Why buy from Alibaba?
Nowadays almost 99% international buyers know this ecommerce platform globally. Alibaba is B2B platform, which you can find the needed products for your business, almost anything, machinery, electronics products, daily consumer products…you name it. Alibaba is a window, thousands of buyers has opportunity to get in touch with a great majority of manufacturers in China through this window.
Pros of Alibaba
- Lower price
- Thousands of suppliers to choose from.
But the fourth and most important advantage Alibaba has to offer is the networking benefits. Alibaba has an ever-expanding network of users/suppliers catering to various products and services. Which means you’re always going to have new stuff to choose from and new suppliers to build relationships with.
There are also quite a few risks when using Alibaba to find a supplier.
Cons of Alibaba
- Language and communication barrier can be difficult to overcome.
- Longer shipping time especially for bulk order with sea freight.
- Poor customer service especially for small factories with unqualified sales.
Language problems is easy to overcome. Since you contact with suppliers for the first time unlike the meeting in trade show, so it takes time to build business relationship/mutual trust. When you met with disqualified sales, you need to spend lots of time to push push push the schedule of timing.
There are different types of sellers on Alibaba, basically 3 types as below
- Manufacturers
- Wholesalers
- Trading company
Most of suppliers on Alibaba is Manufacturers. Almost all medium and large factories has opened Alibaba to boost the sales internationally. Since there are so many factories sell same products and if you don’t invest money to advertisement on this platform, sellers can not acquire more traffic and exposure. When you search the listings on Alibaba, make sure to dig more sellers, the sellers ranking top maybe not the best, just because they invest more money into it.
You can easily distinguish if this supplier is manufacturer or trading company. Open the listing and click company profile and then find business type as below pictures.
Manufacturer VS Trading company
There are also trading companies but they also has factories and they just use the trading company to do business globally. In this scenario, it depends on what kinds of products you are planning to buy. If you buy hundreds kinds of daily consumer products, you can not have them all in one factory, you may need to buy from more than ten factories and complicated to consolidate all cargos into one container. The best way is to find trading companies as they can source all products for your business and consolidate them all into one delivery.
If you buy big machinery or specific products, the best way is to buy from factories directly, which is much more cheaper than trading company and also good for aftersales service.
One advantage for trading companies is the fast communications and good service. Why trading companies can still exist? Why buyers don’t buy from factories even though they know factories can offer better price? Why? That is because service always matters. Sometimes you need to wait two days until you get answer from factory and you always need to push them to get what you want.
Another advantage is trading companies can provide small MOQ, some trading company are wholesalers and their clients are small business owners globally. Trading companies can collect all orders and buy from factories from time to time so they also has price advantages. As you know, there are lots of small workshop in China and they don’t do business directly with global buyers. All the products they produced, all service for trading company.
How to search on Alibaba
The easy way is type the “key words” and choose “best match” and then you get thousands of suppliers, most of people use this way and I suggest this way too.
Make the best use of Alibaba filter system.
- Trade Assurance Suppliers
Trade Assurance is a free service offered by Alibaba that’s designed to help create trust between buyers and suppliers. Trade assurance means you’re covered if the products you ordered aren’t shipped on time & Your products don’t meet the quality standards
If either of these happen to you, Alibaba will pay for the goods and you’ll get a full refund. So using Trade Assurance is a fantastic way to avoid scams! So how do you use this feature? When searching for products/companies through Alibaba, check off the button that says “Trade Assurance.”
- Verified Suppliers
Verified Alibaba suppliers may be the very best suppliers to do business with. Why? These suppliers are all those who have been inspected onsite by a third-party inspection company.
They offer all the information for Alibaba’s Factory Audits, including…
- Assessment Reports
- Verified Videos
- Verified Main Products.
To deal with assessed suppliers, simply check off the “Verified Supplier” button, and skim through the suppliers and products available.
RFQ function, means “Requests for Quotation”.
If you don’t want to choose and send your inquiry to one by one suppliers, then you can use RFQ function of Alibaba. Get in this link of RFQ page https://rfq.alibaba.com/ and post your procurement inquiry, and then you can get more than ten quotations from related suppliers.
If you are new to this field, you can use RFQ to compare price. For experienced buyers, I don’t suggest this way. Because there is a chance you got lots of garbage quotations, which is a waste of time to check one by one.
How to verify a company’s background
- Business license
- Company or factory location
- Contact information
- Certifications of products
- Onsite video communications
The documents is easy to make a fake. In my opinion, after you verified all the documents, it is better to communicate with video and you can see the workshop, or office onsite. If the products has certification, then you can ask the certification first and verify on website to see if it is real. Normally the company name is same as the certification title company. After all of this, if you still worry, you can go to China to see by yourself if the order value is big, you know, seeing is believing.
DavySourcing.com offer free service to help overseas buyers verify supplier’s qualification. You may not know if the supplier you are dealing with is legit or fraud company, we will help you to verify if the supplier is trading company or manufacturer. In this way, we can help to reduce the potential risks.
Questions to ask your Alibaba suppliers
Once you’ve evaluated your supplier and you’re ready to make your choice, there are a few final things you need to know, such as…
- What are the payment details? You need to know exactly how much you’re paying per unit. You’ll also want to know of any bulk discounts you might be able to get.
- Is there a refund policy? You need to know exactly what their refund policy is. There shouldn’t be any debate when the time comes to refund a customer.
- What to do about disputes? You’ll want to have a clear plan of action when a dispute arises. If a consumer is unhappy with a product (or with delayed shipping times) and threatens your business, will your supplier work hard to help you solve the problem?
- Are there any seller guarantees? It’s vital to both your company and consumers to know if there are any guarantees that come with the supplier. Will they offer a 30-day money back guarantee if the consumer doesn’t like the product they ordered? Or can they only return it if it’s defective?
- All details need to confirmed by email and put it into official contract.
Request samples and Price Negotiation
By ordering products and having them shipped to you, you accomplish three things:
- You see how long shipping times are. Normally it depends on what kinds of courier you choose. If you are planning to order in big quantity, you can ask supplier to provide free samples to you but most of suppliers will say the samples can be free but you need to take charge of the delivery costs, or they charge the sample fee and will deduct from bulk order if you place bulk order after samples satisfaction.
- You’re able to get an idea of their packaging quality. Will you feel comfortable with your customers receiving the package?
- You see the product quality. How well does it hold up? Product quality is very important for long-term success.
It is important to hire Third party to inspect the Quality. What do you do if the quality can not meet your requirement.
When finish production, you need to hire a Third party to inspect the quality of goods, which is very important because if you find defected goods after delivered, it will be hard to rework and you will suffer big loss, especially for Ebay or Amazon ecommerce sellers, as you know, reviews is extremely important, bad reviews maybe kill this products selling.
You can easily find a third party on Alibaba, or you can reach to us, we DavySourcing can provide QC inspection service for your business.
Shipping forwarder
Easy to find, just Google it and then you can find top shipping forwarder ranking 20 globally, choose one and ask the supplier to provide packaging details e.g. weight, packaging quantity, CBM info and ask quotation from forwarder. After choosing the right forwarder, send the contact info of your suppliers, they will proceed the delivery issues.
If you don’t want to find one, normally suppliers has cooperation partner of forwarder, supplier can arrange it for you. I suggest you choose forwarder by yourself especially when the trading term is FOB. We have years cooperation with shipping agent in China and can offer competitive price for your business.
Conclusion
If you have any questions, feel free to reach out to us!