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Subject: Kickstarter fulfillment via China? rss

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Kim Brebach
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Looking at pushing solutions for solving the problem of really high international fulfillment costs from the US to international. i wont go into that argument here - its been done to death. Apologies if this really isnt the best forum for this discussion, happy for it to be moved elsewhere.

So... Does any one here know anything about or had experience of running fulfillment for KS games direct from China?

KS games are often prohibitively expensive for international backers.
heres a sample regional breakdown for Viticulture (thanks Jamey)

22 backers in Asia who are receiving at least one copy of the game (2.4%), 23 backers in Oceania (2.5%), 682 in the US (75.7%), 51 in Canada (5.6%), 114 in Europe (12.6%), and 8 in Brazil (1%).

So 25% international backers.

The typical model is that 1000 - 3000 games are made in china, shipped to US by slowboat to both fulfillment company and distributors. then sent to backers internally (reasonably cheaply) and internationally (usually at some great expense). I'm confident that expense reduces the total volume of international backing for KS games.

So I know PandaGM are in Shenzen (near HK) as are a few fulfillment companies.

So im wondering how feasible it is for;
1. all fulfillment to be done by a chinese fulfillment company with good QA
2. Some fulfillment eg just those outside US , to be done a chinese fulfillment company resulting in lower international backing costs (reduced shipping costs and reduced international postage)

Shipments to distributors would still need to go out as usual I guess.

Thoughts?

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Damien Cosgrove
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All I know is that I've backed 1/2 the KS campaigns I would have if the international shipping wasn't so large.
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jumbit
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They tried that with Glory to Rome. It didn't work out so well for them.
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Sturv Tafvherd
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It's a good idea.

I think the problem is in execution: is there a trustworthy small-package delivery company operating out of China?
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Adam Trzonkowski
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I think the idea is sound but as others have suggested you'd have to know for sure that you can trust the company to make deliveries.

I've certainly had trouble shipping to the pacific region in the past. Usually I meet the backer halfway and eat some of the cost just to get it into their hand.

I would be extremely interested in hearing how this works out for you.
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Tony Pullen
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feign wrote:
All I know is that I've backed 1/2 the KS campaigns I would have if the international shipping wasn't so large.


+1 to that comment.
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Jools Thomas
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I have been wondering the same thing myself. What if the founder of the project himself were to oversee the project personally or actually fulfill the orders manually whilst in China?

Also, is it true that this was already tried with GTR? The linked to thread didn't really reveal what was going on.
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Sturv Tafvherd
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Jools wrote:
I have been wondering the same thing myself. What if the founder of the project himself were to oversee the project personally or actually fulfill the orders manually whilst in China?
.


I don't think the main problem is the project manager in this case. The project manager would still need a delivery service that has operations in China.

It has been a year since this article. Anyone know?
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Kim Brebach
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Stormtower wrote:
It's a good idea.

I think the problem is in execution: is there a trustworthy small-package delivery company operating out of China?


Stormtower wrote:
Jools wrote:
I have been wondering the same thing myself. What if the founder of the project himself were to oversee the project personally or actually fulfill the orders manually whilst in China?
.


I don't think the main problem is the project manager in this case. The project manager would still need a delivery service that has operations in China.

It has been a year since this article. Anyone know?


Yeah I agree - good reputation, reviews, and proper QA would be essential for feeling safe about using a chinese fulfillment service, as with any other. Once such a business was found I imagine they would see a bunch of KS business if the model is viable and the risks negligible.

That article about the rise of myriad cheap express delivery in china looks interesting but I think its talking mostly about domestic deliveries, although I guess its probably applicable to international services too.

I'm not really sure about what to look for in a fulfillment service. Apart for price, speed and packaging quality I guess the main complexity is around dealing with say around 1000 backer orders where half of them were uniform and the other half were a mess of different rewards and al a carte orders (something i aim to avoid as far as possible). I presume thats the detail wherein devils lurk.

* PFC look OK http://www.parcelfromchina.com/warehouse/bondedwarehouse/ful... and are in shenzen like PandaGM (who seem to be the safest bet for game manufacturing).
* SFC seem bigger http://www.sendfromchina.com/default/warehouse
and there are more... I think Amazon now have 2 Chinese centres but I'm not sure if they do international fulfillment from there. If so, I guess that would work in cases where you also wanted amazon as your main point of purchase (like with Cards Against Humanity).

Re project manager being present during fulfillment... I guess thats an option for very large projects but thats another $2000+ expense that we are actually trying to avoid to keep fulfillment costs low, especially for international backers. If we find a trustworthy fulfillment service that should not be necessary.

Anyone seen a comprehensive breakdowns of total costs for transport of game from the (Chinese) factory to the backers hands? I need to get a handle on the intricacies.

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Adam Trzonkowski
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I did receive some quotes on freight from China to my location. This was rough but it broke out like so:

1500 games - 4 pallets - $2600
2000 games - 6 pallets - $3000
5000 games - 15 pallets - $4900
7500 games - 22 pallets - $6200

The max limit is actually 6900 games in a single shipping container. That is why the big jump in cost from 5000 to 7500.

That is to get it to my location. Then for US domestic I estimate $3-$5 per (we're looking at a card game). To Canada/Mexico it normally costs $7-$12. To Europe it can be as much as $20 and to Asia I've paid $30 once.

Hopefully that helps.
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Sturv Tafvherd
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Ferrel wrote:
I did receive some quotes on freight from China to my location. This was rough but it broke out like so:

1500 games - 4 pallets - $2600
2000 games - 6 pallets - $3000
5000 games - 15 pallets - $4900
7500 games - 22 pallets - $6200

The max limit is actually 6900 games in a single shipping container. That is why the big jump in cost from 5000 to 7500.

That is to get it to my location. Then for US domestic I estimate $3-$5 per (we're looking at a card game). To Canada/Mexico it normally costs $7-$12. To Europe it can be as much as $20 and to Asia I've paid $30 once.

Hopefully that helps.


That's great info!

But I think the idea behind this thread is to forego having that big shipment from China-to-US. Instead, the individual shipments to the backers are made from a distribution center in China.
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Adam Trzonkowski
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Agreed, I just thought having the total numbers by which to compare what a fulfillment company in China would cost might be handy.
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I had a plan...
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I'd be for it if the publisher flew over there for a couple of months, supervised production, and made sure that everything went well. However what's being suggested might leave the designer/publisher out of the loop with nothing more to review than samples/prototypes. It doesn't matter where the manufacturing is, the product really should go through you to make sure that there are no unforseen problems. I've heard of too many countersheets misaligned, token colors off, and other problems, that nobody anticipated and were caught at the last minute or not caught. Even if the QA is good, there are still plenty of misunderstandings or mistakes lurking out there.

If I knew that a project would be a run like this, I'd stay as far away from it as possible.
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Sturv Tafvherd
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Ferrel wrote:
Agreed, I just thought having the total numbers by which to compare what a fulfillment company in China would cost might be handy.


Yup! Indeed, it is still great info!
 
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Kim Brebach
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Thanks for sharing Adam. That does help but i have some more questions re those costs:

1. Included all intermediary freight between factory and ports and your destination warehouse?
2. How about customs charges and other fees taxes etc?
3. What dimensions and weight are these quotes based on? (presumably Havok and Hijinks? Not sure if thats likely to be KS game)
4. Any storage fees?
5. How about cost of packaging materials?
6. Labour costs for packing or costs for fulfillment company services?
7. If fulfillment services are used what costs need to be considered to cover the variety of versions of the game + extras you are likely to send to backers?
8. US, Canada / mexico, European, elsewhere costs - what USPS box size type of postage are you looking at? Any tips re key tipping points for size and weight?

heres a good article which covers some of these issues FYI [url]http://www.stonemaiergames.com/kickstarter-lesson-12-shippin... [/url]

I guess im wondering if any one else has seen something similar or more in depth than that? Threads here or blog posts elsewhere maybe?
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Kim Brebach
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autumnweave wrote:
I'd be for it if the publisher flew over there for a couple of months, supervised production, and made sure that everything went well. However what's being suggested might leave the designer/publisher out of the loop with nothing more to review than samples/prototypes. It doesn't matter where the manufacturing is, the product really should go through you to make sure that there are no unforseen problems. I've heard of too many countersheets misaligned, token colors off, and other problems, that nobody anticipated and were caught at the last minute or not caught. Even if the QA is good, there are still plenty of misunderstandings or mistakes lurking out there.

If I knew that a project would be a run like this, I'd stay as far away from it as possible.


You are talking production QA here rather than fulfillment QA which is the substance of this thread. I agree with your thoughts on production QA though. Thats why im most interested in Panda GM who seem to have an excellent reputation for QA, AFAICS (including sharing prototypes). For me its a no brainer to pay a little extra to manage QA risks best.

If that logic of using reputable processes at the production step is sound, then surely it can be extended to fulfillment too. Thats the explicit aim here. having said that, if spending a week in Shenzen to observe final production quality and oversee the fulfillment was financially possible within the campaigns costs I'd consider it for sure. But thats not really feasible for your small 20K projects, maybe for 50K + projects and moreso for the biguns.

Personally I haven't made a backing decision based on chain of production to distribution on any of the 7 projects I've backed. Although I've not been stung yet so not saying I wouldn't in the future.
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Kim Brebach
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Stormtower wrote:

That's great info!

But I think the idea behind this thread is to forego having that big shipment from China-to-US. Instead, the individual shipments to the backers are made from a distribution center in China.


That's kind of right Sturv:

kbrebach wrote:

So im wondering how feasible it is for;
1. all fulfillment to be done by a chinese fulfillment company with good QA
2. Some fulfillment eg just those outside US , to be done a chinese fulfillment company resulting in lower international backing costs (reduced shipping costs and reduced international postage)

Shipments to distributors would still need to go out as usual I guess.

... ie if the KS game was also going out through normal distribution channels to online and brick and mortar stores you would still need to do slowboat shipping of those, albeit at some saving if you subtract the chinese fulfilled games from that shipment, as Adams figures demonstrate. The aim here is to minimise pointless shipping costs of KS games to the US when they can be fulfilled cheaper from China than the US anyway. Based on costs and other decisions there may still be a need to do domestic US fulfillment from US companies - it'll differ project by project I'm sure. But the costs of international distribution are stifling international backing. What if you could double the level of international backing (25% of many games backers) without taking a loss on international fulfillment? There are also some cases where games will never get to distribution and will really be only be available via KS. This fulfill from china model may be even more interesting to them as they may avoid some shipping costs.

BTW you would have to have certain knowledge of your games hotness to even consider a print run of 5K. I think 1.5K to 3K is the most realistic print run size for gamers games... of course you can be a little agile depending on the KS success or not.
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monchi
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So here i think is the main issue with your idea and a reason why things are the way they are. Shipping things within the US are infinitely cheaper than shipping things domestically in just about any other country. I see people in the US shipping things across the US for cheaper than I can courier things across town. So you have 2500 games made in China and shipped to the US. You can then distribute those games within the US for dirt cheap.

Here is the major issue facing shipping games around the world, brokerage. I know that a lot of self publishers in the US will often use the USPS to ship games, but fulfillment companies will tend to use actual courier companies. As soon as you get a courier involved you are now looking at brokerage fees. Brokerage fees can be anywhere from $25-65 on an order. This is why international shipping is so high. The Amazon's of the world have networks set up that allow them to ship large consolidated orders to hubs. So rather than clearing say 100 separate orders at $25 each they clear all 100 orders together resulting in brokerage fees that are a fraction of the cost. Not only this but by consolidating they are paying less for the bulk of the shipping costs as the expensive international shipping is now greatly reduced.

There really is only one solution to this problem. What it would take is someone to partner with the person/company in the US running the KS. So for instance you have a company in Australia that partners with someone in the US on a KS. When the games are produced the manufacturer then ships bulk orders to the US and to the Australia company. The Australian company then distributes the games within Australia thus cutting out the expensive international shipping. The only way this would work however is if in the KS campaign there is a level set for say orders from Australia, so say 500 games needs to be committed to in order for it to be successful. You would need to figure out at what quantity it would make sense to ship an order direct. I don't know if you will ever find a way to internationally ship single games to people cost effectively.

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Kim Brebach
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Yeah I've explored the option of an AU games company with an online store doing KS fulfillment but there are many complications with that model. The coordination overheads vs the volume of games we are talking about just don't make it viable, along with tax and other complications.

AFAICS some of the chinese FSs use chinese international postal services rather than couriers internationally. It's hard to believe they would be more expensive than the cost of freight shipping those games to the US and then coming back to AU (or wherever) via fulfillment through international USPS.

But I have to get specific figures from a reputable chinese fulfillment service. That's the immediate challenge for the next few weeks. I will keep you posted.

heh.
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Jools Thomas
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If I were only in China and not Japan I would totally start up a KS FS myself. Sigh.
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John A. White
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Jools wrote:
If I were only in China and not Japan I would totally start up a KS FS myself. Sigh.

With the goal of euro fulfillment it seems that the western border of China is an attractive base location.
 
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kbrebach wrote:

22 backers in Asia who are receiving at least one copy of the game (2.4%), 23 backers in Oceania (2.5%), 682 in the US (75.7%), 51 in Canada (5.6%), 114 in Europe (12.6%), and 8 in Brazil (1%).

So 25% international backers.

So im wondering how feasible it is for;
1. all fulfillment to be done by a chinese fulfillment company with good QA
2. Some fulfillment eg just those outside US , to be done a chinese fulfillment company resulting in lower international backing costs (reduced shipping costs and reduced international postage)


Every time I see threads like this I shake my head. I get the good intentions, but they always overlook some fundamental costs. Firstly, you say '25% international backers,' but the percentage of them that will actually get a better deal (accounting for shipping alone) out of China would only be those in Oceania and Asia - so a 5% of the backers. Europe may or may not receive a better deal - usually it's better for them to wait for it in the regular distribution channels anyway (i.e. buy it at retail).

Point being 25% international backers does not mean 25% international backers that will benefit from distribution from China.

Figuring on a possibly significant benefit to only 5% of backers (or your market), you want a company to establish a distribution point in China - which will have to be paid for. With such a small number of orders to be fulfilled (and taking economies of scale into effect), such a fulfillment cost would be quite high to begin with.

So you now have shipping costs (which will still be mostly international rates from China to single backers anyway - so not nearly as cheap per unit as boating them to the US) plus distribution costs. If any assembly and storage that would have been done in the US now has to be done in China, then those costs need to be factored in too.

I cannot see how this would be any cheaper to accomplish for that 5% of international backers who would benefit from cheaper shipping, but would then have to cover the costs for the (more) localized distribution point. Unless you're expecting everyone else to cover those costs as well - in which case it would probably still be better for everyone to just pay a bit extra to cover your shipping costs. So 95% of people paying more to make 5% happy.

If you honestly want a workable model, you'd have to start off with a much greater interest in board games in your area. Otherwise your best bet is to push for P&P files and make your own copy of the game from them. Of course that would mean that the company involved would have 100% faith in you that you won't go printing out dozens of copies and selling them - which is a tall-order to ask.
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aVoidGames wrote:
Jools wrote:
If I were only in China and not Japan I would totally start up a KS FS myself. Sigh.

With the goal of euro fulfillment it seems that the western border of China is an attractive base location.

Buh? Western China? Xinjiang? That's as far as you can get from anywhere! BFE! Jeez louise, you ship things from ports and Western China is basically landlocked Central Asia. You know that part of the Risk map that nobody ever fights over because it's worthless? Yeah, that.
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Kim Brebach
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TheNameForgotten wrote:
kbrebach wrote:

22 backers in Asia who are receiving at least one copy of the game (2.4%), 23 backers in Oceania (2.5%), 682 in the US (75.7%), 51 in Canada (5.6%), 114 in Europe (12.6%), and 8 in Brazil (1%).

So 25% international backers.

So im wondering how feasible it is for;
1. all fulfillment to be done by a chinese fulfillment company with good QA
2. Some fulfillment eg just those outside US , to be done a chinese fulfillment company resulting in lower international backing costs (reduced shipping costs and reduced international postage)


Every time I see threads like this I shake my head. I get the good intentions, but they always overlook some fundamental costs. Firstly, you say '25% international backers,' but the percentage of them that will actually get a better deal (accounting for shipping alone) out of China would only be those in Oceania and Asia - so a 5% of the backers. Europe may or may not receive a better deal - usually it's better for them to wait for it in the regular distribution channels anyway (i.e. buy it at retail).

Point being 25% international backers does not mean 25% international backers that will benefit from distribution from China.

Figuring on a possibly significant benefit to only 5% of backers (or your market), you want a company to establish a distribution point in China - which will have to be paid for. With such a small number of orders to be fulfilled (and taking economies of scale into effect), such a fulfillment cost would be quite high to begin with.

So you now have shipping costs (which will still be mostly international rates from China to single backers anyway - so not nearly as cheap per unit as boating them to the US) plus distribution costs. If any assembly and storage that would have been done in the US now has to be done in China, then those costs need to be factored in too.

I cannot see how this would be any cheaper to accomplish for that 5% of international backers who would benefit from cheaper shipping, but would then have to cover the costs for the (more) localized distribution point. Unless you're expecting everyone else to cover those costs as well - in which case it would probably still be better for everyone to just pay a bit extra to cover your shipping costs. So 95% of people paying more to make 5% happy.

If you honestly want a workable model, you'd have to start off with a much greater interest in board games in your area. Otherwise your best bet is to push for P&P files and make your own copy of the game from them. Of course that would mean that the company involved would have 100% faith in you that you won't go printing out dozens of copies and selling them - which is a tall-order to ask.


Thanks Val. Yes its just an initial investigation I'll be doing and you are generally correct. For each destination country / region the costs of road to fulfillment center + fulfillment handling + postage via China would need to be cheaper than the cost of road to port + shipping (small % of larger shipping to US) + fulfillment handling + postage from the US to those international destinations. Volumes may affect these prices. Happy to consider other costs ive missed.

I expect the Americas should be cheapest in total from the US of course. I agree Europe may be borderline or cheaper to manage from somewhere in Europe. Asia and Oceania are indeed only small markets currently but the % of orders from those and other international regions are undoubtedly suppressed by the high postage costs from the US. So the potential market is somewhat higher than the apparent one reported from KS campaigns that have prohibitively high international backing costs.

example Hero Brigade
$25 for the basic game + $35 for international backers. That's really probably up to $10 postage already incorporated into core costs (ie 'free' US postage) + $35, so really $45 postage for international (europe, asia and oceania) backers for what is really a $15 game!!! I'm just trying to find an alternative to that situation which is clearly whack. I may not find one and thats fine.

I wonder what the regional spread of backers for games with more flattened backing costs is? eg Myth ($13 international) or A Study in Emerald (free postage everywhere)? I'll try and find out.
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Hey Kim,

If you have a real spread of backers from around the globe I would suggest moving stock to Hong Kong. There are hundreds of companies there that can check, pack and send stuff for a reasonable price. Shipping cost to Asia Pacific and Europe will definitely be much cheaper out of Hong Kong.

I hope this helps.
Alex
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