It’s no secret that there are a lot of options to consider when looking for suppliers on this platform, making consumers wonder how does Alibaba work? Finding the right supplier on Alibaba can be challenging as it’s a competitive wholesale marketplace boasting thousands of suppliers competing for your business.
Nevertheless, using Alibaba.com is a great way to save time and buy at a low price due to its faster process than trying to source from someplace else. However, with so many horror stories of customers being taken advantage of and scammed on Alibaba, you should clearly know what to look for and avoid when sourcing from this marketplace.
Fortunately, there are tips and tricks you can use to effectively buy from Alibaba in order to avoid mistakes that will cost your company time and resources. Here are some key strategies to help you navigate the seemingly endless options of suppliers and find the best one for your business!
1. Perform Your Own Due Diligence to Avoid Getting Scammed
Selecting a supplier to collaborate with and who you can rely on for your business will certainly require plenty of consideration and assessment from your side. Once you’ve narrowed down your supplier list, delve into the background and history of these suppliers.
Conduct a keyword search of the factory’s name including the term “scam” or similar. Check to see if they have gone bankrupt before, see how many employees they have, and note how long they’ve been in existence.
The more information you can gather about a supplier the more confident you can be in your decision to partner with them.
2. Look for Certain Signals That Alibaba Suppliers Display on the Marketplace
Alibaba has several displays to let you know the status of a wholesaler. To check a supplier/s credibility, it’s best to familiarize yourself with the different signals that suppliers display on their profiles. This will guide you in making better decisions about whether you’ll take someone as a partner for your business or not.
Gold Membership
Suppliers can pre-qualify themselves by purchasing an Alibaba gold membership. The supplier then needs to satisfy 3 criteria that are designed to demonstrate their commitment and professionalism. These 3 criteria are:
- Authentication and verification check
- On-site check at the supplier’s premises
- Verification of the supplier’s main products, certifications, product flow, product videos etc.
Verified Suppliers
As an alternative to Gold Membership, suppliers can qualify themselves as verified suppliers which gives their products some blue colour. This can be seen through a small Verified logo on their posts.
How do you qualify as a Verified Supplier? According to Alibaba group:
“To qualify as a Verified Supplier, a supplier’s company profile, production capabilities, products and process controls have to be inspected, assessed and verified by independent third party institutions to assure reputable and consistent expertise on Alibaba.com”
The third parties Alibaba uses to carry out the Verification checks are legitimate QC firms such as SGS, Intertek, and TUV Rheinland so this certainly adds a level of credibility to the supplier.
The verified feature allows you to view a fair amount of useful information at a glance, as demonstrated in the screenshot below.
Trade Assurance
Look out for Trade Assurance badges, which indicate the supplier is signed up under Alibaba’s own in-built customer protection program. It’s possible to filter searches using the Supplier Types filter on the left hand side.
Alibaba protects customers that buy products from suppliers who have signed up for their “Trade Assurance” program when it comes to product quality and delivery date issues. In the event of a dispute or issue, Alibaba will investigate and resolve the issue for the customer and will offer a refund if necessary.
Look for the Gold Crown and words as seen in the image below.
Assessed Suppliers
Alibaba conducts 3rd party background checks on those sellers that are looking to distinguish themselves by being more transparent. This increases a supplier’s credibility, thus influencing your decision of whether you’re going to choose to work with them or not.
3. Buy Safely by Reviewing Suppliers Transaction History, Reviews, and Ratings
You can review a possible supplier’s information by being a “Verified Buyer”. This will give you the benefit to see some additional supplier information that may help you to make a more informed decision on who to partner with.
Alibaba publishes a “Suppliers’ Detailed Analysis”, this dashboard breaks down a supplier’s
- Main products
- Monthly Shipment Volume
- Main Export Countries
- Main Customers
4. Get to the Point When Asking Potential Source Questions
Prioritize asking a potential supplier if they can make or supply your product or not rather than bombarding them with a list of questions in your first message.
There’s nothing wrong in asking questions and it can be tempting to immediately know about the shipping costs, minimum order required, or import taxes. However, the conversation may take a long time until you get to the main point and this may be the case if you’re talking to suppliers from overseas.
With the different time zones, you’d have to wait for their response first before you can get answers to your more critical inquiries. This is why it’s important to know first whether suppliers from Alibaba can source products you’ll need before you dive into other questions.
5. Request an Actual Sample Before Buying Wholesale
Suppliers usually indicate specifications and photos of their products which can be very helpful for buyers. However, their products can sometimes turn out to be different than what’s specified on the platform, making it ideal to ask for a sample first before proceeding with buying in bulk.
After successfully acquiring a sample, test them immediately to see if they work as they’re supposed to. Asking for samples may cost you more initially since some suppliers tend to have minimum order quantities. But paying extra at first would be better than ordering large quantities of materials that would turn out to be defective or useless in the end.
Once you’ve decided on a supplier and are satisfied with the sample, you may want to place a new order using a Purchase Order (PO). This document is sent to the supplier detailing all the relevant information about your order, payment, and shipping terms.
Although this document is not totally required, this document may serve as a binding contract between buyers and sellers to ensure a streamlined and transparent process.
Buy From Alibaba Safely
By following these few tips on how to safely buy products from Alibaba, you can have a better understanding of how to properly search for suppliers that will help you with your needs. Keep in mind to always take the time to thoroughly research suppliers, negotiate prices, and monitor your order when you buy on Alibaba to get the best deal for all your sourcing needs.
Frequently Asked Questions
How can I be sure a supplier on Alibaba is legitimate?
Make use of Alibaba’s tools to help assess supplier credibility. Look for Gold Suppliers, Verified Suppliers with third-party inspections, and those enrolled in Trade Assurance, which offers financial protection for buyers.
What additional research should I do on a potential supplier?
Beyond Alibaba's verification methods, conduct your own due diligence. Search online for reviews and complaints about the supplier. Verify their business registration and address. Consider requesting a sample of their product before placing a large order.
What are some red flags to watch out for when choosing a supplier?
One of the most common but overlooked red flags are unrealistically low prices! Always remember that if the deal seems to good to be true, then it probably is. Another red flag to watch out for is if the supplier is unwilling to provide samples. A good supplier will be comfortable with providing samples. Lastly, be wary of suppliers pressuring you to pay upfront or outside of Alibaba’s secure payment options.
Is it safe to pay for goods upfront on Alibaba?
We highly recommend using Alibaba's secure payment options as this will hold your payment while your order is being processed and delivered. Payments will only be released to the supplier once both the buyer and seller has confirmed that the transaction is complete. Avoid wire transfers or payments outside the platform as this does not have any safety guarantee.
