2020 Buying on Alibaba Guide: Price Negotiation, Payment, & Shipping

May 2, 2020 in Blog, Buying Products, Chinese Importing, Finding Suppliers
2020 Buying on Alibaba Guide:
Price Negotiation, Payment, & Shipping

2020 Buying on Alibaba Guide: Price Negotiation, Payment, & Shipping

Alibaba is the place to go when looking for suppliers to buy private label products in China from. Using Alibaba, on the surface, seems relatively straight forward. But how do you find reliable suppliers, negotiate with them, and get your products shipped? In this article, we’ll cover all of these things.

In this article we will not cover how to find great products to import from China. If you’re looking for products to import, I recommend you check out the article below.

What is Alibaba? Alibaba.com vs AliExpress vs Alibaba Group

Alibaba.com is essentially a directory of Chinese factories and trading companies in China. It is the resource for finding suppliers in China and in fact even Chinese companies use it.

Alibaba Group (founded by Jack Ma) though is a massive conglomerate of different web properties including Alibaba.com, Aliexpress (a website for foreigners to buy products from China) and Taobao (China’s version of Amazon). Of all of Alibaba Group’s different properties though only Alibaba.com is of relevance for importers (some ecommerce sellers use Aliexpress because it allows ordering of low quantities but the prices are very high).

Can You Drop Ship from Alibaba?

Most suppliers on Alibaba want you to purchase a Minimum Order Quantity (MOQ) of at least $500 or more.

Therefore Alibaba is not very good for drop shippers.

If you want to drop ship it is better to use Alibaba’s sister site, AliExpress.

You can also check out our article on how we use AliExpress to validate products before launching them on Amazon.

Is Alibaba Safe?

The question I probably hear the most about Alibaba is, “Is Alibaba safe to use?”.  The answer is that yes, Alibaba is safe to use but with one caveat regarding quality (which I’ll get to in a second). If you order from Alibaba, as long as you follow some normal precautions you will almost certainly always receive your products. In nearly ten years of using Alibaba I have orders millions of dollars worth of products from dozens of suppliers and I’ve never been scammed. Some basic precautions to follow:

  • Order from Chinese companies only
  • Buy from Gold Suppliers only
  • Making payment via wire transfers for larger orders is normal but always make sure the beneficiary name matches the company name
  • Order small at first and gradually increase your order size

If you follow these basic guidelines you will almost certainly not be scammed.

Now, the caveat I mentioned regarding quality. Receiving inferior quality products in China are a very big concern when ordering on Alibaba. Stereotypes are sometimes true, and the crappy “Made In China” products stereotype can be true if you do not follow some fairly easy best practices. When you’re reading to order products, review our article below on ensuring quality products.

Related reading: How to do a Quality Inspection and Why You Need One

Types of Suppliers on Alibaba

On Alibaba there are two types of suppliers, Gold Suppliers and non-Gold suppliers.

A Gold supplier pays a premium for increased ranking, marketing services, etc. and Alibaba does some limited identify verification of these suppliers. A Gold Supplier on Alibaba does not mean this Supplier has good quality products but it does give some indication this supplier is a legitimate and invested seller.

alibaba free vs gold suppliers

I personally try to work only with Gold Suppliers simply as a filter mechanism but remember that a Gold Supplier does not mean they are an excellent supplier. 

Alibaba is also open to both Chinese companies and non-Chinese companies, although Chinese suppliers make up the vast majority of suppliers. suppliers can also come in the form of trading companies and factories

A trading company does not manufacture the products they produce and generally have slightly higher prices but also slightly more consistent quality and a larger product selection. Factories have slightly lower prices and more limited selection and more unpredictable quality. Neither are good nor bad inherently but know the differences between these types of Suppliers.

How to Find Great Suppliers on Alibaba

Once you know what product you want to search for on Alibaba go ahead and search for the product. Your ultimate goal when looking for suppliers should be to find 3-5 potential suppliers, contact them, and get price quotes for your product.

The first thing I do when starting a search is to have my results sorted by supplier, not by product (which Alibaba will do by default) otherwise the top search results will be dominated by one or two suppliers. See the image below.

You should sort by Suppliers, not by Products, when searching on Alibaba

You want to look for suppliers who have products similar to what you’re looking for. Keep in mind, many suppliers simply steal photos of Western brand’s products. I like to look for signs that the photographs are authentic, such as:

  • Signs the photo was taken in China (i.e. Chinese people or writing in the photograph)
  • Company watermark on the photo
  • Good photos but not too good (most suppliers don’t take ‘retail’ quality photographs)

How to Contact Suppliers on Alibaba

Suppliers on Alibaba can be very picky with what buyers they choose to work with.

You will see on the search  results page the Supplier Response Rate. You will almost always see that this Response Rate is far lower than 100%. Alibaba suppliers will often simply ignore many buyer requests.

alibaba response rate

This supplier only responds to 77% of inquiries they get.

For a lot of Chinese suppliers, Alibaba is a lot like using an internet dating website. A supplier with a great profile page and selling high demand products, a.k.a. the proverbial hot girl, may get dozens or hundreds of inquiries a day. And just like internet dating, not all of these inquiries lead to dates, or in our case, orders. Therefore, Chinese suppliers are selective in who they respond to and even more selective in who they give their best prices to.

There are several ways to increase the likelihood a supplier responds to you:

  • Do you know exactly what products you’re looking for?  Or are you fishing for an entire catalog and price list?
  • Are you clear, concise, and to the point? Or does your supplier have to put a lot of thought into answering your email, which is especially hard for a non-native English speaker?
  • What country are you from? Certain countries are more desirable for a supplier to do business in such as countries the supplier doesn’t currently do business in. Your supplier can see what country you are emailing from via Alibaba.
  • Are you a big buyer with brick and mortar stores?

In my first email, I aim to ask only a couple of questions about a product, specifically the price and maybe a simple product specifications question. Do not overwhelm them with a lot of questions in your first email. Also remember English is a second language for suppliers and each response from them takes a lot of time.

I also ask them for the WeChat ID – almost everyone now in China prefers to communicate over WeChat over email or other means. If you’re serious about importing from China download WeChat for your phone immediately (it’s free).

The Great Firewall

wechat-logo

Chinese censorship is prevalent and can affect your emails from getting through.

The Great Firewall blocks access to common services like Google (including Gmail), Whatsapp, Facebook, and Dropbox. Avoid using any links to these services.

Also, Chinese internet is very slow and large attachments can take a very long time to download.

Given the unpredictability of email, it is best to use WeChat whenever possible.

Sample email to Supplier

Dear Shanghai Saddlery Co., Ltd.,

I am from Chinese Importing Products Inc. We are based in Vancouver, Canada and we are a retailer/wholesaler of Horse Saddles. We are very interested in the Horse Saddles your company offers.

Can you please tell me the price on your Adjustable Leather English Horse Saddles, Mode SA138, as shown here: http://shanghaisaddlery.en.alibaba.com/product/736255569-214759027/adjustable_gullet_english_leather_saddle.html

Also, what is your WeChat ID?

Sincerely,
David Bryant

 My goal is just to get a response. I avoid mentioning MOQs which may scare off a supplier. It’s easy for a supplier to simply ignore an initial email. But once a supplier has actually responded to you, it’s difficult to ignore future emails. If they add you to WeChat it’s almost impossible for them to ignore you.

How to Negotiate with Alibaba Suppliers

The key to negotiating with suppliers is to determine the market price of your desired product.

Unless you know your product extremely well and the cost to manufacture it (VERY few people know this) your absolute only way to know the fair price of your product is to receive competing offers which is why we’ve contacted several suppliers.

You should at this point start to receive prices from your suppliers. If they ask you how much you will be importing let them know your ideal annual order amount (be an optimist but don’t promise the moon) rather than individual order amount.

Supplier Analysis

Tabulate the prices of at least five Suppliers into a spreadsheet

The chances are good that you will receive very comparable prices, i.e. ranging from $28.40-$36.40. Chinese suppliers are very good at knowing how much their competitors are charging and therefore will price themselves competitively, especially if they want to do business with you. Record each supplier’s price, MOQ, and shipment terms either in a spreadsheet like here or other simple word processing document. It might seem trivial, but it forces you to compare each supplier equally.

Beware of suppliers that have very low prices relative to others. Normally there is a catch. Typical catches include:

  • Shipment terms are EXW opposed to FOB (much more expensive)
  • The material is of a much lower quality, i.e. 150 denier fabric instead of 600 denier Fabric
  • They only accept extremely large orders

Once you are comparing apples to apples, i.e. you know each supplier is quoting a product constructed of similar materials and with similar shipment terms, then ask the other suppliers if they can match the price of the lowest offer. There’s a temptation to lie and say “Your competitor Ningbo Saddles offered me these saddles for $24” when in fact they offered them to you for $34. Your supplier will smell you out and you’ll lose credibility. There is not as much room for price negotiation in China as there was previously. A 10% price discount is often huge.

At this point you will likely have two or three suppliers with comparable prices and comparable products. At this point, you want to find a supplier that can accommodate your smaller order size.

Shipment Terms: What’s the Difference Between EXW, FOB, and CIF?

As you’re getting quotes, pay careful attention to the shipment terms. These are especially important if you’re shipping your items via sea freight.

There are three common shipment terms which essentially determine who pays for shipping:

  • EXW (Most Expensive for You): You have to pay for the cost of freight directly from your supplier’s factory to your desired destination. Essentially you’re paying the cost of Chinese Land Transportation and Sea Freight.
  • FOB (Most Common): Your supplier will pay for shipping from their factory to the closest Chinese port. You will pay for the sea freight but your supplier will pay for the inland transportation in China.
  • CIF (Least Expensive for You): Your supplier pays for the cost of Chinese inland transportation and Sea Freight to your desired port.

Read more on our article All About Shipment Terms.

How to Negotiate Low Minimum Order Quantities (MOQ)

Minimum Order Quantities (MOQ) is one of the most important issues you’re going to face when first dealing with Suppliers.

Suppliers have MOQs for normally two reasons:

  • They mass produce the product, and keep stock of it, but it’s not worth their expense to ship a small number of products
  • They only produce the product on demand therefore they need a big enough order to warrant a production run

If an item is customized or a very niche product that your supplier does not keep stock of then it is very difficult to negotiate MOQs as your supplier will lose money (not just time) for small orders.

injection mould

If your product requires any custom moulds or other customization, MOQs are much less flexible than if you’re importing an off-the-shelf product

If you’re dealing with a popular product and/or dealing with a trading company then in these cases small orders are just not worth their time.  Maybe they can sell me ten horse saddles and still make $100 profit, but they have higher priorities.

In these cases, all you need to do is decrease their cost of time. Assume you have narrowed down your selection process to one or two suppliers and both insist their MOQ is fifty units but you only want ten units. The following email will get your supplier to accept your order more often than not:

Dear Shanghai Saddlery Co., Ltd.,

I understand your MOQ requirements but we would like to purchase 10 saddles initially to introduce to our customers and proceed with a larger shipment on the next order.

If you can understand our needs, please see the attached PO for 1o units of SA138. Please confirm with a copy of your invoice which includes FedEx shipping charges to Vancouver, Canada. Also please include your banking information and I will wire 100% payment to you tomorrow. 

Thank you and I look forward to working with you on many future orders,

David Bryant

Very few suppliers can say no to having money wired to them in full.

Note that when you do this strategy, you have very little room for negotiation. The second you start to try to negotiate price, payment terms, etc. you’re imposing a money cost and time cost on your supplier.

If you have Jungle Scout you can see exactly how much your supplier exports to America by looking at their export history (in America, import/export records are public information meaning anyone can see this info).

For example, by searching for Shanghai Saddlery company, we can see that in the past, they did an order to Blocker Ranch Inc. for just 41 units. This is a good indication they would likely accept an order from us for around 41 units (or much less).

Using Import Records to Find & Vet Suppliers and Snoop Competitors

One of the best things an importer can do is to use import records to help them find products to import and vet suppliers.

jungle scout supplier database

Jungle Scout allows you to see the real export history of nearly any Chinese Supplier.

As mentioned, in America, import and export records are public information, however, the government does not catalog or give easy access to this information. However, there are tools which do allow you to easily search this information, the most popular and cheapest being Jungle Scout (others include Import Genius and Panjiva).

These tools allow you to:

  • Find out what Chinese supplier a competitor is using (great for finding products)
  • See how much a supplier exports
  • Find out what suppliers export specific products

See our article A Secret Weapon for Doing Supplier Research

How to Order from Alibaba and Make Payment

Once you’ve picked a supplier and they’ve agreed to send your desired quantity you’re ready to pay for and ship your order.

Make sure to ask for any promised sample cost refunds on your first real order – your supplier won’t give them if you don’t ask.

Keep in mind that some suppliers may not charge you for the cost of one sample but they will almost certainly get you to pay the cost of freight. They will almost certainly charge you for any samples beyond one and the cost freight. Do not try to negotiate this- it makes you look really small. However, most suppliers will promise to pay you back this sample and freight cost on your first real order.

Most suppliers will send you something called a proforma invoice which is just a fancy word for an invoice.

If your order is smaller (under $5000 or so) use Alibaba’s Trade Assurance. This will more or less guarantee your items are shipped but will not give you quality guarantees (despite what Alibaba claims). Once your orders get larger, most suppliers will expect a 30% deposit via wire transfer and the remaining 70% payment when the goods are ready. Suppliers don’t typically like PayPal unless it’s for sample costs.

Order Several Samples Instead of One Sample

golden sample

Your first sample will normally be the best quality product you will receive.

Many books and websites say that you should always order a single sample from a supplier and inspect it for quality et al. There’s some problems with doing it this way:

  • Your first sample is guaranteed to be of good quality. i.e. you will get the “Golden Sample”
  • The freight costs to get a single sample is outrageously high
  • One sample gives you no chance to try and sell the item on eBay, Amazon, etc.

Therefore, I always recommend people to order at least 10 of an item if possible at first. At the very least, this gives you a chance to sell the items on eBay or Amazon. If you import one sample and sell it the very first day on Amazon you may have simply lucked out. Selling ten is a far better sample size.

How to Ship Your Products from China

If this is your first time ordering from China it’s often best just to ask your supplier to arrange for shipping and to add the charges to the invoice.

If everything is being shipped via air, then there’s really no surprises. Simply tell your supplier your address. They will likely ship it via DHL, FedEx, or UPS. If your goods are being shipped to the U.S. and are valued at under $800 then there will be no duty charged because of America’s very generous de minimis rules.

Generally speaking, items under 200 lbs or so should go via air courier (i.e. UPS/DHL/FedEx/etc.). Expect to pay anywhere from $6-15 per pound. When larger than this, air freight and sea freight become more cost-effective but also more complicated. Check out our article below.

If you’re shipping your products to Amazon FBA warehouses then check out our article How to Ship Your Goods from China to Amazon FBA.

Why is Shipping from Alibaba and China So Expensive?

Shipping items from China overall can be very expensive due to the distance.

If an item is under 5-10 lbs it can actually be shipped for quite cheap from China but very slowly using something called  ePacket.

If your item is heavier then normally you can expect to pay around $10-20 per pound with a minimum of $75 or so.

If you are shipping hundreds of pounds of products it is normally best to ship via something called Air Freight or Sea Freight. See our article How to Ship Your Goods from China via Sea Freight and Air Freight

How to Review Your Shipment for Problems

If you’ve had your order shipped via air, then it should arrive in anywhere from 3-10 business days. If via sea, this will be more like 30-45 days. When your shipment arrives, here are some things to inspect, which may be talking points for future orders:

  • Quality. Is the product the quality you expect? Use and abuse the product for a bit of time. Does it hold up how it should? If not, remember that you’ve likely received their best quality samples and quality is only expected to be the same or decrease on future orders.
  • Packaging: Is the packaging sufficient to ship to your customer? Or was everything lumped into one box and you need to purchase all new shipping boxes? (if so, request your items to be boxed on future orders)
  • Instructions. Did it come with instructions (if applicable)? If not, does your supplier have instructions? If not, you should start creating or borrowing some and include them with your product.
  • Made in China? Does your item have “Made in China” marked somewhere on the box? If not, you should request this on the next order

Once you’ve received your order, you should email your supplier to let them know that you received everything but you have not had a chance to review the products yet and let them know that you will contact them shortly to discuss things and to hopefully make another order.  There’s no rush to do the above- just like in dating, playing hard is sometimes a good strategy.

Alternatives to Alibaba

There are several alternatives to Alibaba that exist, although none are anywhere near as exhaustive as Alibaba. Some of these alternatives include:

  • 1688: This is the Chinese-only wholesale version of Alibaba for Chinese buyers. Use Google Translate.
  • Global Sources: Not as exhaustive as Alibaba and has more Hong Kong trading companies. However, the quality of supplier skews higher.
  • Aliexpress: If you want a small number of products, Aliexpress is a good option although you’ll pay slightly higher prices.

Conclusion

This covers most of the basics of using Alibaba to find suppliers and Products. If you want a more in-depth guide to starting an import and private label business I strongly suggest you check out our mega guide on How to Import from China.

Do you think Alibaba is still a good place to find suppliers? Let me know below or share any other questions you have about buying from Alibaba.

  • About The Author: Dave Bryant

    Dave Bryant has been importing from China for over 10 years and has started numerous product brands. He sold his multi-million dollar ecommerce business in 2016 and create another 7-figure business within 18 months. He's also a former Amazon warehouse employee of one week.

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73 Comments

  • Adriana
    August 15, 2015 Reply

    Great blog and a lot of useful information.

    How do you handle the case where the supplier cannot give you more than 1 sample ?

    Looking forward for you next post

    • David Bryant
      August 15, 2015 Reply

      Hi,

      Are you asking for paid samples or free samples? In the rare cases they refuse to give more than 1 paid sample, just about the only thing you can do is to import the 1 sample and then do a larger order with their MOQ or find another Supplier who will be more accommodating (normally a trading company).

      • Adriana
        August 15, 2015 Reply

        Hi

        I am asking for 1 paid sample which they quoted it in RMB at a price 5 times bigger than an order of 1000 MOQ.

        Thanks

        • David Bryant
          August 17, 2015 Reply

          Hi,

          So they said, for example, 1 sample is $500 or if you order 1000 pieces, it is $100 each? Am I correct to assume that it is a higher ticket item? ($100+?)

          Some suppliers have been known to do this in cases where consumers may just want to buy a one-off item for personal use and have no legitimate commercial interest in the product. You can ask to have the sample cost paid back on your order over 1000 pieces, which I'm sure they'll oblige to. You're definitely going to pay more for 1 piece than 1000 pieces, although 5x seems as a little high (I've personally paid around 2.5x more for one sample though)

  • Ivan
    September 6, 2015 Reply

    Thanks David, this info is golden!

  • Dante
    October 7, 2015 Reply

    Hi i had read many email template and i try to come up with my own version of template which combine all the things that i read. Would you kindly tell me what need to fix or remove from these. because i dont want to appear un professional toward the supplier.

    Hello,

    My name is _ from _ We are in the process of adding a _ to our product line and your product seems to be what we are looking for.

    I have a few questions.

    1. Do you offer samples and how long to receive 5 - 10 samples to Shenzen?
    2. Can we pay using Paypal and do you accept Escrow payments?
    3. Can we make a minor change to the products like the color. shape and size?
    4. Can we brand with our logo?
    5. Can you do custom packaging?
    6. What is the cost of 500 - 1000 unit including shipping by DHL Air Express to United States?
    7. How long for manufacturing once we place order?
    8. Do you do label print and are you able to put the label and logo on the packaging?
    9. Can we order 500 units for the first order?

    Our first order of 500 unit will be a small test order and in the future will be ordering between 1,000 to 5,000 units. We are hoping the samples are up to our customer's
    expectations and quality standards. If we can begin ordering at least a few thousand per month minimum.

    We are looking forward to hearing from you soon.
    Thank You!

    Name
    Company

    • David Bryant
      October 10, 2015 Reply

      Hi Dante,

      These are a lot of good questions to ask, but not in your first email. Your first email should be short and sweet, "I'm interested in this product, can you give me more details including price and MOQ". Suppliers can get dozens of emails a day and they're lucky if 1 of those emails results in a sale. Subsequently, they can't spend an hour answering each email, so they may ignore a long email like this (which they rightly assume is a form email that you're probably sending to a lot of Suppliers). Also, keep in mind, the Chinese HATE to say no. Your answer to many of these questions will almost certainly be 'yes' which doesn't mean anything ("Sure, you can change the shape and size, if you order 100,000 units"). IMO, you need to get really specific on many of these questions, and you can get to that level of specificity until later in negotiations. For example, what do you mean branding with your own logo? Do you know want your logo on the actual mold and imprinted on the product? Do you want their full color stock packaging to incorporate your logo? Or do you simply want a sticker of your logo applied to the product?

  • Alex
    November 17, 2015 Reply

    Hi David,

    Once again thanks for your information.

    If I'm looking for a custom designed product, should I request a sample of the similar product or should I wait until they customized the product and ask for around 10 samples?

    Cheers,
    Alexander Tee

    • David Bryant
      November 17, 2015 Reply

      Hi Alex,

      It depends how customized you're getting. If you're changing the color, sure, one sample of a similar product and then a few of the finished product works. If it's a completely new product with a custom mould, CAD designs, etc. you're probably going to have several sample iterations from start to finish. There's a really good podcast here: http://www.ecommercefuel.com/product-manufacturing-process/

  • Vin
    March 10, 2016 Reply

    Hello David

    Thank you for sharing your insight. I wanted to ask for your advice. When is the right time to negotiate the price for my first commercial bulk order? Right before I buy their sample or right after I received their product sample?. I have found a supplier in China thru Aliexpress who can do private label on the product for a much lower MOQ vs Alibaba. $17 is the listed price on Aliexpress and the sample is $35 excluding shipping. I have not given a go signal yet to buy their sample.

    • David Bryant
      March 10, 2016 Reply

      Hi Vin,

      I'd definitely wait until after you receive the sample. Once you've paid for and received a sample it indicates a lot more seriousness by you and they'll in turn negotiate more seriously :)

  • ind
    March 11, 2016 Reply

    Hi, I am actually researching to buy a laser cutting/engraving industrial machinery. I have seen similar products with a huge variant of price range. Most of the product has MOQ of 1 so it is different to the products mentions in this site. But it has price range listed in the Alibaba.com site. So my question is for this kind of product, can you negotiate below the quoted price range?

    • David Bryant
      March 11, 2016 Reply

      Hi,

      Of course you can, especially seeing it's a relatively high ticket item. For something like this, a 10% discount might be huge though.

      • ind
        March 14, 2016 Reply

        Thanks for the reply David. I've tried to contact some of the company and gotten some of the response. And I noticed that the company name is not clearly specified although with some effort you could figure out what the company is. So I wonder if it to prevent buyer going directly to the seller bypassing Alibaba. Do you have any idea on this? Is there any advantage for buying through Alibaba site warranty or something like that?

        And I purchase a smaller ticket item, a plot cutter, for my brother in the past in Guangzhou. I didn't research the product but I was in town, so through several sources I check out a couple of local source. My experience was that some of the similarly priced product has a lot of different features. The plot cutter that I finally bought was capable of handling 30%-50% wider material, come with a stand and look newer & stronger than the next best offer which was similarly priced. So I think there can be a lot of variance in product quality. It seems to me that sometimes pricing depend on how aggressively your seller is doing. And for the product I am currently looking for there seems to be a lot more possible variance of feature. I am not sure of what is the general strategy here. Any tips?

        • David Bryant
          March 15, 2016 Reply

          Hi,

          There's no advantage/disadvantage to the seller bypassing Alibaba. Alibaba charges a flat annual fee to sellers, not a commission so they don't care if a buyer contacts a seller outside of Alibaba. Is it a Gold Supplier who has the ambiguous name?

          Like any country, some sellers may price their product more aggressively than others but more often than not, everyone is similarly priced. 20% variance between Suppliers is normal I would say, but 50% seems like a lot. You want to be sure you're comparing apples to apples though (if two machines have different features, even if the differences are small, it makes it difficult to compare prices).

          • ind
            March 15, 2016

            Hi,

            I think it is a Gold Supplier. On the company profile tab the name of the company is not written, just it's company type and location. I had to ogle the image for the brand to find out the company name.

            It seems that there is actually certain standard for each competitive price point and some seller is trying to pass their product at higher price point. I wanted to inspect the product if I can to try to get the best product at an affordable price point. Next week, I am planning to go to Guangzhou so I thought of looking for the stuff along the way. However most of the product's company so far is located in Shandong which is pretty far away. I have to check out for stuff at a closer distance from Guangzhou if I can. Yet I am not sure how to do this with Alibaba site. If their headquarter in Shandong, it is difficult to find out if they have a showroom in Guangzhou using Alibaba site. I am not sure if the port can usually be used a guideline as mostly are in Qingdao, Shanghai and Guangzhou; I could probably fly to Shanghai or try the express 6 hours train. Also for now I am not sure if it is necessary to look all the way to Shandong or simply check around Guangzhou.

  • Sofia
    April 5, 2016 Reply

    Hi David,
    Great website you've got here, lots of very useful info! I'm a newbie to importing and have just started to find my way around Alibaba. I have a question about the "Business Identity' on there...how important is it that it gets verified before I contact potential suppliers? Will they take me less serious if my business profile is 'unclear'? And does the same go for my member profile? (not sure what the difference is actually...?) Should I upload a personal photo and my address details etc to the website or does it not really matter? I'm a little hesitant to put all my personal information out there if I'm not sure who I'll be dealing with yet... I have a name and logo for my business but it's not an official company on paper at the moment, can I still use the logo etc in my profile on Alibaba?
    Hope you can help me shed some light!
    thanks and best wishes, Sofia

    • David Bryant
      April 5, 2016 Reply

      You should be fairly selective with what informat ion you put up there. If you readily post your phone number chances are you'll have Suppliers calling you the next day :) If you're having difficulty getting responses, then you can start to add some more information.

      Every time someone messages a Supplier it shows the location of the buyer via their IP, so a Supplier can verify if you're from a 'good' country. So in other words, they'll likely look more at your country location than anything that you post in your profile.

  • Sofia
    April 5, 2016 Reply

    Hi, just an additional question after some more research today :-) : I have established a list of 7 potential suppliers now, of which 5 actually have their own websites. Is there any advantage in approaching them through their own website initially or best to go through ALibaba? Thanks :-)

    • David Bryant
      April 23, 2016 Reply

      Hi,
      There shouldn't be any advantage to going direct. ALibaba Suppliers pay a flat fee and not a commission, so they're prices should not be any lower or higher on either.

  • Terry
    July 4, 2016 Reply

    Hi, I am new to private labeling. I found a product which I would like to import from China but I have many questions regarding this and was hoping if someone could help me.

    1. I have contacted many suppliers and a trading company gave me best price rather than a manufacturing company. Is it okay to order from a trading company (with registered capital of RMB 30000 and 1 year gold supplier)?

    2. My supplier wants me to pay 50% of paypal handling fee. Should I accept this?

    3. If I pay the 30% of the order value before manufacturing then when should I pay the remaining?

    4.Should I ask for any certificates or some proof of warranty??

    5. Should there be a contract written for the current order ?

    6. I am planning to start with a small order. How to start the negotiation process for it?

    7. There is very little information about the product in Alibaba. Is that normal?

    Thank you.

    • David Bryant
      July 4, 2016 Reply

      Hi,

      1) Yes, nothing wrong with a trading company. Some people think you get a higher price from them, but this isn't always the case.

      2) What is the handling fee? Shipping fee? If so, then you're lucky they're only asking you to pay 50% and not 100%

      3) Once they send you a copy of the shipping documents.

      4) Sure, although none of it will really be enforceable.

      5) You don't necessarily need a formal written contract but you you need a document very clearly listing specifications et al. i.e. type of packaging? How are the items boxed? colors? instruction manuals? Shipping terms? (FOB?)

      6) Try and get a 10-20% discount. Might be tough for a small order though.

      7) It depends. Is it patented?

  • Mitch
    July 15, 2016 Reply

    Hi David,

    This was a really good post. I was wondering about the packaging. If you want your logo stickers on the packaging, how do you go about it? Are they able to produce the stickers and attach them if you supply them with the vector file?

    Thanks

    • David Bryant
      July 17, 2016 Reply

      Hi Mitch,

      Of course - it just comes at a price. Stickers are by far the cheapest and many will do it for free. Full color packaging you'll almost always pay for unless you order a very large quantity.

  • Lindsay
    September 1, 2016 Reply

    Hi David,
    Thanks for the wealth of information! I recently purchased your ebook too, what a great resource for my startup ecommerce business. One question I have, which I can't seem to find an answer for, being from Canada, do we need to have both english and french on the packaging? And on the instructions? Will the suppliers add both languages? Thanks!

    • David Bryant
      September 2, 2016 Reply

      I would expect your Supplier to add no instructions let alone translate them :) They might provide in English if you're lucky. The retail packaging laws in Canada are complex and I don't understand them completely - with that being said, from experience, it's not something Canada customs is aggressive about looking for. I could be wrong but I don't think they check for it at all - its regulated after import by another agency.

  • Rupesh
    January 28, 2017 Reply

    Hi David,

    Great Article!!
    I am new into this import business, I found the products, but how to make sure these products are in compliance with USA CPSA, CPC regulation. Lot of seller gave me certifications from EU standard, but no one is providing any certification related to USA regulation.
    Can you help me if there are any specific regulation which needs to be present during custom verification and I should be aware of if product is for kitchen or kids toy category, since most of products contains plastic parts.

    Thanks for your help

    • David Bryant
      January 30, 2017 Reply

      Hi Rupesh,

      Yes, it's quite common they have EU certification but not U.S. certification. I believe in the U.S./Canada there's a lot of onus on the importer and not just the manufacturer. Unfortunately I'm not confident enough on the regulations on certain products like toys to give you any advice.

  • Rachel
    February 17, 2017 Reply

    I am a new online retail store owner. I have selected a supplier in china. I have been advised that the supplier can drop ship directly to my customer. The supplier will charge me $16 for drop shipping to customer and $2 to process PayPal. Is this a good deal or not. Most of my product orders will be around $100 or more.

    Rachel

    • David Bryant
      February 18, 2017 Reply

      Only you can be the judge of this. Is it still profitable for you? If it is, then it would appear to be a good deal.

  • Melanie
    March 13, 2017 Reply

    Hi there

    This was really informative, Im new to this world and took away some really good stuff. One question - Is it normal practice for them to want to discuses the order over whatsapp? Almost all of the suppliers i have contacted have requested my number to talk on whatsapp? then pay through paypal. I have placed two orders this way and the packages are indeed on there way as i can see them via the tracking but this form of contact seems a little off?

    Thanks Mel

    • David Bryant
      March 14, 2017 Reply

      YES. Every Supplier wants to talk via Whatsapp or WeChat. I hate it - email keeps things much more organized, but that's just the way they do it.

  • Deepti
    September 5, 2017 Reply

    Hi David, I am from Toronto and new to online selling. I have identified a product and contacted several suppliers from Alibaba. However, I plan to buy a few samples from AliExpress as they have good product-specific reviews. Once I receive the samples, I will connect with the supplier for bulk. Is this the right way to approach.
    Also, AliExpress does not have PayPal option, what would be the safest payment mode?
    Pl. Guide

    • Dave Bryant
      September 10, 2017 Reply

      You can do it this way but the person on Aliexpress may not be the manufacturer and/or be able to offer a lot of discounts. I've never purchased through Aliexpress actually so I can't confirm what the best payment method is.

  • Nick
    October 1, 2017 Reply

    Hi Dave,

    My first Amazon order I did not have to deal with customs. Everything was smooth from China to FC. My Alibaba supplier handled everything. Is that called FOB?

    I am worried that there might be future misunderstandings and my product will get stuck somewhere in US or get rejected by Amazon due to customs.

    My second question is related to Amazon Canada. I am based in Vancouver - should I just ship it to me first and then ship it out to the warehouse (I think its in Surrey?)

    Thank you

    • Dave Bryant
      October 2, 2017 Reply

      If it shipped into Amazon directly from China that would be closer to CFR. Assuming it was going to the USA, your order was likely under $800 or your supplier undeclared the value on the invoice. Be careful if your value starts to exceed that $800 "de minimis" threshold and be aware that in Canada that $800 threshold is $20. Yes, if you're in Vancouver and shipping to Amazon.ca probably easiest to ship to you first although Amazon will very likely have you send the goods to their Ontario warehouses but you can use their cheap partnered carrier discounts.

  • Alejandra
    October 6, 2017 Reply

    Hi Dave,

    I am currently in the process of ordering 300 t-shirts from an alibaba supplier. They have offered a great price and samples. However, when I ask how much for shipping they tell me they cannot quote the shipping charge until they list the cargo. They have offered the PI but with no shipping cost. I am wondering if this is a normal thing or is this a scam? This is my first time purchase through alibaba.
    Thank you.

    • Dave Bryant
      October 7, 2017 Reply

      Hmm, scams are rare but it sounds odd. They should be able to ballpark a shipping charge - chances are there's some confusion somewhere in the line. If you get the dimensions and the weight you can estimate the shipping charges on your own.

  • Ms. Allen Ebora
    November 27, 2017 Reply

    Hi Dave. Thanks for this article. I really learned a lot. I have now selected my supplier and asked them to send me 3 invoices (PayPal, Western Union, and Bank Transfer) They are charging me an extra "handling fee" for Bank Transfer and Paypal. Is this normal? Thank you so much in advance.

    • Dave Bryant
      November 27, 2017 Reply

      Yes, fairly normal nowadays although it can be a point of negotiation.

  • g
    December 7, 2017 Reply

    why is the supplier contacting me through his personal email - not via alibaba? should I answer?

    • Dave Bryant
      December 9, 2017 Reply

      Not sure why they do it but it's not that unusual. Take the usual precautions though.

  • Mohamed Lateef wani
    December 10, 2017 Reply

    Nice info sir kindly tell tell me is the supplier listed on Ali baba aap reliable 2.is it good to pay 25dollar for samples via West union on the individuals name.

    • Dave Bryant
      December 12, 2017 Reply

      Too many variables in this question to answer it.

  • AJ
    February 8, 2018 Reply

    Hi Dave,

    I found my supplier through Alibaba and am using Trade Assurance for my initial order.

    I drafted a PO and the supplier agreed to the terms. I found after paying the 30% to get the order started, the supplier is less responsive and is not sticking to the terms (production run has exceeded agreed upon 30 days and the supplier is very non committal to providing a ready date).
    (And now they've shut down for Chinese NY!)

    Have you had a similar experience with a supplier not maintaining the terms of the agreement? Would you recommend complaining to Alibaba? What recourse is there?
    I'm starting to think the purchase order agreement is not worth the paper it was printed on..

    • Dave Bryant
      February 16, 2018 Reply

      The general rule is to take whatever delivery time your supplier gives and double it. You should have penalties written into your PO next time- when you ask for that they will probably quote a more reasonable delivery time of 45 days (30 days is very short and unrealistic). You're money is almost certainly safe but delays are the number one annoyance in manufacturing, especially in China.

  • DVA
    June 15, 2018 Reply

    Hi Dave, first, thanks for the blog post. While I've successfully ordered once through Alibaba, there's clearly a lot to learn. I'm getting ready to place a second order, and I'm wondering if there are options to consider with shipping cost. The items I'm ordering this time are small (food packaging bags) and relatively light-weight. I estimate that the entire package would be roughly ~50lbs. The problem is that shipping effectively doubles the cost. Are there slower shipping options that I should request that might lower the cost?

    • Dave Bryant
      June 15, 2018 Reply

      At 50 lbs you can only really do air shipping. Even up to 500 lbs or so air is probably going to be cheaper for you. You will simply have to factor this into your cost. If you can't be profitable with those shipping costs, unfortunately there won't be a lot you can do to reduce the your shipping costs unless you plan on order 100x as many bags (possibly even more!).

  • Ann Noukas
    July 1, 2018 Reply

    Hi Dave,

    Thank you for all the info you have provided for Alibaba. I wanted to buy an angel monument for my parents cemetery plot. Prices here in the US are 3 or 4 times as much and I believe they get the same item from china. Is there a specific company you would know that others had experience with for a granite monument. We are looking at about 8k cost or more. People here at monument companies tell me if I don't go through them I'll lose money or it'll get stuck in customs for a year and I won't be able to get item. They tell me they only deal with one or two places out there...but how can I find these? I have been looking at gold members who say they have been in business 9+ years... but I don't know. I'd hate to lose 1/2 dep...and never hear from them again. I live in boston ... I don't even know if there's a port in boston (I think it may be NY where they ship from). Any advice would be greatly appreciated. Thank you!

    • Dave Bryant
      July 10, 2018 Reply

      Hi Ann,

      There's too many questions for a blog comment, but the best place to check is Alibaba. If you're only looking to purchase one though then it will likely be very difficult for you to import it affordably.

  • David
    July 2, 2018 Reply

    Hi, we always ship the item to oversea but always facing the problem, due to customer order item like cosmetics etc, most DHL, FedEx, there don't ship the sensitive item, does any idea solve this?

    • Dave Bryant
      July 10, 2018 Reply

      Yes, products with hazmat issues can be a problem. Unfortunately I don't have an easy answer for you.

  • Kevin Strel
    September 8, 2018 Reply

    Only Gold Suppliers are allow to reply to enquiries. Non-Gold suppliers can read the enquiries, but are not allowed by Alibaba to reply. The enquiring customer is not told this when they message, so it can make the supplier look bad when they don't reply. One would have to find a way to contact the supplier outside Alibaba. I would only do this if I were planning to visit and vet the potential supplier in person. Here is a link to Alibaba FAQ: https://service.alibaba.com/ensupplier/faq_detail/20435526.htm

    • Dave Bryant
      September 8, 2018 Reply

      Thanks Kevin for the great advice! Never knew that.

  • Reema Farooqui
    September 12, 2018 Reply

    Hi Dave,

    Hope you are well. Thank you for all the information. I am so glad I found your website!

    I have found a product and now I want to buy it from Alibaba. I would like to use PayPal for payment but the payment options say “PayPal for offline orders” Does this mean that I will not be buying the product on the Alibaba platform? To me it sounds a little risky but I am not sure I want to use my credit card. What would you suggest?

    Any advice will be greatly appreciated! Thank you :)

    • Dave Bryant
      September 15, 2018 Reply

      Hi,

      Yes, Alibaba does not support PayPal for payments through their platform. PayPal has a lot of buyer protections though.

  • Brianna
    October 10, 2018 Reply

    Hello!
    I submitted an request for a sample of 1 product and so I paid $50 as the seller asked me to. There's a Trade Assurance Contract. After I paid, the seller said that the minimum is 1000 pcs, which is not what I was looking for. I'm still hoping to receive the sample since I paid for it, but I was wondering if I will be charged for the 1000 pcs after the 'initial payment', which was the $50. I'm worried about being charge +$10000.

    • Dave Bryant
      October 10, 2018 Reply

      No, you won't be charged for 1000 pcs unless you want to buy them.

  • Matt Watson
    January 24, 2019 Reply

    Hi Dave,

    Great blog! Discovered you guys from a mention on the Tim Ferris Show from Allen Walton, and have been reading and listening to the podcast since. Not currently involved in the Ecom-world, but your site paints a realistic picture of what is involved. Keep up the great work and hopefully I will be able to meet you guys one day and have an ecomm business to show you based off of what I have learned from EcomCrew.

    All the Best!

    • Dave Bryant
      February 1, 2019 Reply

      Thanks Matt- love to have new readers and listeners :)

  • Mike Higman
    April 2, 2019 Reply

    Great article Dave! This is incredible free content. I've already been through the process but picked up a few things that I can definitely do better. Thanks!

    • Dave Bryant
      April 5, 2019 Reply

      Thanks Mike - appreciate the comments.

  • Franco Buitrago
    July 4, 2019 Reply

    Hellow, I want to ask a question about the collection account holder in citybank Singapore, which is int he name of Alibaba.com Singapore E-commerce Private Limited. I am a buyer and after all the negotiation process with the provider under the trade assurance method, i need to deposit the money via bank transfer under trade assurance, in this bank account. I want to know if it is Alibaba account number, and if are they going to retain the money until the goods arrive to my place, and then, alibana can deposit the money to the provider. The collection account holder is with alibaba.com singapore e-commerce private limited, and, account name is with the provider´s name. is it trusworthy or not? can i make the deposit or not, and if so, who is the right holder of the account? Many thanks.
    Franco Buitrago
    [email protected]
    +573203689350

    • Dave Bryant
      July 24, 2019 Reply

      Sounds legit but I don't want to steer you one way or the other.

  • Babatunde Quadri
    September 3, 2019 Reply

    Very insightful post. why do i have to make sure my product are marked with 'made in china' though

    • Dave Bryant
      September 10, 2019 Reply

      Country of origin markings are required by law.

  • Ralph V Pendergraph
    September 13, 2019 Reply

    I am a solo Land Survey company and I purchased a GNSS system last year. In looking through this same seller's ads(and a few others) - I see that similar whole systems seem to be advertised at half or less of what I paid and what is being quoted now. By weight and the pictures on the ads it is clear that there is either a big mistake or that some are getting these systems at basically half of my price as a small customer. I found two separate ads from my previous dealer that clearly show that this is a 1+1 receiver system for half of my quotes. I mentioned this and supplied the images and info back and this seller claims that these quotes are only for a half system, one receiver. Any advice is appreciated!

    • Dave Bryant
      September 17, 2019 Reply

      Hmm, too many variables for me to make much of an assessment.

  • Dan
    February 17, 2020 Reply

    Thanks for the great info, Dave.
    I'm finding that sellers on Alibaba are currently not very responsive to my requests (not following up/seem interested with my questions/ RFQs); do you know if this is due to the corona virus or is this typical? What's going on over there in the factories?

    • Dave Bryant
      February 21, 2020 Reply

      Yes the Coronavirus will definitely be impacting both their staffing and interest in working with new clients. Make sure your initial requests are easily answered - not in-depth questions about customizing xxx product in 43 different ways - save those for future emails :)

  • Marcos Louca
    June 6, 2020 Reply

    Hi Dave, I have setup my store on shopify and have agreed a 30% discount with my supplier through aliexpress. I am using Dsers to process shipping and order management. My question is once I receive an order from a customer and go to fulfill it it and pay the supplier on AliExpress how do I get my agreed discount price and not be charged the standard prices displayed on their shop. Does the supplier provide me a discount code or will they change my cost on AliExpress?
    Regards Marcos

    • Dave Bryant
      July 3, 2020 Reply

      Haven't used it in a while but I believe the supplier can send you an invoice with the discount reflected.

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