FreshingStock Startup Handles US Returns For Chinese Merchants

Warehouse Space Running Out is a startup that handles U.S. returns for Chinese online merchants.

More and more Chinese merchants are selling to U.S. consumers via online marketplaces, but there’s a language barrier during these transactions.

Enter, a startup that handles returns for Chinese sellers selling in the U.S. on marketplaces like Amazon and eBay. The company said it will handle about 1 million packages this year, nine times the amount it processed last year.

And much of this activity is being fueled by Chinese merchants, who Amazon has said doubled global sales on its marketplace in 2015.

“Before, we had to ship those returned products back to China,” Patrick Zhang, founder and CEO of electronics retailer Shenzhen StarMerx Technology Ltd., told Internet Retailer. “Besides the shipping costs, we also had to cover the duty tax for shipping goods into China. For low-value returned products, like small accessories, the only thing we could do was to discard them, even though we know 70 percent of them were returned only because of customer misuse or buyer’s remorse.”

Forrest Guo, founder and CEO of FreshingStock, said that about 70 percent of Chinese merchants who sell their goods on Amazon use Fulfillment by Amazon, which means the giant eTailer warehouses the goods for Chinese merchants and arranges delivery. But oftentimes, Amazon will return goods sent to its warehouses for reasons like products not matching the description, lacking labels or they were delivered to the wrong warehouse, which is where communication issues can arise with the merchants back in China who might not understand the reason for the return.

“Our business is to help global merchants on Amazon solve those issues. Ninety percent of our clients are Chinese merchants,” Guo told Internet Retailer. “Most of our clients are middle to small-size merchants that don’t have a facility in U.S. But we do have large clients because we can process return in a more efficient way. Our warehouse and computer systems are designed for returns, so we can examine and even repair returned goods quickly.”

FreshingStock operates a 110,000-square foot warehouse in the Pittsburgh area with 20 employees to handle U.S. returns.



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