell products or convert shoppers, Amazon DSP leverages purchase intent to help you reach the right ads at the right time. You can choose between managed service, where Amazon or a partner manages your campaigns, or self service, which allows you to control and optimize campaigns independently.

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Good News, Bad News, For Competitors

This isn’t happening in a vacuum. The Trade Desk (a big independent DSP) just took a historic 38 – 40 percent stock dip. Analysts were scared, this isn’t just earnings jitters, this is Amazon eating into CTV ad budgets, margins, and mindshare. Compared to other demand side platforms in the digital advertising space, The Trade Desk stands out for its independence and broad inventory access, but Amazon DSP’s unique integration and data advantages are shifting the landscape.

MoffettNathanson lowered TTD’s stock rating, explicitly citing Amazon DSP’s rise and the way it locks brands into its system, “the Amazon shadow… front and center.”

But, to be fair, Trade Desk hasn’t folded. Advertisers still lean on TTD for cross-channel reach, outside Amazon’s walled gardens. DSP budgets are often additive, not always siphoned off. And deep reporting and independence still matter, even as these shifts reshape the broader digital advertising ecosystem.

What This Means For Ecommerce And Retail Media Teams

Here’s where I make it practical:

Amazon DSP can transform your overall advertising strategy by enabling advanced targeting, measurement, and optimization across a wide range of ad products and inventory sources.

1. If you’re already advertising on Amazon, add DSP now. It’s where off-search, high-intent Amazon audiences live, and you can leverage a variety of ad products to reach and convert shoppers.

2. Want to run streaming TV ads? Amazon DSP with Roku gets you into lean-back moments, impressions that weren’t accessible a year ago. Choose the right ad types, ad formats, and ad placements to optimize your ad campaigns and reach your audience at every stage of the customer journey.

3. Lean on first-party data. DSP is built to use Amazon’s shopper behavior to laser-target people before they search for your next product. Use this data to deliver the right ads to the right audience, target purchase intent, and ultimately sell products more effectively.

4. Measure smarter. Use the new Multi-Touch Attribution to see what actually influenced the conversion, not just clicks. Track campaign performance closely to optimize results and enhance your advertising strategy.

5. Still value open-web reach? Bucket part of your budget away from DSP to independent DSPs like Trade Desk, but be smart about the split and performance layering.

Why This Matters

Amazon’s stacking ad inventory across its own sites, streaming platforms, and broad third-party placements is redefining where marketers spend digital ad dollars. Amazon is consolidating ad space and ad placements across its digital marketplace, streamlining how advertisers access and manage inventory. This shift is also impacting ad revenue for brands and agencies, as the new buying environment changes how returns are measured and optimized. For ecommerce brands, that means controlled shopping-inspired ad journeys. Agencies? It’s a giant shift in media buying workflows, with ad tech integration and a growing variety of ad products now available to support campaign management and targeting.

Whether DSP ends up dominating or just co-dominating, one thing’s clear: if you don’t fit into Amazon’s programmatic picture, you’re invisible to a growing share of the market.

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Final Thoughts

I’ve been watching Amazon’s DSP evolve for years, but this moment feels different. With recent gains in inventory access, better measurement tools, and sky-high ad growth, it’s no longer a fringe play; it’s core infrastructure for streaming TV ads, video, audio, and beyond.

Marketers who tap into DSP now, leveraging Amazon’s reach and data, while still balancing open-web strategies, are the ones reshaping how commerce and advertising converge in 2025.

Frequently Asked Questions

How does Amazon DSP differ from traditional Amazon ads?

Amazon DSP buys ad inventory via programmatic RTB (Real-Time Bidding) across Amazon’s ecosystem, and beyond, using audience data tied to real shopper behaviors.

Can I run streaming TV ads through Amazon DSP?

Yes. With partnerships like Roku and Fire TV, DSP now includes CTV placements across major streaming platforms.

What makes Amazon DSP competitive versus other DSPs?

Its access to first-party shopper data, exclusive inventory, competitive pricing, and enhanced attribution (like Multi-Touch Attribution) give it a performance edge.

Is The Trade Desk sinking because of Amazon DSP?

Trade Desk took a significant hit, analysts flagged Amazon DSP as a key threat. But many advertisers still value Trade Desk’s open-web reach and neutrality.

How should I allocate ad budget between Amazon DSP and independent DSPs?

Lean into DSP for Amazon-owned and streaming inventory, while reserving part of your budget for independent DSPs to maintain open-web presence and measurement balance.

Written By:

Jeremy Stewart

Turn Returns Into New Revenue

Convert returns into second-chance sales and new customers, right from your store.

Amazon DSP Program Success: How to Start and Grow Your Delivery Business

The Appeal of Running Your Own Amazon Delivery Business
Getting Started: Costs, Requirements, and Application Process
What Amazon Provides: Support and Tools for DSP Owners
The Reality Check: Day-to-Day Operations and Challenges
Tips for Success as a DSP Owner
Conclusion: Is the Amazon DSP Path Right for You?
Frequently Asked Questions

The Appeal of Running Your Own Amazon Delivery Business

I remember when I first heard about the Amazon DSP program (Delivery Service Partner program). The idea was instantly intriguing: start your own delivery business, deliver Amazon packages, and get Amazon’s backing in terms of volume and support. For aspiring entrepreneurs, especially those eyeing the logistics industry, it sounded almost too good to be true. You get to tap into Amazon’s vast shipping demand and logistics tools, but still effectively run your own business. No need to build a customer base from scratch; Amazon is your customer, feeding you packages to deliver. Over 4,400 small businesses have already signed up as DSPs since the program launched in 2018, creating 390,000 driving jobs and generating $58 billion in revenue collectively. Those numbers are huge, and they show Amazon’s delivery network isn’t just UPS trucks and USPS mailmen; it’s thousands of independent owners like us driving the blue Prime vans around town.

Amazon continues to disrupt every sector it touches, and last-mile delivery is no exception. By recruiting small business owners to operate delivery fleets, Amazon has quickly built a logistics operation that rivals UPS and FedEx in parcel volume. (In fact, as of 2024, Amazon was delivering roughly 28% of all US parcels, surpassing FedEx and UPS by volume!) They’ve essentially crowdsourced their own private UPS, and as a result, people like you and me have an opportunity to own a delivery business without needing to court customers or create demand. Amazon provides a giant built-in market.

But let’s cut to the chase: What does it actually take to become an Amazon DSP and run a package delivery business? What are the costs, the requirements, the day-to-day realities? Is it true you can start with as little as $10,000 and make a good profit, as Amazon’s marketing suggests? I’ve done the research and even spoken to a few DSP owners. Here’s what I’ve learned about launching and growing a delivery company under the Amazon DSP umbrella.

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Getting Started: Costs, Requirements, and Application Process

One of the biggest draws of Amazon’s Delivery Service Partner program is the relatively low startup costs compared to, say, buying a franchise or starting a logistics company from scratch. Amazon advertises that you can start with as little as $10,000 in initial investment. That number is real, but it’s important to understand what it covers. Essentially, Amazon has negotiated deals on things like van leases, insurance, fuel, and uniforms. By taking advantage of those discounts, your upfront outlay to get, for example, 5 vans on the road can be around $10K. (In contrast, starting an independent delivery biz with 5 vehicles could easily cost several times that once you factor in buying/financing vehicles, etc.)

However, you also need to show you have enough liquid assets to sustain the business as it ramps up. Amazon requires proof of around $30,000 in liquid assets available. This is essentially a financial cushion; you might not spend all that, but Amazon wants to ensure you can pay your drivers and other expenses while cash flow builds. It’s a bit like proving you have some savings to handle the first few months of operation. They’ll do a financial assessment as part of the application.

Speaking of the application, Amazon’s process is quite involved (as it should be, since they’re trusting you with their reputation and packages). Here are the key steps and requirements:

Background and Experience: You’ll need to submit a thorough application, including your work history, education, and any military service. Leadership experience is a big plus; Amazon is looking for people who can coach and motivate a team, handle scheduling, and problem-solve on the fly. Interestingly, logistics experience specifically is not required. Many DSP owners come from totally unrelated fields (banking, hospitality, etc.). But you do need a track record of leading teams or running projects; they want to see that you can manage 40 – 100 employees as your delivery team grows.
Clean Background and Good Credit: There will be background checks and likely credit checks. Since you’ll be hiring drivers who handle packages, any red flags (e.g., serious criminal history) can disqualify you. Financial responsibility is also key because you’ll be handling payroll and expenses.
Initial Screening and Interview: After the online application and assessments, promising candidates are invited to an interview. They want to gauge your understanding of the program and commitment. If selected, you don’t immediately get a delivery territory; you get placed into their pool to match with a delivery station location in need of new DSPs. You can express location preferences, but you may have to be flexible or wait for an opening.
Training: Once accepted, Amazon provides two weeks of hands-on training. This includes a week at Amazon HQ or a regional facility learning the business side, and another week shadowing an existing DSP at a delivery station to learn the ropes. They cover everything from using their route optimization software to managing drivers. Amazon really emphasizes safety and process adherence in this training.
Business Setup: You’ll establish your company (if you haven’t already), get any necessary licenses, and set up things like a commercial driver hiring pipeline, etc. Amazon assists in some of these areas. For example, they have recruiting tools to help you hire drivers and can even refer candidates. They want you to hit the ground running.

It’s worth noting Amazon also had (as of a couple of years ago) a Diversity Grant initiative: a $1 million fund that offered $10,000 for Black, Latinx, and Native American entrepreneurs towards startup costs. This was their effort to reduce barriers for underrepresented business owners. There was a bit of legal controversy around it (some non-minority applicants challenged it), but Amazon was pushing it as part of diversifying the DSP network. If you qualify, it’s something to look into; essentially, it could cover that initial $10K investment for you.

What Amazon Provides: Support and Tools for DSP Owners

Signing on as a DSP, you’re not buying a traditional franchise, but Amazon does act sort of like a franchisor in terms of setting standards and providing a playbook. Here’s what Amazon brings to the table for Delivery Service Partners:

A Steady Volume of Packages: This is arguably the biggest perk. Amazon is your client, and they have more packages than they know what to do with. They’ll assign you routes each day for deliveries in your area. You don’t have to go find customers or drum up business; Amazon is essentially guaranteeing demand. If anything, the challenge is hiring enough drivers to handle all the demand, especially during Peak season (holidays).
Logistics Technology: Amazon equips DSPs with its delivery management tech. This includes the route optimization software (the drivers use an app that maps out their route in the most efficient way, and it’s dynamically updated), scanning devices, GPS trackers in vans, etc. They also give DSP owners access to a central portal that shows all their routes, packages, performance metrics (delivery times, success rates, etc.), basically your business dashboard. It’s a turnkey tech platform many small businesses could never afford to develop on their own. Amazon’s logistics tools are best-in-class, and you get them by default as part of the program.
Deals on Vehicles and Equipment: Instead of you having to buy vans outright, Amazon has negotiated vehicle lease programs. You lease Amazon-branded vans (the blue Prime vans) at favorable rates. Maintenance is included in many cases. They’ve also arranged bulk pricing on things like the handheld devices drivers use, uniforms, insurance, fuel, and even things like route planning software subscriptions if needed. These special rates on start-up equipment, devices, and insurance help reduce ongoing costs.
Training and Ongoing Support: As mentioned, initial training is provided. But it doesn’t stop there. They have account managers or business coaches who will check in on your performance and help you succeed. There’s also a built-in support line, sort of like DSP support, for when issues arise (for example, if a van breaks down or you have routing problems, you have an on-demand support hotline). Amazon provides standardized processes for everything, which is helpful when you’re new. They even give you a DSP Toolkit with guides on HR, recruiting, scheduling, and “best practices” from their highest-performing DSPs.
Payments and Incentives: Amazon pays DSPs per route/stop, etc., based on a contract rate. They also have performance-based incentives. For instance, if you hit certain delivery success metrics or safety milestones, you can earn bonuses or higher payouts. Amazon recently invested an additional $2.1 billion in rate increases and program enhancements to help DSPs with higher wages and vehicle costs. They know that if DSPs aren’t profitable, the whole program fails, so they adjust pay periodically (like a fuel subsidy when gas prices spike, or higher per-package rates in competitive labor markets).

In short, Amazon sets you up with the infrastructure: you have the vans, packages, software, and a playbook. Your job is essentially to hire and manage a team of reliable delivery drivers (called Delivery Associates or DAs) and execute the deliveries efficiently while meeting Amazon’s performance standards.

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The Reality Check: Day-to-Day Operations and Challenges

Running an Amazon DSP business is not an absentee-owner situation. Amazon expects hands-on owners who are deeply involved in day-to-day operations, especially at the start. Many successful DSP owners I’ve spoken with basically lived and breathed the operation in the early months: sorting packages at 6 am, dispatching vans, riding along on routes to learn the ropes, etc. Here’s a taste of the day-to-day and the challenges that come with it:

Early Mornings and Route Planning: A typical day might start before dawn at the delivery station. Amazon staff will have sorted packages for your routes, but you (and maybe a hired dispatcher) will oversee loading. Each morning, you ensure each driver has their truck loaded with the right bags of packages, their device is working, and they understand their route. This can be a hectic phase; if someone calls in sick last minute, you might jump in to deliver or reassign routes on the fly.
Managing Drivers: Expect to hire 40 – 100 delivery associates as you grow (a lot of routes run 7 days a week, so you have multiple shifts). Hiring and retention can be some of the toughest parts. The delivery driver role is physically demanding, with lots of walking, carrying boxes, driving all day, and turnover can be high. Some DSP owners report annual turnover rates north of 100% among drivers, meaning you might be constantly recruiting. One anecdote: a DSP owner mentioned they went through 150 – 200 drivers in a year due to turnover. Keeping drivers motivated and maintaining a good culture is crucial. Amazon monitors things like how fast and safely drivers are delivering, so you need to train and emphasize safety (no running to doors, even if you’re behind schedule, etc.).
Performance Metrics (aka The Scorecard): Amazon tracks your business metrics closely; this is often referred to as your DSP scorecard. Key metrics include your delivery success rate (packages delivered on time without issues), driver safety incidents, complaints, and things like route completion rates. For example, they have targets for on-time delivery rate and valid tracking rate (you must scan every package) that you must meet. Also, keeping a low missed delivery rate and low customer complaints (those “this package was handled poorly” feedback) is important. If your metrics slip, Amazon can issue warnings, require action plans, or, in extreme cases, terminate your DSP contract. So, there’s pressure to perform consistently. It’s not just about finishing the day’s routes; it’s about doing so at a high service level.
Long Hours and Problem Solving: As an owner, you’ll find yourself tackling unexpected problems. A van gets a flat tire. Who goes to help? (Often, you will, or you have a contingency van ready.) A driver can’t deliver a package because of a gated apartment complex. How can you train them for next time? Inclement weather, holiday volume spikes, and tech glitches with the routing app, a DSP owner has to be a chief firefighter of all such issues. During the Peak holiday season, expect to practically live at the station. It’s not uncommon to work 10-12-hour days during busy periods. Many owners do get to a point where they can delegate day-to-day to a station manager they hire, but initially, expect to hustle.
Narrow Margins: Amazon sets the delivery rates, and while they aim to make it profitable, your margins per package can be slim after you pay driver wages, fuel, vehicle leases, insurance, etc. Efficient routing and keeping overtime low are key to making money. Some DSP owners mention that profit can be around $75K – $300K annually once scaled up, but results vary widely. If you’re in an area with higher labor costs or if you run into a lot of vehicle damage, it cuts into profit. Conversely, if you operate super efficiently (low turnover, minimal accidents, high stop count per route), you can do well. But this isn’t a get-rich-quick gig; it’s a medium-sized business with real expenses. (I always tell folks: don’t quit your day job expecting to clear six figures in Year 1; build up your operation first.)
Autonomy vs. Rules: It’s “your” business, but Amazon sets many rules. You have to follow Amazon’s protocols for delivery (from how drivers buckle packages in their vans to how they ring a customer’s doorbell). They also dictate branding, your vans carry Amazon Prime logos, and drivers wear Amazon uniforms. You can implement your own culture and perks for employees, but the overarching guidelines are Amazon’s. Some entrepreneurs chafe at this because you are somewhat limited in making independent decisions (for instance, you can’t decide to deliver for other companies on the side; your contract typically ties you to Amazon packages only). Think of it as being an independent contractor in a very structured system.

All that said, many DSP owners find the work rewarding. A common sentiment: “It’s incredibly challenging, but I love being able to grow something and provide jobs.” For example, a DSP owner named Carlecia (featured on Amazon’s blog) started in 2022 and now employs 120 people across two stations. She talks about the pride of providing livelihoods and giving back to her community through the program. So, there’s a real opportunity to have a positive impact locally while riding on Amazon’s logistics might.

Tips for Success as a DSP Owner

If you’re serious about taking on an Amazon delivery business opportunity, here are some strategies and insights gleaned from those who have done it:

1. Hire Smart, Train Hard: Your drivers are your business. Prioritize hiring people who are reliable and customer-friendly. Use Amazon’s recruiting support, but also get creative, tap local job fairs, refer-a-friend bonuses for your current drivers, etc. Once hired, train them thoroughly on the routes, the scanner device, and Amazon’s expectations (like on-time delivery standards and safety reminders such as not backing up unnecessarily, wearing seatbelts, dog bite prevention, etc.). Well-trained drivers will be more efficient and make fewer mistakes (which keeps your Amazon scorecard healthy).

2. Create a Positive Team Culture: Delivery work is tough. Little things can keep morale up, providing water and snacks for drivers, recognizing top performers, and celebrating hitting milestones (like 100% delivery day or safety streaks). Some DSPs do morning huddles with a quick motivational talk or shout-outs. If you treat drivers as valued team members rather than package-hauling machines, you’ll reduce turnover. Also, be open to their feedback; the folks on the road often have ideas to improve routing or efficiency.

3. Keep an Eye on Efficiency Metrics: Use Amazon’s provided dashboards to monitor your performance goals daily. Watch your route completion times, package consolidation (are vans leaving with under-loaded capacity?), and any “failed delivery” reasons. By analyzing this data, you can spot trends, for example, if one route or driver consistently runs behind, maybe the route is too large or there’s a traffic issue you can reroute around. Small tweaks can save you overtime costs and improve your stops per hour. Amazon loves efficiency, and higher productivity can sometimes lead to Amazon offering you more routes (more routes = more revenue).

4. Safety First (It Pays Off): Amazon is pretty strict about safety, for good reason. Accidents or injuries are bad for everyone. Enforce the safety training points: drivers should take breaks, avoid rushing, and follow all protocols (like using a delivery cart for heavy packages, dog awareness, etc.). Not only will this avoid the nightmare of someone getting hurt, but Amazon’s incentives often reward safe operations. For instance, keeping a low accident rate and high compliance might qualify you for quarterly bonuses or better route assignments. Some DSPs even incorporate a daily quick safety tip in their morning meet-ups to keep it top of mind.

5. Plan for Peak Season Early: The November-December surge (and to a lesser extent, Prime Day or other big sales) will push your operation to its limits. Plan ahead, start recruiting seasonal drivers by late summer, secure extra vans if possible, and maybe have administrative staff or yourself ready to jump in on delivery routes when volume peaks. It’s common for DSP owners to deliver packages themselves during Peak to handle overflow. If you plan well and communicate expectations to your team (yes, there will be long days, yes, everyone works most days in December), you can get through it and even enjoy the challenge. Amazon often pays extra incentives during Peak due to the intensity, so a well-run Peak can significantly boost your annual profit.

6. Network with Other DSPs: Amazon hosts an online forum and occasional meet-ups for DSP owners. Use these to your advantage. Other DSPs aren’t your direct competitors (they operate in their own territories), and they can be gold mines for advice. They’ll share tips on everything from which route optimization tricks work best to how to handle a driver who consistently calls out. I’ve seen DSP owners help each other by loaning vans in a pinch or covering routes if one had a crisis. Being part of the community also keeps you in the loop if Amazon updates policies or makes changes to the program.

Running an Amazon DSP can definitely become a thriving small business if managed well. Amazon’s VP of delivery operations often says they want DSP owners who are “obsessed with customer experience and their people.” That seems to ring true: focus on reliably getting packages to customers on time (making Amazon look good) and focus on keeping your employees happy. That formula, backed by Amazon’s demand and resources, is a path to success in the program.

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Conclusion: Is the Amazon DSP Path Right for You?

The Amazon delivery service partner program is an innovative model: Amazon leverages local entrepreneurs to expand its delivery reach, and those entrepreneurs get a shot at business ownership in a booming sector. It’s not a guaranteed money-printing machine (anyone who thinks they’ll just hire a manager and sit back should think again). It requires hustle, resilience, and adaptability. You’re dealing with humans (drivers, customers) and a tech giant’s systems, both can be unpredictable at times! But if you put in the effort, you can build a solid operation with stable revenue.

To sum it up, the DSP program offers a relatively accessible way to own a delivery business for those who have leadership chops and a willingness to work within Amazon’s framework. You don’t need to be a logistics expert or come with a fleet of trucks; Amazon provides the playbook and the packages. Your job is to execute with excellence. Many small business owners have used this program to become employers in their community, create hundreds of jobs, and yes, make a good living in the process. They’ve shown that with grit and smart management, you can successfully run an Amazon delivery business.

Like any business, there are risks: thin margins, high turnover, and the fact that Amazon can change the rules or pricing (their recent changes to the contract rates and the end of the de minimis shipping exemption show the environment can shift). However, Amazon has a vested interest in DSPs succeeding; they need you to deliver their packages. As Amazon keeps growing its ecommerce dominance, the volume of packages isn’t slowing down; if anything, there’s more demand for delivery routes every year. That bodes well for DSPs who run efficient operations.

In the end, whether the DSP program is right for you comes down to your personal goals and management style. If you enjoy hands-on operations, don’t mind rolling up your sleeves (or driving the occasional van yourself), and get satisfaction from meeting targets and growing a team, it could be a great fit. It’s a chance to ride on Amazon’s growth while still being your own boss day-to-day. Just go in with eyes open, realistic expectations, and a strong work ethic. Starting a delivery business through Amazon isn’t easy money, but for many, it’s proving to be good money and a pretty exciting ride in the process.

Frequently Asked Questions

How do I become an Amazon Delivery Service Partner?

Apply through the Amazon DSP program site, show $30K in liquid assets, pass background checks, complete training, and launch with Amazon-provided routes and vans.

How much does it cost to start a DSP business?

Startup costs begin at around $10K with Amazon-negotiated discounts. You’ll also need $30K in liquid assets to cover wages, fuel, and early operating expenses.

Can I make a profit as a DSP owner?

Yes. Profits for scaled DSPs typically range from $75K to $300K annually, depending on fleet size, route efficiency, and meeting Amazon’s performance metrics.

What’s the difference between Amazon DSP and Flex?

DSP is running a delivery business with employees and Amazon vans. Flex is gig work, where drivers use their own cars for smaller deliveries and work as independent contractors.

What support does Amazon provide DSP owners?

Amazon offers training, coaching, routing software, performance dashboards, discounts on vans and insurance, guaranteed package volume, and 24/7 operational support.

Written By:

Jeremy Stewart

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How To Find A Freight Forwarder: Importing Into The U.S. 101

Tip 1. Verify Licenses And Bonds Before You Compare Rates
Tip 2. Ask Who Files Your ISF 10+2 And When
Tip 3. Choose Incoterms That Match Your Risk Tolerance
Tip 4. Ask About CTPAT And Trusted Trader Programs
Tip 5. Demand Mode And Lane Options Up Front
Tip 6. Plan The Handoff To Your 3PL Before The Ship Sails
What A Great Forwarder Looks Like
Common Pitfalls That Kill Margin
The Cahoot Angle
Frequently Asked Questions

You can absolutely import inventory into the U.S. without losing sleep or margin. Freight forwarding companies play a key role in facilitating the import process for businesses of all sizes. The trick is picking a freight forwarder who treats compliance like oxygen and hands your cargo cleanly to your fulfillment partner. Here is the practical playbook I use with sellers who are new to international shipments.

Tip 1. Verify Licenses And Bonds Before You Compare Rates

Ocean forwarders and NVOCCs (Non-Vessel Operating Common Carrier) that move your containers must be properly licensed by the Federal Maritime Commission. You can verify an Ocean Transportation Intermediary’s license status in the FMC’s public database, and you can confirm their bond. When reviewing a forwarder, make sure to check all paperwork, including permits and insurance, to ensure full compliance. For example, a hazardous materials permit may be required if your cargo includes dangerous goods. If your forwarder cannot provide a license number, the necessary permits, or shows up as non-compliant, walk away.

Air forwarders should have an IATA number and TSA compliance as an indirect air carrier. Trade associations like NCBFAA (National Customs Brokers & Forwarders Association of America) outline the basics. Additionally, air forwarders should hold any required permits for handling specific cargo types, such as perishable or restricted items. The point is simple. Compliance first, quotes second.

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Tip 2. Ask Who Files Your ISF 10+2 And When

For ocean freight, U.S. Customs requires an Importer Security Filing 24 hours before the cargo is laden at the foreign port. The ISF filing process involves several steps, including gathering shipment details, submitting accurate information, and confirming receipt by Customs; following each step carefully is crucial to avoid penalties. Late or missing filings can trigger holds, inspections, and monetary penalties. Your forwarder or customs broker should own the data flow and the deadline, not your intern. Put it in writing. Clear communication between the importer and the forwarder is essential to ensure all deadlines are met and responsibilities are understood.

Tip 3. Choose Incoterms That Match Your Risk Tolerance

Incoterms define who pays for what and when risk transfers. If you pick DDP, the seller handles import clearance and duties. If you pick DAP, you, the buyer, handle import clearance. Pick wrong and you inherit surprise costs at the final destination. The ICC and reputable logistics providers publish clear differences between DDP and DAP. Read them, then decide.

Understanding how Incoterms affect the shipping process is crucial for importers, as these terms determine responsibilities and costs at each stage. A freight forwarder’s ability to advise on and manage various Incoterms can help importers avoid unexpected costs and ensure a smooth shipping process.

Tip 4. Ask About CTPAT And Trusted Trader Programs

CTPAT-validated partners (Customs-Trade Partnership Against Terrorism) can see reduced CBP (Customs and Border Protection) examinations and faster processing. Participation in CTPAT is a critical factor for importers in industries with high compliance requirements, as it can significantly impact shipping efficiency and reduce overall costs. Certain industry sectors, such as pharmaceuticals and electronics, benefit more from trusted trader programs due to the sensitive nature of their goods. The Trade Compliance program is voluntary, but for high-velocity importers, the benefits are real. If your forwarder participates or can align with your importer status, you can shave days of unpredictability off lead times.

Tip 5. Demand Mode And Lane Options Up Front

Do not let a forwarder sell you a single route. For many SKUs, the right forwarder offers a full range of logistics solutions, including ocean freight for base flow and air freight for exceptions, with clear guidance on when to switch. Access to trucks is essential for domestic transportation, ensuring goods move efficiently from warehouses to final destinations. A reliable forwarder will arrange all aspects of the shipment, including scheduling trucks and coordinating with carriers. You want at least two carriers per lane, transit time options, and visibility tools that show where the container is, not just when it left. Forwarders offering integrated logistics solutions can provide more flexibility and efficiency. Reputable guides from carriers and platforms explain how forwarders aggregate volumes to get better routes and rates.

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Tip 6. Plan The Handoff To Your 3PL Before The Ship Sails

Your forwarder is not your 3PL. Make sure the arrival notice, customs clearance status, and delivery orders are shared with your fulfillment partner early. That includes documentation, lading details, and any hazardous materials or perishable goods flags. Coordinate with your suppliers to ensure all necessary information and documentation are provided for a smooth handoff. Proper packaging is essential to ensure goods arrive safely and meet fulfillment requirements. If your fulfillment partner requires appointments at their distribution centers, your forwarder should book trucking in time to meet your launch date. Warehouses play a crucial role in ensuring efficient inventory management and smooth coordination between shipping parties. This is where Cahoot’s partner list helps. We match import lanes with the right last mile and warehousing so your inventory hits the shelf quickly.

What A Great Forwarder Looks Like

Licensed and insured with transparent bonds and a clean FMC entry.
Strong customs brokerage, either in-house or via a close partner.
Clear SOP for ISF and entry filing with named owners and backups.
Incoterms coaching before you sign the PO with your supplier.
Multiple modes and carrier options with time-definite transparency.
Comprehensive service and solutions, including excellent customer service, responsive communication, and value-added offerings to ensure smooth shipping operations.
Expertise in specific industries or routes, ensuring the forwarder understands your market, regulatory requirements, and can navigate local nuances effectively.
Proven handling capabilities for various types of cargo, including hazardous materials and perishable goods, to guarantee compliance and safety throughout the logistics process.
Ability to provide all the services required for your supply chain, such as multimodal transportation, warehousing, and integrated logistics solutions, so there are no gaps in coverage.
Selecting the right freight forwarder means choosing a partner who meets all these criteria and can fully support your shipping needs.

Common Pitfalls That Kill Margin

“DDP included” without a real broker. You pay twice when surprise duties appear on arrival.
Late ISF filings. Your cargo sits. You pay storage. Your launch slips. CBP is unsentimental about deadlines.
No appointment at the final destination. The forwarder blames the warehouse. Warehouse blames forwarder. Customers do not care.
Choosing based on price only. The cheapest quote often hides documentation, delivery, or demurrage risk you will learn about later. Trying to save money upfront can actually cost your business more in the long run if important factors like reliability, customer service, and specialty needs are ignored.

Selecting the right freight forwarder is an important factor for business success. A good forwarder can help streamline your shipping process, reduce risks, and ensure your money is managed properly, supporting your business growth and efficiency.

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The Cahoot Angle

Cahoot does not pretend to be your forwarder. We partner with licensed, audited forwarders and customs brokers, then make the U.S. handoff painless. Our fulfillment network receives, checks, and slots your goods into the right nodes so you can start selling faster. From the ocean vessel to the customer’s doorstep, the supply chain only works if every handoff is clean. Contact Cahoot to learn how you can save shipping time and money, even if you don’t require order fulfillment services.

Freight forwarding companies play a crucial role in the global market by helping businesses, exporters, and shippers manage complex international shipping logistics. In a country like China, which is the world’s largest exporter, the freight forwarding market is highly developed, and exporters rely on intermediaries to navigate regulations and ensure goods are delivered efficiently. Companies such as UPS and DHL operate ships and provide international shipping services, supporting the movement of goods across borders. Maintaining regular contact with your forwarder is essential to confirm shipments are delivered on time and users receive a positive experience. Businesses should search for a company with a proven track record in managing shipments and providing reliable delivery to stay competitive in the international shipping market.

Frequently Asked Questions

Do I Need A Freight Forwarder Or Just A Customs Broker?

Most importers use both. The forwarder manages transportation door to door and offers a range of services—such as warehousing, customs clearance, and logistics solutions to meet different shipping needs. The customs broker files entries with CBP and coordinates PGA requirements. Many firms provide both. Verify roles in your contract.

What Happens If My ISF Is Late?

CBP can assess penalties, increase inspections, or delay release. Your container may sit while fees accrue. Assign ISF responsibility to your forwarder or broker in writing and audit the workflow.

Should I Choose DDP Or DAP?

If you want control and transparency on duties and taxes, DAP is safer. If you want simplicity and are willing to pay a premium, DDP shifts import clearance to the seller. Align the choice with your compliance capability.

How Do I Check If A Forwarder Is Legitimate?

Use the Federal Maritime Commission’s OTI (Ocean Transportation Intermediaries) and NVOCC (Non-Vessel Operating Common Carrier) databases to confirm license and bond status. Ask for proof of insurance and recent reference letters.

Can A Forwarder Reduce My Lead Time?

Yes. CTPAT-aligned partners and multi-carrier routing often reduce holds and improve reliability. The right forwarder is a logistics provider that designs options, not a single price.

Written By:

Jeremy Stewart

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What Is Order Fulfillment Software, And When Do You Actually Need It

Plain English Definition

Order fulfillment software connects sales channels to your logistics operations. It automates the entire fulfillment process from order ingest to warehouse allocation, picking, packing, label creation, and tracking. Order management and order processing are central to the order fulfillment process, ensuring that each step, from receiving a sales order to preparing and shipping the product, is handled efficiently and accurately. Think of it as the brain that routes customer orders to the right fulfillment center and shipping service so you hit delivery times without overspending.

Where people get confused is in the alphabet soup. An OMS manages orders across channels. A WMS runs the inside of a building. Fulfillment software sits in the middle. It knows your inventory levels and shipping preferences, manages sales orders, and streamlines fulfillment operations and processing by deciding which warehouse should fulfill, calling the carrier APIs to print shipping labels, and pushing real-time updates back to your ecommerce platform.

What Good Fulfillment Software Actually Does

Centralizes orders from all sales channels into a single dashboard with real-time data, low stock alerts, and robust inventory management features. Easily track inventory and monitor stock levels across multiple channels and warehouses.
Allocates to the best node using rules about delivery times, shipping costs, inventory, and service level.
Automates labels and documents, including packing slips and customs forms.
Tracks orders in real time at every stage of the fulfillment process and updates customers automatically through your preferred channels.
Surfaces exceptions for manual review only where needed, so manual data entry disappears.
Drives efficiencies by automating and optimizing fulfillment operations, streamlining processes, and maximizing supply chain performance.

When You Truly Need It

You can hustle with one warehouse and one channel. But you actually need a fulfillment solution when any of these tripwires hit.

Multiple warehouses or strategically located fulfillment centers.
Two or more major sales channels.
Delivery speed promises that vary by zone.
Volume spikes around major sales events that break manual processes.
Frequent out-of-stocks that require backorder logic and transparent ETAs.
Handling a high volume of online orders from multiple online retailers.

If two or more are true, stop winging it. The cost of mis-picks, shipping with the wrong carrier, or missing two-day delivery speeds is bigger than the software subscription. Efficient fulfillment operations and a well-integrated supply chain are essential for maintaining customer loyalty as your business grows.

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The OMS Versus WMS Question You Will Ask

You will ask whether you need an OMS, a WMS, or both. The short answer. OMS orchestrates orders across channels and locations. A WMS runs the inside of a building, handling warehouse management such as inventory control, order processing, and warehouse operations. Many brands run both, with fulfillment software tying them together and talking to carriers. An order fulfillment solution streamlines order processing between OMS and WMS, ensuring efficient and accurate handling of customer orders.

Features That Move The Needle

Smart routing and rate shopping to reduce shipping costs while meeting delivery expectations.
Real-time inventory sync and low stock alerts to protect customer trust and avoid overselling.
Voice picking support to boost pick speed and accuracy up to material levels when paired with a capable WMS.
Native shipment tracking for real-time shipment tracking and updates after products are shipped.
Efficiently ship products with confirmation and status updates when orders are shipped, ensuring transparency and timely delivery.
Audit trails across order details, allocation decisions, and exceptions for informed decisions later.

A Starter Architecture For Small Business To Mid-Market

Sales channels. Major ecommerce platforms and marketplaces. This architecture is ideal for small businesses looking for scalable and affordable solutions.
Fulfillment brain. Your order fulfillment software with rules for shipping operations, carrier selection, and SLA guardrails. The software manages sales orders, tracks them through the fulfillment process, and automates the creation of packing slips for each sales order, streamlining order processing and improving accuracy.

Nodes. One to three fulfillment centers to start.
Data flow. Single dashboard for real-time insights, full control of shipping labels, and simple returns routing. The system provides visibility into all sales orders, from processing to delivery, helping small businesses monitor and manage orders efficiently.

Cahoot helps small businesses through enterprise clients manage sales orders efficiently and automate packing slip generation. The point is not the brand. It is the design. Choose software that exposes events, automates the label pipeline, and scales to new sales channels without custom projects.

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The Cahoot View

Cahoot’s software was built to cut shipping costs by routing orders to the closest, best node across our fulfillment partners. This approach drives efficiencies and streamlines fulfillment operations for ecommerce businesses by optimizing order routing, inventory management, and shipping processes. You get one login, a single dashboard, and real-time updates. When your ecommerce business adds multiple warehouses or new sales channels, you do not rewire your store. You flip a switch.

Frequently Asked Questions

How Is Fulfillment Software Different From OMS And WMS?

OMS manages the order lifecycle across channels. WMS manages the warehouse floor. Fulfillment software sits between them to allocate orders and create labels while feeding tracking back to customers.

Will It Actually Reduce Shipping Costs?

Yes, if it routes the order to the closest node and rate shops carriers automatically. Software that cannot rate shop or apply shipping preferences consistently will not move the needle.

Do I Need This With Only One Warehouse?

Not always. But once your business starts to scale, for example, you add more sales channels, add a second node, or promise faster delivery times, manual allocation becomes error-prone and expensive.

How Does Voice Picking Fit?

Voice picking lives inside the WMS. Your fulfillment software should pass clean pick lists to a WMS that supports voice so you gain speed and accuracy benefits.

What Integrations Matter Most?

Direct connections to your ecommerce platform, carriers for labels, and a tracking layer like Cahoot for real-time updates. Without these, your “automation” still depends on manual data entry.

Written By:

Rinaldi Juwono

Rinaldi Juwono leads content and SEO strategy at Cahoot, crafting data-driven insights that help ecommerce brands navigate logistics challenges. He works closely with the product, sales, and operations teams to translate Cahoot’s innovations into actionable strategies merchants can use to grow smarter and leaner.

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Best 3PL For Startups: Horror Stories From Small Brands And How To Avoid Them

Why Startups Struggle With 3PLs

First, the market keeps shifting under your feet. Shopify exited its owned fulfillment bet and sold logis…which can trap small businesses in plans that no longer fit.

Second, carriers keep tinkering with fees. UPS, FedEx and USPS have confirmed 2025 holiday demand surcharges and USPS seasonal hikes. If your 3PL does not proactively mitigate these surcharges with smarter routing and regional carriers, your shipping costs will eat into customer satisfaction and margin. Outsourcing logistics to a 3PL can help startups reduce overhead costs and achieve operational efficiencies by leveraging third-party expertise and technology.

Third, small warehouses are scarce relative to giant buildings. Finding a six to twenty-thousand-square-foot site near your customers is harder than it looks, which is why multiple fulfillment centers inside a partner’s network matter for timely delivery at startup scale. Outsourcing logistics can also lead to significant labor savings by reducing the need for in-house staff to manage logistics needs, allowing startups to focus on growth.

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Real World “Horror Stories” You Can Learn From

A founder signs a slick proposal and discovers a monthly minimum that jumps two quarters later. We just watched a major provider announce a $5,000 monthly minimum starting in 2026. If you are a startup, that can be a deal breaker. Make minimums and their review dates explicit in the MSA (Master Services Agreement). Also, ensure the provider has a proven track record working with startups.
Another brand chooses a one-size-fits-all provider optimized for low SKU, high volume. Complexity spikes, errors soar, and support becomes a ticket loop. Even 3PL owners warn publicly that some large providers fit only specific profiles. Validate with reference calls from merchants like you. It’s crucial to select the right fulfillment service and a reliable fulfillment partner who can support your business as it grows.

The Startup 3PL Checklist I Use

1. Fit To Sales Channels And Customer Expectations

Does the provider natively support your sales channels today? Amazon, Walmart, TikTok Shop, Shopify, wholesale EDI. If they plan to “add it later,” assume you will be the beta tester. Fast and free is not enough. Consistency and reliable delivery matter more for improved customer satisfaction and repeat sales. The right 3PL can improve the overall customer experience by tailoring order fulfillment to customer preferences and enhancing customer satisfaction.

2. Transparent Pricing With Caps On Peak Fees

Ask for a single page that shows storage fees, pick and pack, packaging materials, account management fees, and any peak season surcharges passed through. Cross-check with public carrier announcements to see if the line items make sense. Avoid hidden fees by insisting on an all-in, effective rate card for your realistic order volume. Competitive pricing is also crucial for startups, as it ensures you receive cost-effective solutions that support your business growth and help establish long-term partnerships.

3. Multiple Fulfillment Centers And Real-Time Routing

Startups need timely delivery without air. A 3PL with multiple fulfillment centers and regional carriers can cut shipping costs and delivery times. Distribution centers and reliable shipping are essential for an efficient delivery process, ensuring that orders are fulfilled quickly and consistently to meet customer expectations. Distribution services and fulfillment centers play a crucial role in supporting startups’ logistics needs by managing inventory, coordinating shipments, and streamlining the overall delivery process. Ask for a shipping simulation across your last twelve months of orders. If they cannot run it, they are guessing.

4. Inventory Management System That You Actually See

You need real-time tracking, low stock alerts, and simple inventory management, not a black box. If the portal cannot show inventory accuracy by location and order processing exceptions in one dashboard, your day-to-day operations will slow down.

Efficient inventory storage and managing inventory are essential for startups to streamline fulfillment and reduce costs. Leveraging technology and robust warehousing and inventory management practices helps maintain optimal inventory levels, preventing excess stock and minimizing storage expenses. For example, the Cahoot Network enables inventory distribution across multiple warehouses, making it easier for ecommerce businesses to reach more customers and reduce shipping costs. By focusing on optimal inventory levels, you can ensure your inventory management system supports both cost efficiency and fast order fulfillment.

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5. Dedicated Customer Support With Escalation Paths

Startups underestimate the value of a named human who resolves issues. Excellent customer service, provided by key personnel with logistics expertise, is essential for startups to receive responsive support and effective problem-solving as they grow. Make the contract list the escalation chain and response SLAs. Ask for a sample “warehouse exception” report and how it is handled inside their logistics operations.

6. Returns, Kitting, And Value-Added Services

Your business growth can stall if your 3PL cannot handle light assembly, kitting, or returns at scale. Robust fulfillment operations and effective fulfillment strategies are essential for startups to remain competitive and meet customer expectations. Many ecommerce startups discover too late that their “best fulfillment service” will not relabel or bundle without lead time. Fulfillment services for startups can provide customized solutions to support business operations, ensuring flexibility and scalability as you grow. Confirm support for seasonality and value-added services in writing. Startup fulfillment and ecommerce fulfillment should be key considerations for growing brands seeking to optimize logistics and enhance customer satisfaction.

The Cahoot Fit For Startups

Cahoot was built for ecommerce startups that need cost savings without losing control. As a 3PL provider, Cahoot delivers comprehensive logistics services tailored for startups. As a fulfillment company, Cahoot supports business operations by streamlining order fulfillment, warehousing, and inventory management, resulting in significant labor savings and operational efficiencies.

Cahoot enables startups to expand into international markets by providing reliable international shipping solutions that simplify global logistics and ensure timely delivery. By offering expert supply chain management, Cahoot allows you to focus on your core business activities while improving supply chain efficiency and customer satisfaction.

Multi-node coverage for reliable delivery, clear pricing to avoid hidden fees, and a fulfillment process you can see. We are opinionated about inventory management and day one integrations, so you can scale operations across sales channels without a significant capital investment up front.

Frequently Asked Questions

What Is The Number One Mistake Startups Make With 3PLs?

Choosing based on price alone. Selecting the right fulfillment solution and fulfillment company is crucial to ensure your logistics needs are met as your business grows. The cheapest proposal usually hides storage costs, minimums, or limited carrier options that inflate your shipping costs later. Verify the total cost of ownership against your order volume, and consider cost-effective packaging strategies to further optimize your fulfillment process.

Do I Need Multiple Fulfillment Centers From Day One?

Not always. But you should pick a partner with the ability to add nodes as your ecommerce business grows. Having access to multiple distribution centers and fulfillment centers can improve inventory storage and scalability, allowing for more efficient order processing and faster shipping as your business expands. A two-node network often cuts zone-based costs dramatically compared with one node.

How Do Peak Season Surcharges Affect Startups?

Seasonal “demand” fees can swing your unit economics. Efficient order fulfillment and a streamlined delivery process are essential for reliable shipping during peak seasons, helping to manage surges in demand and maintain customer satisfaction. Confirm how your 3PL mitigates or passes through FedEx, UPS, and USPS surcharges and how that impacts timely delivery.

What Proof Should I Ask for From A 3PL Before Signing?

We recommend at least 2 customer references that match your SKU count and seasonality, a shipping simulation, and a demo of their inventory management system. If any are missing, wait. It’s also crucial to choose a provider with a proven track record in the industry to ensure reliability and expertise.

Written By:

Jeremy Stewart

Turn Returns Into New Revenue

Convert returns into second-chance sales and new customers, right from your store.

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