The Chinese e-commerce industry is larger than ever. It’s on the rise and more than half of all the drop-shipping businesses across the World use Chinese suppliers.
The biggest names that come up when talking about dropshipping suppliers is Alibaba and Aliexpress. Both sites are owned by the same parent company.
Alibaba is a wholesale ecommerce website where you connect with suppliers to order products in bulk while Aliexpress les you buy single products.
Most of our group members have been asking is Alibaba safe or not? This often comes up when people haven’t dealt with the service.
When you are looking to sell bulk of the products then it’s much cheaper to order it from Alibaba. However, keep in mind that Alibaba has numerous suppliers.
So, it’s all about doing your research and finding the most reliable suppliers that can meet your requirements and satisfy them.
The process for finding reliable suppliers on Alibaba is a daunting one. It’s about trial and error on a larger scale.
Is Alibaba safe and legit?
Short answer, Yes! Alibaba is absolutely safe and legit.
Long answer, it depends on who you are dealing with and how you are paying for it. Alibaba as a company is trusted and reputable.
They have strict rules and regulations that keep most of the transactions secure on the platform. However, Alibaba is just an ecommerce platform that connects suppliers with buyers.
It’s all up to the buyer and supplier to do their due diligence when dealing with each other. Alibaba does intervene when their has been any misuse of the service, but it’s better to do your research before carrying out any transactions.
When you look at the suppliers, their previous feedback, number of transactions, etc you will have an understanding if the suppliers are trustworthy or not.
Testing a sample product or a few before making a full-fledged order is always the best way to go to see if the supplier meets our quality standards.
If you carry out these research and testing steps for each supplier then Alibaba can be very safe and legit for you. Best way is to always opt for the safest payment methods such as escrow, Credit card, QIWI, WebMoney, PayPal (Not officially supported by Alibaba), etc.
AliBaba doesn’t officially support PayPal, but you can come to terms with an individual supplier to accept it. Paying as “Goods and Services” via PayPal will bring you under PayPal’s buyer protection which is very safe.
However, it’s safer to choose one of Alibaba’s supported payment methods so in case of any mishap, Alibaba can intervene and help you out with your issues.
How To Verify Suppliers on Alibaba
Alibaba is full of suppliers. Good, bad, ugly, and outright scammers. Even though Alibaba has done a great effort of removing/blocking scammers from the platform, there can still be some lurking around to scam you out of your hard earned money.
It’s always a great idea to vet your suppliers very strictly before you get into any kind of deals with them. Here are a few tip to help you verify suppliers on Alibaba.
1. Alibaba Verification
Alibaba already has a great verification method in place for all the suppliers on the platform. This verification system often shows you how trustworthy a given supplier is.
The verification of supplier on Alibaba works as a safeguard for buyers by ensuring suppliers are legally registered businesses.
Inspections and audits of the businesses are carried out by both Alibaba itself and/or independent auditing/verification companies.
So, it’s always great to do business with Gold suppliers as they are often the most reliable ones available on the platform. Check out this chart explaining different verification levels by Alibaba.
As you can see, each level comes with more checks and verification that ensure that a business is entirely legit with facilities and everything.
2. Ask Questions
It’s always a great way to learn more about the suppliers you want to deal with. Ask questions. Ask them about their business, their company standards, products, facilities, ask them for photos, etc.
If you are unsure about anything then it’s best to ask directly. Check their responses for any signs of fraud or scam. Make sure that all your questions are answered in a satisfactory manner before proceeding any further.
3. Check Samples
This should be a no-brainer. No matter where you are dealing and who you are dealing with, it’s always important to check the samples before committing to anything.
You don’t have to worry about scammers only, sometimes a reputable supplier can be as bad in terms of product quality.
So, you should always ask them to send you a sample or two of the products you are interested in and check them for any faults or defects.
You can even ask multiple suppliers for the same product samples and compare them to see which one suits your needs the most.
4. Check The Suppliers’ Feedback
Each supplier has feedback and ratings from other buyers that can explain a great deal when making your decision.
Since, these are ratings and reviews from actual buyers you can learn a lot about how the supplier works, what quality they offer, etc.
Always check different reviews and overall supplier ratings to gauge the supplier’s reputation in the market.
5. If it’s too good to be true…
Well, it most definitely applies here. If some supplier on Alibaba is offering you a deal that you can only dream of then there’s something fishy going on.
If someone offers you a luxury item for pennies then you better know they are trying to rip you off and steer clear of them.
No one can afford to sell high-end items at a loss, so the chances are higher that they are just trying to scam you out of your money.
Always be vigilant when approached by random suppliers with unbelievable offers.
Secure Payment Methods for Alibaba
Most people ask if it’s safe to buy from Alibaba? If it’s safe to pay with credit card on Alibaba? Well, it all depends on the supplier, but Alibaba does have introduced secure payment methods.
You can opt for the secure payment available on Alibaba that offers some guarantee that you will receive what you want or get a refund.
Alibaba offers Trade Assurance that ensures if the products are not shipped or not in a satisfactory condition upon receipt, you get your money back.
However, not all suppliers support trade assurance so it can get tricky when you are not dealing with someone who supports trade assurance.
There are still safer payment options you can opt for to make the transactions secure. Check out our ratings for different payment options available on Alibaba.
1. Secure Payment (formerly Escrow)
Security: 5 out of 5
Alibaba uses AliPay to process credit/debit cards. Secure Payment is one of the safest payment methods available on Alibaba as it prioritises buyer satisfaction.
If you make a payment using Secure Payment, Alibaba keeps your money in escrow until the products are delivered and you release the payment.
If there is any problem with the products, if you don’t receive the products, or anything that’s deemed as the supplier’s fault gives you the ability to dispute the payment.
Alibaba will then look into the matter and refund your money when the seller is found to be at fault. This is definitely the most suitable and recommended payment method for buyers.
2. T/T Upfront Bank Transfer
Security: 1 out of 5
One of the highly insecure payment methods for the buyer. Don’t use this unless you trust the supplier completely.
This payment method makes you send the supplier a direct wire transfer with 100% of the order cost upfront before the production even starts.
There are high chances that you will lose your money to a scammer, so just steer clear of this payment method unless you are sure about the supplier’s reputation and trust them with your money.
3. Western Union
Security: 0 out of 5
This has to be the most insecure payment method available for any transaction anywhere in the world.
Never ever use Western Union because there’s no way of recovering your money at all. Even if you trust the suppliers, you should ask them to use some other payment method that offers at least somewhat of buyer protection.
Western Union should only be used when the supplier is part of your family, even then we’d recommend something else like PayPal.
Western Union is great for sending money to your loved ones, but it’s bad for business.
Security: 4 out of 5
Not officially supported by Alibaba, but PayPal still provides a safer payment gateway for the buyer.
Some suppliers do accept PayPal payments outside of Alibaba and you can often ask them to do so.
When you send money via PayPal “Goods and services” option, you come under PayPal’s buyer protection program which is very secure.
If there are any problems with your order or ordered products then PayPal ensures that you get your money back as smoothly and quickly as possible.
5. Letter of Credit
Security: 4 out of 5
Letter of Credit is quite safe for both the parties involved in the transaction. However, it has quite complex procedures that might deter the parties away.
It’s often the best choice when the purchases are of higher value than $20,000. At that time, the letter of credit helps both parties easily move forward with the transaction.
How to Approach Alibaba Suppliers
Now, that you know how to validate suppliers on Alibaba and which payment methods to opt for when dealing with them.
It’s now time for you to learn how you can approach them and make it simple so everything is clear for both the parties.
Here are some of the important questions to consider for your email:
Ask about Minimum Order Quantities (MOQs)
Even though most of the listing will have the MOQs listed, but there’s no pain in asking for a lower MOQ from the supplier.
You can ask them to provide you with a lower MOQ so you can buy a smaller batch of products that serves both as a purchase and sample.
Most overseas suppliers on Alibaba will often agree upon giving you lower MOQ if you are genuinely interested.
Negotiate Pricing For Samples
You already know how important samples really are. Samples can be the make or break point when it comes to choosing suppliers.
So, always get a sample beforehand. Some suppliers will ask you to pay the full price for a sample, but you can negotiate.
You can often ask the suppliers to give you a discount on the samples so you can check the quality of the product without paying the full price for the product.
Some suppliers on Alibaba are so confident about their product quality that they might even send you free samples, but this rarely happens since there are many abusers.
Ask about Production Pricing
One of the most important questions you can ask the suppliers is how much each unit will cost to manufacture.
Most of the times suppliers on Alibaba will give you a range like $4-$5 per unit, but you will often require the exact amount each unit will cost you so you can understand and plan your margins accordingly.
Learn about Production Time
It’s always very important to know when your items will be manufactured and how long it will take them to do so.
Ask them to give you exact dates of production so you know when you can actually deliver these products to your customers.
There’s one more thing that most people have been scouring the internet for. Many investment enthusiasts have been asking if it is safe to invest in Alibaba stock?
Well, Alibaba holdings is a trusted company with huge value in the stock market. It’s often a great idea to invest in ecommerce businesses ass these can quickly multiply your investments.
However, we are not an investment advisors so do your own research when building a financial portfolio and only invest in businesses you are 100% sure about.
How to buy from Alibaba without a company?
You can buy products from Alibaba even if you don’t own a company. When registering an account on the website, just put your name in the company field.
Most of the suppliers on Alibaba are trading companies and manufacturers that mostly deal in bulk orders. So, mostly the preferred buyers are businesses that can order higher quantities. However, even if you don’t have a business or don’t want to buy large quantities then you can contact the suppliers that offer goods in low MOQs.
Can you buy single items from Alibaba?
Normally, you can’t buy single items on Alibaba because it’s a wholesale platform where sellers/suppliers prefer to sell in bulk. However, there are ways you can purchase single products. This requires you to do one of the following.
- Ask the supplier/seller for a sample of the product, most of the suppliers will gladly provide you with a single sample.
- Find smaller suppliers and ask them to sell you a single product. They will often do it for a competitive price.
- has a competitive wholesale market where most of the buyers sell stuff for a smaller quantity. If a supplier has MOQ as 1 then you can just directly buy it from them
If you have been on the fence regarding making a purchase from Alibaba then we hope this article clears up most of the questions that you might have.
As already mentioned, it’s always a great idea to do your own research because each supplier is different from the others.
It’s recommended to do your due diligence and validate each supplier that you want to do business with.
Sourcing a great reputable supplier is an entirely challenging task, but once you narrow down to a few it can prove to be the most profitable thing for your business.
Never be afraid to walk away from anything and anyone that sounds shady, no matter how tempting it sounds. There are thousands of other suppliers on Alibaba.