Introduction:
The overseas-warehouse boom looks impressive on the surface—but behind the scenes, many operators are struggling. Warehouses look full, teams look busy, yet the final numbers often tell a colder truth: Who is truly making money, and who is simply holding on?
Is your overseas warehouse profitable?
Are you still using revenue from your domestic business to subsidize overseas operations?
Over the past two years, as cross-border e-commerce continues to surge, more logistics companies have rushed to build overseas warehouses. Whether they specialize in FBA first-leg shipping or small-parcel lines, everyone is expanding abroad. Warehouses are opening everywhere; shelves are packed to the ceiling; operations teams are running nonstop.
But once the month-end financials come in, many discover an uncomfortable reality: profit margins are thin—and for some, negative.
“The warehouse is busy, but the money isn’t coming.”
T
his was the most common line we heard during our field visits. Many operators find themselves stuck in the same paradox: business volume looks good, the warehouse feels active, yet domestic operations are still the primary source of real income.
So where does the problem start?
1. Filling the warehouse ≠ building a profitable business
In
the early stage, many overseas warehouses have a simple goal: fill the space. They accept any customer and any SKU. But as the customer mix grows more diverse and SKUs explode in number, cracks quickly appear:
systems can’t keep up,
- processes aren’t standardized,
- automation is lacking.
- To cope with complexity, companies hire more people. More people lead to more management overhead:
lower efficiency,
- more mistakes,
- more exceptions and rework.
- Before long, the operation slips into a cycle of being busy but not profitable.
2. The real challenge: managing overseas teams
Hir
ing and managing staff overseas is far more complex than doing so domestically. Labor costs are high, turnover is fast, and overall efficiency tends to be lower.
In regions like Europe and the U.S., where wages are among the highest in the world, a small mistake in staffing or workflow can wipe out the month’s profits. Many managers end up fighting operational fires daily, leaving no energy to optimize processes, expand customers, or adjust strategy.
3. Domestic profits become the “lifeline”
To s
urvive the early “tuition-paying period,” many companies use domestic profits to cover overseas losses. But this model is fragile—once the domestic market shifts, the entire structure becomes unstable.
This is why so many warehouses look busy, yet their financial foundation remains shaky.
So who
does
make money?
Interestingly, the truly successful overseas warehouses share a few common traits:
Clear positioning
They know exactly which customer segment they serve and don’t try to be everything to everyone.
Steady, disciplined expansion
No blind land-grabbing, no over-building for the sake of scale.
Relentless focus on systems and automation
They invest early in technology to avoid drowning in SKUs and manual processes.
Strong management capability
They build teams and processes that can operate sustainably in high-cost labor markets.
For these companies, overseas warehouses aren’t a quick-profit project—they’re a long-term strategic asset.
The truth: Overseas warehouses can be a second growth engine—if managed correctly
Overse
as warehousing does have the potential to become a company’s next growth curve. But only for those who recognize its nature:
heavy upfront investment,
- slow payback,
- complex operations,
- high managerial demands.
- It’s a marathon, not a sprint. Those who endure the early-stage burn will be the ones positioned strongest in the future cross-border landscape.
Final Thought
The glo
bal warehouse boom is real—but the real test isn’t enthusiasm. It’s operational discipline and long-term thinking. After all, a warehouse can be full to the brim, but without profit, it won’t stand for long.
What about your overseas warehouse?
Are you busy but barely breaking even—or have you already found a path to profitability?
Share your experience in the comments. We’d love to hear your version of the “overseas warehouse truth.”