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Forget AliExpress! Alibaba Dropshipping Is A Much Better Sourcing Model

Published on: December 9 2022 by MyWifeQuitHerJob Ecommerce Channel

Forget AliExpress! Alibaba Dropshipping Is A Much Better Sourcing Model

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Forget AliExpress! Alibaba Dropshipping Is A Much Better Sourcing Model

in this video you'll learn how to get
started in e-commerce with practikally
no money at all by drop shipping through
alibaba now normally i'm not a big fan
of drop shipping but this method will
allow you to test products online to see
if they will sell before you invest a
lot of money on inventory
now alibaba drop shipping is one of the
best ways to sell high quality products
without carrying inventory yet few
sellers know that they can actually
dropship through alibaba for most
starting an e-commerce business on a
budget is challenging but thanks to
alibaba's drop shipping solution finding
products and wholesale suppliers is
simple and easy now this step-by-step
guide will teach you how to get started
with alibaba drop shipping explain its
pros and cons and share tips to help you
start a successful drop shipping
business that you will eventually
convert into a private label store
now does alibaba do drop shipping now
alibaba is the go-to marketplace for
foreign businesses that buy low-cost
products in bulk the labor manufacturing
and electricity costs in china among the
cheapest globally making it beneficial
for sellers and buyers now when most
people think about alibaba they think
about shipping containers of products
from china however alibaba has a drop
shipping solution that makes it easy for
store owners to sell products without
keeping stok on hand however it can be
a bit challenging to find drop shipping
suppliers on alibaba and alibaba sellers
generally avoid fulfilling small orders
however there are suppliers on alibaba
that cater to drop shipping sellers
now why use alibaba for drop shipping
versus aliexpress although aliexpress
drop shipping is the easier way to start
an e-commerce business using alibaba is
the better choice for drop shipping for
the following reasons
there's cheaper product pricing product
pricing is higher in aliexpress as it's
set up for retailers and individuals on
the other hand alibaba has wholesale
pricing where buyers can have margins as
high as 70 percent it also helps that
alibaba charges almost no commission on
sales in contrast aliexpress charges its
suppliers anywhere between five and
eight percent per sale
you also get to directly interact with
manufacturers buyers can deal with
manufacturers directly on alibaba unlike
aliexpress where there are more
retailers and middlemen than
manufacturers now working with factories
enables buyers to build relationships
that can help them get bigger discounts
when buying in bulk
can also customize private labeling
allows buyers to rebrand products under
their own brand name thus they can
develop their brand position and inspire
customer loyalty without investing in
product manufacturing now most suppliers
in aliexpress generally don't allow
customization on the other hand alibaba
suppliers provide buyers with various
customization options such as custom
labels and designs
now alibaba also has a request for
quotation feature where buyers can
request quotes by filling out a form
detailing the products or services
they're interested in and relevant
manufacturers then reach out directly to
you with pricing and delivery terms now
rfq is convenient because it saves time
finding suppliers aliexpress doesn't
have this feature
alright so here's how alibaba drop
shipping works you connect your store to
alibaba you find products to sell you
import these products directly into your
online store and then when an order
comes in the drop shipper fulfills the
order
all right so here's a step-by-step guide
on how to dropship with alibaba to
dropship from alibaba you need to find a
niche and validate the product with your
target audience so start out by checking
out online marketplaces like amazon to
understand the average selling price of
the product you plan on selling and then
once you figure something out it's time
to open an account with alibaba
all right so here's a step-by-step
tutorial on how to get started step one
you've got to search for suppliers so
head over to the search box on alibaba
to find the product use the products
drop down to find products and suppliers
and avoid using the suppliers drop down
as that will limit your filtering
options
narrow down the suppliers by using the
filters available on the left hand side
make sure you check the trade assurance
supplier type even if you don't wish to
use that service suppliers that accept
the buyer protection terms in the trade
assurance program are much more likely
to be authentik
now make sure you check out the ready to
ship and paid samples check boxes to
narrow down the list further
now using these two filters increases
the likelihood of finding suppliers who
dropship skip these two filters if you
want to customize the products as
suppliers offering fast dispatch are
unlikely to offer customization
next type 1 in the minimum order filter
as suppliers in alibaba generally have
higher minimum order quantities or moqs
step two check the product details now
on the product page review the pricing
in moq if you see one piece minimum
order the supplier will probably
dropship for you now the pricing will be
expensive for quantities up to 25 or 50
after which you'll see a considerable
price drop now this pricing does not
include shipping costs unless specified
step 3 make a list of potential
suppliers now not all suppliers will
meet your standards or be willing to
dropship so compile a list of potential
suppliers to give yourself more options
as you negotiate pricing do a background
search on all the suppliers and check if
they meet the following criteria they
partikipate in the trade assurance
program they offer a moq of one they
have reasonable pricing and they have
good reviews and ratings
step four contact your suppliers
contact suppliers by clicking on the
contact supplier button and you'll be
using alibaba's messaging platform that
works just like email you can also ask
for the supplier's wechat id china's top
instant messaging app where you're more
likely to get faster responses now it's
also worth noting that there's a 14 to
16 hour time difference between the us
and china so some suppliers may reply
slower should also be prepared for
communication challenges now to minimize
them use language translation tools such
as google translate now even if the
supplier speaks english it's best to
avoid lengthy sentences with complex
words so stik to short sentences with
simple words now your first message
shouldn't be too long and your goal
should be to find out if they drop ship
their products to the countries you plan
on selling here's an email template that
you can use to inquire about drop
shipping hi my name is steve chu i'm
from xyz company and we're based in
california we're interested in
partnering with you to drop ship this
product
our customers are in the us and the uk
could you please answer the following
questions what is your moq cost per unit
and the shipping time to the u.s and
what are your payment terms for new
customers i would also like to order a
sample please send me the cost for the
sample and shipping to the following
address thank you steve
now keep in mind that you should also
avoid using links to gmail whatsapp
facebook and dropbox in your email as
these services are banned in china also
avoid attaching large files to the email
or message as the internet speed in
china isn't necessarily the best
step 5 decide on the payment method now
alibaba supports multiple payment
channels such as credit cards online
transfers and paypal but here are the
four standard payment methods rated from
safest to least safe
alibaba trade assurance is an escrow
service where the funds are released as
a supplier only when the buyer receives
the goods as per the agreed terms
alibaba's trade assurance provides buyer
protection from faulty products and
fraud it also gives buyers confidence in
knowing if their money is handled
through a third-party escrow service
however trade assurance does cost the
supplier money and delays the reception
of funds so as a result the supplier may
not prefer this mode of payment you can
also pay by paypal most suppliers accept
paypal for small orders however paypal
is not preferred as dishonest buyers can
file chargebacks even after receiving
products in good condition
paypal also charges a hefty transaction
fee which suppliers may not be
comfortable paying however as a buyer
paypal probably offers the best
protection can also pay by credit card
and debit card alibaba supports payments
for major processors such as mastercard
american express and visa suppliers
generally don't have any issue with this
payment mode as they receive the funds
immediately but it can be expensive for
a supplier because there are fees
involved
and then finally there's a bank transfer
transfer suppliers based in china are
made with telegraphic transfer now bank
transfers are slow and thus not suited
for drop shipping the only reason i'm
mentioning them here is for completeness
step six negotiate terms once you have a
short list of suppliers you can start
negotiating now negotiating with
suppliers is an art but here are a
couple tips and tricks to help you
master negotiation
be confident in your communication if
you show you're a first-time drop
shipper the supplier may not be as
interested in doing business with you
ask relevant questions don't ask
anything that you can find on google do
your background research and read guides
on buying and sourcing from alibaba
before negotiating with them
offer to pay extra if you find a
supplier with a minimum order
requirement of 5 or 10 units you can
offer to pay a higher price for a single
unit now the supplier will likely accept
your offer if it makes financial sense
and then finally step seven select a
supplier after you've ordered samples
and negotiated terms it's time to weigh
your options and select a drop shipping
supplier now if you're unsure which
supplier to finalize for your order look
at how and when they reply to your
emails prompt communication is essential
especially if you're drop shipping
products from china you can also check
if the supplier offers customization or
private labeling even though you might
not need that right now you may decide
to build your brand in the future
now is drop shipping from alibaba safe
buying from alibaba is 100 safe as long
as you buy from alibaba suppliers using
trade assurance a free service that
offers buyer protection for orders
purchased through alibaba
now trade assurance covers these
scenarios products that are not shipped
according to the agreed schedule
products that don't meet the quality
standards and here are the eligibility
requirements the supplier must be a
trade assurance supplier the order has
to be placed on alibaba and the payment
must be made using alibaba's payment
platform now if there's any issue with
the order buyers can file a dispute and
request a refund within 30 days and
alibaba investigates a claim and request
documents when necessary now the seller
refuses to cooperate with alibaba buyers
receive a refund directly thus trade
assurance protects buyers from scams and
unsafe products however this doesn't
mean the suppliers that aren't in the
trade assurance program are
untrustworthy or deceitful it just means
buyers need to be more careful when
buying from those sellers that do not
support trade assurance
now here's how to vet an alibaba drop
shipping supplier you always want to use
verified suppliers alibaba has a
verification program where suppliers get
badges based on inspection and customer
feedback and this verification badge is
located on the left hand side of product
pages there's three types of badges gold
supplier these suppliers pay fee to be
verified as businesses with commercial
or industrial operations verified
suppliers these suppliers are thoroughly
inspected by third-party institutions
and finally there's trade assurance
these suppliers accept payment via
alibaba.com's payment platform
now having either badge doesn't
guarantee product quality or a seamless
buying experience however these ratings
are an excellent first step in narrowing
down your suppliers and buyers can also
look out for specialty tags given to
suppliers based on performance such as
environmentally compliant repeat buyers
choice good reputation supplier and you
always want to ask questions and verify
documentation you can actually contact
suppliers before proceeding with an
order make sure you ask for the business
details license and any other
information not available in alibaba now
alibaba doesn't have any restrictions on
how or when to contact suppliers and
buyers can take advantage of this by
video calling the suppliers and
virtually inspecting their factories you
can also do a google search on the
company's address and verify their
location
you also want to check the suppliers
sopi
sopi stands for supplier online
performance index and is a data-driven
rating based on a supplier's performance
on alibaba soap high performance is
measured in terms of transaction volume
product popularity service quality and
presentation quality and there's six
levels zero to five with five being the
best each level is represented with a
matching number of diamond icons and
buyers can find a supplier so pi on
product pages company profile pages and
the search results you always want to
ask for samples asking for samples is
customary even if you're drop shipping
and not buying in bulk and it's best to
get a sample to verify the quality of
the product before investing in the
inventory you always want to trust your
gut here be prepared to walk away if you
feel anything suspicious about the
transaction if the pricing or the quotes
just sound too good to be true then it
probably is all right so here are the
pros and cons of alibaba dropshipping
the pros are low manufacturing costs now
the primary reason to buy from alibaba
is for cheap pricing prices are
significantly lower than america you get
more product selection there's over 5
900 product categories in alibaba and
buyers can also request to tweak designs
as per their liking when ordering in
bulk you get access to a large database
of suppliers alibaba has more than 2.8
million suppliers and there are multiple
suppliers producing the same product
with similar quality so it gives buyers
more options
you can also customize alibaba suppliers
provide customization by adding designs
logos embroidery and labeling with no
minimum order requirements the pricing
is also low but buyers can expect a
discount when buying in bulk it's also
pretty easy to use the alibaba website
is easy to navigate and the ordering
process is seamless sellers can also
visit the suppliers company profile page
and download reports of their
inspections and there's a rigorous
verification process alibaba takes
background checks seriously they have
programs where a third party institution
does vendor assessment they also have a
buyer protection program called trade
assurance which refunds the money to
buyers upon delayed shipping or poor
quality
now here are the downsides alibaba has a
massive ip protection problem and it's
not uncommon to find counterfeit
products on alibaba so buyers should
avoid buying products with trademark
brand names and characters anyone
selling such items will be subject to
legal action in their country the
shipping times are long one of the
biggest drawbacks of ordering from
overseas is the long shipping time
most suppliers on alibaba ship the
products in cargo ships which takes
around a month to deliver however buyers
can pay extra for air freight there's
also different manufacturing standards
products made in asia have different
sizing so for example a size 6 in the us
is different from a size 6 in china and
buyers should make sure they're direct
in their instructions and give detailed
simple product descriptions when
communicating with suppliers the return
process is also very time consuming now
although the return process isn't
necessarily complicated arranging a
return from the customer to china can be
expensive applying a high margin on
products helps you absorb these losses
incurred from such returns now what are
the next steps now you know how to get
started well the next step after drop
shipping from alibaba is to make a list
of your top selling products buy your
winners in bulk and get lower pricing
now the best part about dropshipping
from alibaba before buying wholesale is
that you can develop a relationship with
the factory directly and as your
business grows you can import the goods
to a warehouse in north america or use
amazon fba to outsource inventory
management and order fulfillment fba
will store and ship orders to receive
from amazon as well as other
marketplaces now just gotta remember
drop shipping is a stepping stone in the
world of entrepreneurship and e-commerce
shipping solution gives you everything
you need to build a successful drop
shipping business which you later want
to convert to a private label brand that
you control
hope you enjoyed this video now if you
like what you saw there's actually a lot
more where that came from if you
subscribe to my channel below and if you
are interested in learning how to sell
physical products online then click over
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course where i'll walk you through
everything that you need to know to get
started in e-commerce thanks for
watching

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