What role does iHerb’s global supply chain and logistics play in its competitive pricing?

iHerb’s global supply chain and logistics play a crucial role in enabling its competitive pricing by optimizing inventory management, leveraging advanced automation, and strategically locating fulfillment centers near major shipping hubs. This combination reduces shipping times and costs, improves order accuracy, and enhances overall supply chain efficiency.

Key factors include:

• Advanced automation and technology: iHerb uses a highly automated order fulfillment system, such as the Perfect Pick goods-to-person picking technology, which speeds up order processing and reduces labor costs. This system efficiently handles millions of units and ensures fast, accurate picking and packing.

• Strategic fulfillment center locations: By situating fulfillment centers close to international shipping hubs and major customer regions, iHerb reduces transit times and shipping expenses, enabling faster delivery and lower logistics costs.

• Supplier collaboration and data integration: iHerb partners with over 800 suppliers and uses electronic data interchange (EDI) to streamline inventory management, demand forecasting, and replenishment. This reduces errors and stockouts, optimizing inventory levels and lowering carrying costs.

• Global logistics network and regional hubs: For international markets, iHerb leverages regional transit hubs and trusted logistics partners to consolidate shipments, avoid bottlenecks, and minimize last-mile delivery costs. This operational design keeps shipping costs affordable for customers worldwide, supporting competitive pricing.

Together, these supply chain and logistics strategies allow iHerb to maintain a large, diverse product assortment with fast, reliable delivery at lower costs, which directly supports its ability to offer competitive prices to customers globally.