9 Predictions for Cross border E-commerce in 2025
Too long to read:
1. Global 2025: Global GDP growth of 2.8%, US growth of 1.9%, EU growth of 1.3%, China growth of 4.8%;
2. US 2025: The largest "variable" is Trump, and the probability of tax increase of 60% is small. Goods stocking continues to be hot in the first half of the year;
3. Europe 2025: Slow economic growth, looking at the degree of US tax increases, looking at the energy crisis, buyer consumption will recover;
4. Amazon: Transforming "single level inventory" into "gradient inventory", integrating supply chain management, and guiding sellers to "high turnover";
5. First leg: tight air freight, fluctuating freight rates, and binding with commercial flow; Abundant sea freight, fluctuating freight rates, and multiple factors interfering;
6. Overseas warehouse: The track will still be hot in 2025, and the replenishment cycle of this round will end around the fourth quarter, finally returning to the "strong always strong" trend;
7. Platform pattern: 'TikTok refugees' are unexpected, filling in the gaps in platform competition, and sellers'' multi-channel layout;
8. Compliance trend: The United States continues to tighten the $800 tax exemption, and new EU tax exemption regulations are about to be introduced, strengthening the trend of compliance;
9. The RMB exchange rate: fluctuates in both directions, moderately depreciates, and is greatly affected by the US tax increase, hovering around 7.3% throughout the year.
The following is the main text:
01. 2025: Global GDP growth of 2.8%, US growth of 1.9%, EU growth of 1.3%, China growth of 4.8%
The first prediction, which has just been released, is the latest "World Economic Situation and Prospects 2025" released by the United Nations Department of Economic and Social Affairs. It is expected that global GDP will grow by 2.8% in 2025 and 2.9% in 2026.
The report suggests that despite withstanding a series of overlapping shocks, global economic growth has not yet recovered to the pre pandemic average of 3.2%. Geopolitical conflicts and trade tensions remain uncertain, but the good news is that inflation has decreased and monetary easing policies are expected to moderately boost the global economy.
Image data from the United Nations official website, barn mapping
Main predictions:
The growth rate of developed economies in 2025 is 1.6%;
The US economy is expected to grow by 1.9% in 2025 and 2.1% in 2026.
The EU will grow by 1.3% in 2025 and 1.5% in 2026;
UK growth of 1.2% in 2025 and 1.4% in 2026;
GDP growth in other major markets by 2025: Mexico 1.9%, Brazil 2.3%, South Korea 2.2%, Japan 1.0%, Vietnam 6.5%, Australia 2.2%, Russia 1.5%, Spain 2.45%, India 6.6%, Saudi Arabia 4.4%.
02. America 2025: The largest "variable" is Trump, and the probability of tax increase of 60% is small, and the stocking will continue to be hot in the first half of the year
Because Trump, the American market is the most difficult to predict.
In just over ten days of January, he would buy the Panama Canal, attack Greenland, rename the Gulf of Mexico as the Gulf of the United States, and turn Canada into the 51st state of the United States. With a punch in the sky and a kick on the ground, you might think he's on the 18th floor, but he's actually in the atmosphere.
Related to cross-border e-commerce: one tariff, one interest rate cut, and one logistics.
With regard to the tax increase, there is a big dispute. It may be Trump's bargaining chip: for example, he wants to open a window, but he threatens to tear down the house, so you agree to open the window.
Businessman's mindset prioritizes profit, and harming the enemy by 800 and losing 1000 is a loss making business. For example, he threatened to increase taxes by 20% on Europe to sell more oil to Europe, threatened to increase taxes on Mexico to help manage immigration.
It is predicted that the tax increase may be gradually pushed forward in the second and third quarters of 2025, with step-by-step testing, while evaluating the impact of tariffs on US import costs, inflation, and ordinary households, and then deciding on the next step.
The probability of a 60% overall tax increase is relatively low, while the probability of a differential tax increase is high: for example, imposing a universal benchmark tariff on all goods, implementing the old 301 policy on some goods, imposing specific high tariffs on electric vehicle photovoltaic chips, and turning a blind eye to trivial livelihood goods.
Reference 2022: Out of the $550 billion worth of goods exported by China to the United States, $150 billion will be subject to a 25% tariff, $100 billion will be subject to a 7.5% tariff, and the remaining $300 billion will be subject to a 2% -3% tariff.
The average tax rate is 12%, much lower than the initially proposed 45%.
Regarding interest rate cuts, it is predicted that the Federal Reserve will adopt a cautious attitude in 2025, with only 1-2 small interest rate cuts, totaling 50-75 basis points, targeting prices and employment. If inflation rebounds, interest rate hikes will resume.
The current "three highs" of high prices, high inflation, and high deficit in the United States cannot withstand the onslaught of strong drugs. Prices have increased by 60%, and the people need to warmly greet each other. What's out.
Regarding logistics, although the East Coast strike crisis was resolved in early January, the impact has already overflowed. In recent months, the cargo volume at US ports has surged year-on-year. Considering that tax increases may be implemented in the middle of the year, the stocking volume is expected to continue to increase in the first half of the year.
NRF predicts that container imports in the United States will still be a 'big year' in 2025:
Image unit: 10000 TEUs
03. Europe 2025: Slow economic growth, looking at the extent of US tax hikes, energy crisis, and buyer consumption recovery as highlights
The future and destiny of Europe are closely related to whether the United States will "raise taxes" on it.
The European Central Bank will cut interest rates three times in 2024, and currently inflation has dropped to a low of 2.0%, but it has not yet emerged from the energy crisis.
As of January 2025, the natural gas storage rate in Europe is 69%, far lower than last year's 85%; Starting from January 1, 2025, Russia will terminate the transit of natural gas from Ukraine to Europe, which accounts for 50% of Russia's total pipeline natural gas exports to Europe.
It is predicted in 2025 that Europe will be sold liquefied natural gas (LNG) in the United States by Trump. If it does not buy LNG, it will be threatened by tariffs.
Everyone, selling high priced gas and being a "oil seller" is the career plan of Mr. Chuan, there is nothing else but skilled hands.
Other predictions: The European economy will slowly recover by 2025, with a GDP growth rate of around 1%. The good news is that European officials expect a recovery in European consumption as buyers' wages and savings increase.
EMarketer predicts that 2024 will be the first year in which retail growth in Europe exceeds inflation. It is expected that the economies of the five Western European countries will rebound and e-commerce will resume growth of 5.0% from 2025 to 2026, with steady growth in the coming years.
The Russo Ukrainian war is still a "hot spot" in Europe, and if a ceasefire is also achieved this year, Europe's recovery will be faster.
04. Amazon: "Single level inventory" becomes "gradient inventory", continues to integrate supply chain management, guiding sellers to "high turnover"
After the implementation of the "Eight Regional Network" initiative, Amazon will officially announce its "Supply Chain Intelligent Hosting" service by the end of 2024, with a focus on enhancing AWD's "gradient inventory" status
AGL is responsible for the first leg transportation and partial warehousing, AWD is responsible for the buffer inventory of FBA, and FBA is responsible for regional fulfillment and distribution.
The purpose of the reform is to reduce costs and increase efficiency for FBA, shifting from emphasizing scale to emphasizing high turnover under the premise of limited storage capacity. The FBA operating rules faced by sellers have changed.
By 2025, predict three scenarios for Amazon:
(1) Gradient caching: Establishing cache warehouses in areas with cheap warehousing can shorten the FBA appointment delivery cycle by half, help FBA disperse pressure, and form a "gradient inventory" in the United States.
(2) Third level inventory: The tariff war will force sellers to purchase from multiple countries around the world and export to the United States, forming a first level gradient inventory at ports in each country; Collect and distribute goods in the United States to form a second level gradient inventory; Finally, it will be distributed to FBA in different regions to complete the third level gradient inventory.
(3) Integrating the supply chain: providing one-stop "end-to-end" hosting, significantly reducing supply cycle delays in the handover of "collection, clearance, transfer, warehousing, and distribution", and dynamically reducing safety stock.
Summary: Accelerate turnover, reduce inventory, complete the transition from an "efficient supply chain" to an "agile supply chain", and make FBA, the elephant, run quickly from the starting point to the end point.
05. First leg 2025: Air freight capacity is tight, costs are rising, and it is tied to commercial flows; Abundant shipping capacity, continued detours, and multiple factors interfering
The air freight market has both upward and downward platforms.
After the rise of "full custody", air freight shippers have transformed from American retail giants to Chinese e-commerce platforms, with T86 growing six times in four years, fundamentally changing the pattern of air cargo transportation between China and foreign countries.
Providing 50% of the transportation capacity to Chinese e-commerce platforms through direct delivery of small packages has also made air freight almost tied to commercial flow: the platform is like a faucet valve, where changes in traffic → affect order volume → affect cargo volume → affect freight rates.
The contract price in 2025 may be affected by the December freight rate; Retired passenger/cargo aircraft resources are scarce, and capacity peaking is inevitable; The Asia Pacific region may face rising costs and decreasing demand. In addition, the direct shipment volume and freight rates also depend on: the new duty-free policy for small packages in the destination country, customs inspections, and the resumption of the Russia Ukraine ceasefire on the Siberian Golden Route.
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Sea freight is the opposite of air freight, with too much capacity. Shipbuilding is not as good as building airplanes, as one ship only has thousands or tens of thousands of containers.
In 2024, shipping companies were extremely lucky, with a global increase of 3 million TEUs in capacity, a year-on-year increase of 10.6%. This was originally a year when a large number of new ships were launched, there was inevitably an excess of capacity, and freight rates were bound to fall to a dog. However, most of them were absorbed by the Cape of Good Hope, with only 0.6% of idle capacity, opening low and rising high, earning a lot of money.
Looking further ahead, even if there is a ceasefire in the Middle East in 2025, it will continue to bypass:
The peace agreement process is complex and ever-changing, and the shipping company is concerned about the possibility of accidental incidents at any time. Considering the safety of the crew and cargo ships, they will observe for a period of time; Reorganizing the shipping schedule and returning to the Red Sea navigation order will take several months; The Suez Canal has suffered severe losses in the past year, and tolls may be adjusted after reopening.
Two pieces of good news in early 2025 are the cancellation of the East Coast strike and the restructuring of the shipping alliance;
The bad news is that freight rates at this stage have not yet reflected Trump tariffs. If taxes are increased or China's shipping industry is suppressed in stages, will it cause a new wave of "cabin grabbing and cargo hoarding"?
06. Overseas warehouse: The track will still be hot in 2025, and the replenishment cycle of this round will end around the fourth quarter, finally returning to the "strong will always be strong" trend
2024 is a bull market for overseas warehouses, and it is expected to continue in 2025.
Inventory 2024:
Conservatively estimated, the entire industry added over 2 million square meters of overseas warehouses in the United States last year, with a plethora of large and small warehouses, as well as new and family warehouses.
4 reasons: The United States has entered a new round of "active inventory increase" cycle, and the mood of Trump's tax increase and the strike in the United States and East Asia has stimulated the acceleration of replenishment at the end of the year; The enthusiasm for restocking large volume categories such as furniture and home appliances is high; The rise of "semi custodial" business has driven the overseas warehousing and distribution model; FBA peak season congestion leads to demand overflow from third-party warehouses.
Prediction 2025:
Under the prosperity, the overseas warehouse industry is also facing the dilemma of "where to go". Especially after FBA launched the "Supply Chain Intelligent Custody" service, it brought the entire logistics industry into the "fast lane", accelerating the change in the underlying logic of the industry and further accelerating the cost reduction of e-commerce fulfillment services.
FBA benchmarks ahead, falling behind will be beaten.
In the next 2-5 years, "partition+gradient inventory" will become the mainstream model. Assuming that one district in the United States requires 100000 to 200000 square meters of overseas warehouses, and five districts make up 500000 to 1 million square meters, this will become a new threshold for competition in the US market. Those who lag behind the platform average may be eliminated from the table.
