Alibaba is an online platform that allows users from all over the world to connect with suppliers in Chinese markets. Yet, many people wonder whether or not this platform is legit or a scam. The simple answer to the question is that Alibaba is a legit platform.
This online eCommerce platform is safe and reliable for you to source products. However, there is always a possibility of scams on the platform. So, you should stay aware and be cautious to avoid falling into the trap of fraud or scam. Most importantly, finding the right supplier on the platform is critical.
This article will give you a comprehensive overview of what the Alibaba platform is and the things that make it legitimate. Furthermore, we’ll tell you about the ways that will allow you to find the best and most reliable suppliers on this platform.
Table of Contents
Chapter 1. Overview of Alibaba.com. How does it Work?
Online marketplaces are not new and have been around us for quite some time. However, the most critical factor when choosing a manufacturing or wholesaling partner is trust. So, if you plan on sourcing and buying goods from China, you need a trustworthy partner through a reliable platform.
And one of the most common platforms to source and buy goods from China is Alibaba. Let’s delve deeper into this to get a better idea about the Alibaba platform.
1) What is Alibaba?
Alibaba is a Chinese-owned wholesale marketplace. Jack Ma along with a few other people founded the company in 1999.
The platform is the go-to option for many people who want to source products from the Chinese market. So, if you plan on sourcing and procuring your supplier internationally, then you might want to learn about Alibaba drop shipping.
According to the numbers, Alibaba has earnings of around $135 billion last year. Thus, it is the largest eCommerce company globally. It has an extensive directory that helps wholesalers and suppliers, mainly from Asia to connect with buyers from all over the world.
2) How Does Alibaba Work?
As mentioned earlier, Alibaba is a marketplace for buyers to meet wholesalers. It allows buyers to purchase bulk quantities of different products at budget-friendly pricing. Furthermore, you can also bargain with manufacturers, give orders for custom items, and save significant amounts of money.
Most importantly, it makes it easy for you to connect with the manufacturers and suppliers in China. You can contact and ask for quotes on certain quantities through the platform. Furthermore, it is also an optimal choice if you want to buy private-label products since you can get them from the manufacturer directly.
Another important thing to note is that Alibaba is a holding company that owns three more Chinese marketplaces—Taobao, Alibaba.com, and Tmall.
The online platform has millions of users and hundreds of millions of products. From grocery items to gym equipment, Alibaba is a one-stop solution.
3) Is There Any Difference Between Alibaba and AliExpress?
Some people might make the mistake of considering Alibaba and AliExpress as the same thing. While both of them are Chinese-based online marketplaces, they have a significant difference that sets them apart.
One of the big differences between both these online is that Alibaba is mainly for B2B (business-to-business) transactions. On the other hand, AliExpress allows consumers to directly purchase products from manufacturers.
Simply put, Alibaba is a suitable option for large and small companies that plans on buying goods from China. Conversely, AliExpress is a platform that is best for drop-shipping products at retail prices. While sellers on Alibaba might have a minimum quantity of products, there won’t be any such requirements when ordering from AliExpress.
Since Alibaba allows you to buy products directly from manufacturers, you can easily create a private label with custom designs or logos. That is something you won’t find with the AliExpress since items over there are pre-made. Therefore, it offers limited options for personalization and is more costly.
Another important thing to note is that the sellers on the AliExpress platform provide ePacket shipping. Therefore, it helps your eCommerce business to deliver top-notch quality products to your customers without any hassle. The shipping process for Alibaba is comparatively higher since you order in bulk quantity.
These are some of the major differences that differentiate Alibaba and AliExpress from each other. Anyone looking to buy products at a lower price in large quantities should opt for the Alibaba platform. But if you want to get goods quickly and in a smaller quantity, then go for the AliExpress platform.
Chapter 2. Is Alibaba Legit & Safe? Top 5 Reasons!
Alibaba is one of the biggest eCommerce platforms in the world. The platform assists people from all over the world to connect with Chinese manufacturers, suppliers, and traders for buying products.
So, there is no doubt about its legitimacy. And various factors prove Alibaba is legit. Let’s discuss them in more detail.
1) Trade Assurance
The best thing about ordering products from Alibaba is that it offers you trade assurance. You can purchase products through the platform through this method. It is a free program that you can use which ensures that you’re orders have complete coverage and protection till you get them.
So, if you place an order through Alibaba and it doesn’t get delivered to you, the platform will accept complete liability. Not just that, but they will also handle all the disputes on your behalf and deal with the supplier accordingly. Client satisfaction is the utmost priority for Alibaba.
That is why they lay special emphasis on creating an environment where the buyers and sellers can trust each other. This is the primary reason they provide you with a money-back guarantee if the supplier fails to meet your requirements. So, you have the peace of mind that you’ll get the right products.
As for the supplier, the Trade Assurance program allocates a credit rating. It means that the suppliers now have the motive to provide you with products in optimal condition promptly. Here is a brief overview of how the whole trade assurance program works:
- Enroll in the Trade Assurance and place an order
- Pay the suppliers according to the methods mentioned on Alibaba
- Wait for the delivery of your products
- Leave a review about the supplier’s overall services
When searching for a supplier, it is best to find one that has a trade assurance symbol. Then follow the same steps to place an order with them as you would with any other supplier. You don’t have to worry about anything else since Alibaba itself will secure the order.
2) Positive Customer Rating
If you search the Alibaba app on your Google Play store or Apple App Store, you’ll notice that it has millions of reviews. The Alibaba app also has a rating of 4.5 stars on the Google Play store. These factors indicate that Alibaba is a legit platform that serves millions of customers globally.
It is a safe e-commerce marketplace that has millions of users from all over the world. However, it is best to use the resources that the Alibaba website provides and perform all transactions through it. This way, you can mitigate the chances of any possible fraud.
The same is the case when we talk about finding reputable suppliers. If a supplier provides high-quality products and optimal customer services, they’ll maintain a good rating and have positive reviews. So, it is best to go through the supplier’s ratings and reviews before buying any products.
If you plan on doing a transaction outside of Alibaba, then you would be solely responsible for all your actions. Again, keep in mind that Alibaba acts as a directory where you can find information about different suppliers in the Chinese market. It is important to conduct your own due diligence and find the right supplier.
3) Safest Payment Method
The safest payment methods are what make Alibaba a legit business. As mentioned earlier, the Alibaba Trade Assurance program allows you to get complete protection for your products. The order is 100% protected since the platform will take complete responsibility if you don’t get the order.
The platform will open a problem on your behalf and handle the dispute for you. From there on, the company will meditate between you and your supplier to come up with a solution on what to do next. Therefore, it ensures that the platform will not abandon you in case the supplier doesn’t fulfill their part.
Although Trade Assurance is a safer option, it can take some time for the platform to mediate an agreement. This means that your money can get stuck for weeks or even months until you resolve the issue with the supplier. So, it can lead to inventory management and cash flow problems.
Nevertheless, there is a solution to this problem as well which is to pay through different safe options. You can use your credit card or PayPal account to pay for the order. This gives you the ability to file for a dispute if the supplier didn’t fulfill their responsibility.
Again, it is important to note that you don’t necessarily have to pay with your credit card or PayPal for the Trade Assurance program. But doing so will give you an additional layer of protection for your payment.
4) Huge Customer Base
The huge customer base is also a clear indication that the platform is reliable and legit. Currently, more than 100 million people have downloaded the Alibaba app from the Google Play Store.
The case is no different from the Apple App store which has millions of downloads. In addition to downloads, there are more than 305 million active users of the platform. This huge customer base shows that people have put their trust in the platform’s services.
5) Gold & Verified Suppliers
In case, you didn’t click on the “verified supplier” option, you should check for at least the gold supplier badge for every manufacturer you come across. Gold supplier refers to a membership tier for suppliers on Alibaba.
To become a verified gold supplier, an individual must go through a detailed check with complete ID and address verification.
Apart from that, third parties will conduct a background check to ensure that suppliers compile with all the laws. But, you should note that having a gold supplier badge doesn’t mean guaranteeing a trustworthy supplier.
The company’s process to achieve gold supplier status is comparatively easy. So, any business can become have a gold supplier status.
Also, some gold suppliers might have a legitimate business, but their services or products won’t be up to the mark. Other companies might be just a few individuals who come together and rent a small office. So, they cannot be counted as legitimate suppliers of products.
Nevertheless, a gold supplier is a good indication that the supplier will provide optimal services. After you verify the gold supplier’s status, the next step entails going through Alibaba’s “verified supplier” reports.
It contains a more detailed inspection and can give you a clear idea about the company’s identity. Here are some things you can look for in a potential supplier:
- Which country does the company mainly export its products to?
- Where does the company have its manufacturing facility?
- What year was the company founded?
- What is the company’s staff size?
- Is the business a manufacturing unit or a trading company?
- Did the company complete the previous shipments on time?
These are the few things that you should check when evaluating the verified supplier reports. This will give you a clear idea of whether you should order products from a supplier on Alibaba.
Chapter 3. How to Securely Source Products from Alibaba?
Is Alibaba legit? As we all know, Alibaba is the largest e-commerce platform to source products globally, so it is obviously a legit option. However, the real deal is whether the supplier you’re negotiating with is real or not!
While Alibaba provides a lucrative opportunity for serious businesses to grow but unfortunately, some fake suppliers are present on Alibaba too, which is a nightmare for buyers.
Sourcing products from Alibaba looks easy, but in reality, it isn’t! In fact, businesses have to be very careful while dealing with suppliers because you never know when they will flip. So to avoid losing thousands of dollars, this guide will share some effective ways to securely source products from Alibaba.
Could you take a seat and give it a complete read?
1) Avoid Certain Products
Finding a reliable supplier on Alibaba is the hardest task to do. One of the common ways of identifying fake suppliers is to see if they are offering products significantly lower than the actual price. For instance, offering Apple air pods for $30.
Many fake suppliers on Alibaba try to sell counterfeit products; therefore, do your research before buying if a product on Alibaba is priced much lower than comparable products from other sellers.
Before placing a sizable order, this may entail looking at the supplier’s testimonials, confirming their company license and other qualifications, and asking for product samples.
2) Purchase from Verified Suppliers
The best way to securely source products from Alibaba is by purchasing from verified suppliers. Verified suppliers pay a significant amount to do business, and there every deal is protected by the platform. Alibaba provides suppliers with a verification service that entails confirming their company profile, business license, and other pertinent data.
On their product listings, suppliers who have been confirmed by Alibaba will have a unique icon showing that they have gone through this verification procedure.
When choosing whether to make a purchase from a specific supplier, you need also take into account additional criteria, such as their product quality, pricing, delivery options, and customer service, in addition to confirming the supplier.
You may make a better-informed choice and lower your chance of running into issues when purchasing from Alibaba by considering these aspects and conducting your own research.
3) Make Sure Your Payment Method Is Secured
To avoid fraudulent activities, businesses should always make payments through secured modes.
Alibaba offers “Alibaba Secure Payment” (often referred to as “Alipay”), a safe payment method that is intended to safeguard customers’ funds until they receive and verify the things they ordered.
To make it work, the buyer must first confirm that the product has been delivered and is in excellent condition before the payment is released from escrow. The seller receives the payment only after that.
Never pay outside Alibaba!
It’s crucial to be aware that some Alibaba sellers might request payment from customers outside of Alibaba’s safe payment platform, which could be a warning sign of possible fraud. Consequently, it is advisable to use Alibaba’s secure payment system exclusively and to avoid any suppliers who request payment in another way.
4) Have A Conversation With the Supplier
If you did your research and still need clarification on it, then it’s time to chat with him!
Businesses can form relationships with suppliers on Alibaba by conversing with them, which can foster trust and boost the likelihood of a beneficial business arrangement. For companies who intend to buy from the same supplier repeatedly, this can be particularly crucial.
Speaking with suppliers can provide businesses with the chance to bargain over things like prices, minimum order sizes, and delivery schedules. This can assist companies in obtaining the greatest rate and guarantee that their requirements are satisfied.
Similarly, chatting can be a quick and simple way for businesses to address issues and receive the information they require if they have any queries or reservations about the items or the provider.
5) By Checking Product Listings
Buyers can confirm crucial supplier details, such as the supplier’s name, address, and contact information, by looking over product listings. This can help guarantee that the supplier is reliable and reachable in case of problems.
Reviews matter a lot in judging a supplier’s credibility. Reviews and ratings left by customers who have bought the product are frequently included in product listings.
Analyzing these reviews can give important information about the product’s reliability, quality, and customer service. This can assist customers in making wise judgments.
Likewise, studying product listings can also reveal details about the supplier’s shipping and payment policies, including approved payment alternatives, charges, and shipping lead times. This can make sure that customers are comfortable with the terms of the deal and the payment and shipping schedules.
6) Requesting A Quote Before Buying
It is better to know what you’re paying for than to pay and think about what you get in return! That’s why requesting a quote from the supplier is considered a viable way to source products from Alibaba safely.
Businesses can offer detailed information about the product they are interested in, such as the desired quantity, specifications, and any customization possibilities, when obtaining a price from a supplier.
The supplier will then be able to offer a quote with the unit pricing, the minimum order quantity, and any other useful information like shipping fees and delivery estimates.
Businesses can evaluate costs and terms from many suppliers by asking for quotes, allowing them to decide which source to engage with after doing so. By doing so, customers can make sure they are obtaining the greatest bargain and that the supplier can meet their particular requirements.
7) Trade Assurance Program
It is difficult to trust a supplier for the first time, no matter how much research is done, because thousands of dollars are at stake. Therefore, Alibaba offers a trade assurance program to secure transactions between buyers and suppliers to avoid inconvenience.
Here are the following protections in the trade assurance program:
- Customers may file a dispute and request a refund if the product quality needs improvement.
- Customers may file a complaint and ask for a refund if the supplier fails to deliver the product on schedule.
- Until the customer certifies that they have received and are pleased with the product, payments made through Alibaba’s Secure Payment system are held in escrow.
8) Conduct an Inspection
How will you make sure the product manufacturing process meets your requirements? Obviously, you can only fly to China and monitor the process for a few months. Therefore, hiring an inspection team is a viable solution to save both time and cost.
An inspection team can conduct on-site checks of the production procedure to help find any potential flaws or concerns with quality control. They can also carry out pre-shipment inspections to make sure the goods adhere to the needed standards for packaging, specifications, and other factors.
Employing an inspection team can assist organizations in monitoring compliance with labor and environmental requirements in addition to assuring quality. They are able to pinpoint any problems with working conditions or environmental effects and offer suggestions for change.
9) Buy Products through EJET
By following the above-mentioned strategies, businesses can securely source products from Alibaba despite doing it for the first time. However, if business owners still need help sourcing products from China, there is no need to worry about it because we have a solution for this too.
Many businesses, when finding it overwhelming to deal with non-native suppliers, look for a middleman to negotiate on their behalf. Someone who can understand their needs and deal accordingly with that said, EJET comes as a savior for all.
EJET is a sourcing company that has years of experience in performing digital marketing ventures and has helped businesses grow.
EJET has a team of experts in various departments that look for the ideal supplier that can meet your standards. Instead of doing it all wrong, it is wise to hire EJET, which can conduct market research efficiently and can get your competitive price over other suppliers.
To know more information, please contact our sourcing consultant!
Chapter 4. Some Common Scams You Must Be Aware Of
As discussed in previous Chapters, scammers are present everywhere, whether it’s an online or offline marketplace. However, Alibaba is the biggest online marketplace operating in China, which means the higher the number of sellers, the higher the presence of fake suppliers.
Although the platform has filtered and wiped out many fake suppliers, there is still a significant presence of scammers on Alibaba.
Since the trend of e-commerce has gained immense popularity after COVID-19, many people find this a potential way to make sales globally. Considering the rising entries of newcomers in the market, scammers looted them in many ways.
Therefore, if your business has just started out, you should be aware of all the scams trending on Alibaba. While it is not possible to be aware of every scam, there are a few you must know about.
Check it out!
1) Fake Profiles
Even scammers know that buyer will visit their profiles and see their history; therefore, some suppliers create unverified fake profiles to appear legitimate from a buyer’s perspective.
A legal supplier’s identity might be stolen by scammers, who would then make a bogus profile using their name and pictures. To make their account appear official, they could use certificates or documents that have been stolen.
Phishing scams can be used by con artists to get real suppliers’ login details so they can construct a phony profile using those accounts. Also, they can pose as Alibaba and send phony emails to suppliers asking them to confirm their data.
2) Fake Trademarks
Another trick scammers use on Alibaba to make their accounts and items appear real is the use of fake trademarks.
A well-known brand or trademark’s name may be imitated by scammers to deceive consumers into believing they are buying a genuine product. To make their goods appear authentic, they might also employ a logo or design that is comparable to the original.
3) Low-Quality Product
The next common scam is the low-quality products that some suppliers are notorious for. After receiving payment, scammers may offer a high-quality product but deliver a subpar one.
To deceive customers into believing they are receiving a better product than they actually are, they could utilize false images or descriptions.
Thieves could advertise a low price for a product and then provide a defective item to make up for the lower price. Even if they are aware that the product is of poor quality, they could offer a low price to entice more customers.
4) Fake Branded Products
Buyers should always extensively study the supplier and product before making a purchase in order to prevent falling for scams from selling imitation branded products on Alibaba. They should verify the trademark and certification details to make sure they are accurate and, if possible, request product samples.
To protect their money, buyers should be careful of offers that seem too good to be true and use secure payment methods. Also, customers can report any bogus trademarks or knockoff goods they come across on the platform via Alibaba’s Intellectual Property Protection program.
5) Increasing Prices after the Order is Placed
Businesses spend weeks negotiating on price, and when they place the order, the supplier increases the said prices. This is one of the common tactics applied by scammers to bait buyers.
Buyers should always speak with the seller before making a purchase to understand the whole cost of the product, including any fees or charges, in order to prevent falling for the scam of the price going higher after placing an order on Alibaba.
When placing a purchase, they should also get a thorough explanation of the pricing structure and confirm the final price. In order to protect their money, purchasers can also employ secure payment methods. They can also alert Alibaba’s customer support team to any questionable activity.
Chances are you may see them while taking quote from supplier and by then you’d already know how to secure yourself.
Suggested Reading: How to Pay Suppliers Using Alibaba Payment: Best 8 Methods to Know
Chapter 5. FAQs about “Is Alibaba legit”
Let’s go over some questions that most people have about Alibaba.
1) Are Alibaba suppliers trustable?
Yes, you can trust the suppliers and manufacturers offering their services on the platform. While there is a chance of scams, it usually occurs when you choose the wrong supplier. Go for verified suppliers that have trade assurance badges to mitigate the chances of scams.
2) Is the payment method that Alibaba offers secure?
Yes, Alibaba group offers a trade assurance program that offers a secure payment protection system. It allows you to continue trading safely through the online marketplace. Furthermore, there are payment methods available that you can choose from at your convenience, such as:
- Western Union
- Credit Card Company Payment
- Bank Account payments
- Telegraphic / Bank Transfer
- PayPal
3) What is the right method to communicate with Alibaba suppliers?
Alibaba allows you to communicate with suppliers through its contact options. Using this option, you can discuss the requirements with different suppliers. It is quite similar to communicating with the supplier through emails where they reply to you back with quotes and samples.
Apart from that, you can use different social media platforms to communicate with the supplier such as WeChat.
4) How to find out if a supplier is legit?
While Alibaba is a legit platform, not all suppliers on that platform are legit. So, it is important to check for the legitimacy of the supplier. Here are a few things to keep in mind when checking for a trade assurance order:
- The supplier should have a gold membership
- They should accept Alibaba’s trade assurance service
- There is a verified seller’s badge on the supplier’s profile
If all these things are available, then it means that you can trust the supplier.
Also read on: Buying Wholesale From China: Finding Suppliers & Safety Tips
Conclusion
We hope you have your answer to the question of whether Alibaba is a legit platform. The company has been in business for years and is helping individuals all over the world to get access to Chinese products.
Using the right ways will allow you to find a reliable supplier on the Alibaba platform. It will make things easy for you and ensure you save a significant amount of money.
