Kamal Ghorui
Amazon is making a fresh push into China nearly seven years after shutting down its local marketplace, and this time the company is focusing on logistics rather than direct competition with domestic rivals. The e-commerce platform has launched its first Global Warehousing and Distribution (GWD) centre in Shenzhen, marking a new strategy aimed at supporting Chinese sellers who export goods to global markets, especially the United States. According to a report by the South China Morning Post, the company is aiming to cut storage costs for local merchants by up to 45% as competition from Chinese rivals Shein and PDD Holdings’ Temu intensifies in cross-border trade. The move signals Amazon’s return to China in a different role after its earlier e-commerce business struggled against strong local players.
Amazon’s different strategy after past failure
Amazon first entered China in 2004. However, it failed to compete with platforms like Alibaba Group and JD.com that comparatively offered faster delivery, better payment systems and services tailored to local users. Over time, Amazon’s market share dropped sharply, and it shut down its domestic marketplace in 2019.Now, instead of trying to win Chinese consumers, Amazon is targeting Chinese merchants. The new Shenzhen facility will act as an “all-in-one” logistics hub, helping sellers manage storage, customs clearance and shipping from China to overseas markets.
Cutting costs to attract sellers
As per the report, Amazon said the new system could reduce storage costs for Chinese sellers by up to 45% compared to keeping inventory in US warehouses. Shenzhen is a key location for this effort, as it is one of China’s biggest manufacturing and export hubs, home to a large number of cross-border e-commerce sellers.Amazon’s renewed push comes as competition intensifies globally. Platforms like Temu and Shein have rapidly expanded and gained market share in international markets. These companies are investing heavily in supply chains and logistics, making it harder for Amazon to retain sellers. At the same time, changes in US and European import rules are adding pressure on low-cost cross-border shipments, creating new challenges for Chinese exporters.Further, Amazon plans to expand this warehousing model to other manufacturing regions in China, including the Yangtze River Delta, and extend distribution services to Europe and Japan.The move shows that while Amazon may have lost the local e-commerce battle in China, it is now trying to stay relevant by becoming a key logistics partner for Chinese businesses selling to the world.
