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Is Alibaba a reliable tool for sourcing from China?

Hi all-

I'm investigating using a relatively unique electrical component in a project I'm working on. Quotes from American manufacturers have been sky-high, so I've been looking at Alibaba, where the prices are much lower. In fact, so much lower that I'm concerned that it's a scam. The suppliers all seem to have the various indicia of Alibaba quality - gold status, accept PayPal, etc.

I'd love to hear from anyone with experience using Alibaba or other sites like it, and if you have any advice about verifying suppliers, or any red flags I should be looking out for.

Thanks!

7 Replies

Greg Pasquariello
2
0
Greg Pasquariello Entrepreneur
Principle Developer at BiggerMind Software
Its like any other market Alibaba will hook you up with buyers/sellers, but youll need to evaluate them yourself. I used Alibaba extensively to start an import company and it was great! Prices are low because, well, prices for asian goods in bulk are low. Im sure there are scammers on there, but Ive never run into one. That said, there are a number of issues that youll need to deal with if youll be importing products from overseas, that could affect your final costs. Those include shipping, import duties, credit terms, etc. There can also be quality issues. Sometimes the lower priced items are lesser quality, so youll need to work with your vendor to ensure that the quality that you need is there. Often, asian companies are particularly primitive, depending on the product. I have seen numerous scams with brokers that represent you in the foreign market. Some are great. Some are not. If youve made contact with a foreign vendor that you think youll want to manufacture or procure your product, travel there, visit with them, and see the operation. Have a number of potential vendors on your itinerary, so if one falls through, its not a wasted trip. Regards - Greg Pasquariello Email: [removed to protect privacy] Skype: gregpasq Phone: [removed to protect privacy]
Joe Zott
0
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Joe Zott Entrepreneur
VP Engineering and Operations at AccuVein
I have had good luck with Alibaba in finding suppliers, but their quality indicators are insufficient to determine if the supplier or product is acceptable for your application. Your needs and quality expectation will be different than another person's so what is acceptable for one may not be for another. My experience with suppliers has been all over. Some Chinese components have equal or better quality to what is available in US, some less, some parts may only be available in China and what you are looking for is the best quality supplier. I start with a good understanding of what quality I need and then make a series of small purchases that we monitor very closely. Multiple purchases over time helps assess reliability of supply chain before you need to rely on it for production. Try to get parts from different manufacturing lots to see if quality varies over time. On occasion I have asked someone to visit the supplier, but I do that only when absolutely necessary. The biggest issue to keep a lookout for is identifying if you are talking to a broker or the manufacturer.
Guillaume Bernier
1
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Guillaume Bernier Entrepreneur
COO and CTO for hire
Hi,

Alibaba is a good source to IDENTIFY potential suppliers, but then you really need to do your own investigation. This means at the very least many emails, even more skype chats, to see how available they are, what is their real level of English, as well as a few phone calls to talk in person. I absolutely recommend that you also visit and inspect your supplier in person.

Personally, I've had great experiences, but also bad (in some cases, I paid 5000$ - 50% of the transaction - and lost it all when they failed to ship anything at all). In that particular instance, it was from a supplier that I had met in person in China...

I also recommend you start with a small order, and slowly build the relationship, but I wouldn't put too much value in the gold supplier thing. I think they can just pay to have that. In my case, I even bought an official 3rd party audit document, and the document was raving about their abilities, but I suspect that the person I was talking to was not really working for that specific manufacture, just a reseller.

Also, keep in mind that in the case of a scam (which I experienced) your recourses are nil. Nobody at alibaba could care less, and they won't help you with anything.

So, it is a risk you need to take.. but if you are paying 20% of the local US price, it may be worth it. In my experience, despite the lost on one transaction, the net has been a positive one as I saved much more than I lost.

Also, take everything you are told with a grain of salt. For example, I purchase items that were supposedly "warranties for 2 years", but right when I received them, there were some issues with some lamps (didn't ship exactly the right model, problematic packaging) but they refused any sort of exchange or replacement. There is NO warranty - ever - in China.

Again, my advice:
- email
- chat
- phone
- onsite visit if this is going to be a major supplier

Also, before transferring any money, I always require pictures of my items BEFORE they are packaging. It doesn't guarantee against a scam, but at least it can save you some trouble again someone who isn't reliable and was going to ship the wrong items, etc.
Guillaume Bernier
0
0
Guillaume Bernier Entrepreneur
COO and CTO for hire
I entirely agree with Joe Zott that it is extremely important to know if you are dealing directly with the manufacturer, or merely with a broker (who himself can also be dealing with 2 more layers of brokers). Unfortunately, I find it nearly impossible to know whether you truly are dealing with the ultimate factory.

It is common that people in the factory do not speak English at all, so you need to deal with a broker. But on one occasion, when I went to China and visited about 6 of my suppliers, I ran into a surprising situation. I am in the office of my supplier, and he tells me we are going to visit HIS manufacture (it was metal casting), but when we drive to the place (it was about 1h outside of town), the guard at the entrance didn't immediately open the gate when we arrive, and my contact had to get out and discuss with the guard for a minute before they opened the gate. Clearly, this was not HIS factory if the guard didn't immediately recognized him.

Furthermore, it helps if you have someone on your side who can speak and READ mandarin. As one friend once told me, it allows you to see if the name of the business on the business card matches the name on the building...

I would be more than happy to help if you want, I have been to China quite a few time and have had some good luck finding reliable suppliers there.
Arun Joshi
0
0
Arun Joshi Entrepreneur
President / CEO Visulon Inc.

As some of guys have said, you must weed out brokers.. agents. These are there because someone in there office speaks better English.

If you hit real manufacturer .. do several conversations .. and I suggest you visit there.
I visited 'Foshan City' and stayed two nights .. met everyone in the company.

Good luck

Arun
Manny Acevedo
1
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Manny Acevedo Entrepreneur
Business Systems Analyst & Entrepreneur
Just re-iterating what everyone else has said.
1.You need to speak directly to the manufacturer. They will say they are, but they are not. They are just some broker. yes, they lie.

2. If you can find someone on the ground in China to to be your eyes and ears, do it. It's worth it. They can go and make sure the deals are good, source materials, packaging & QA your shipment before it ships. Also, they can translate and show you around if you visit. I paid them via an HSBC debit card that was attached to a dedicated account to pay them, pay for samples and grease wheels.

3. If you go and visit a manufacturer, it makes a difference. It's still a realationship business there. A face to face meeting and plant tour, will go a long way to developing a good relationship and a better deal for you.

Good luck

Manny

Guy Soffer
0
0
Guy Soffer Entrepreneur
Consultant & Developer

Zero problems here (I mostly order standardICs and sensors)


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