6 Tips On How To Set Up Your Dropshipping Business With Alibaba

6 Tips On How To Set Up Your Dropshipping Business With Alibaba

Alibaba is based  out of China and while there are  suppliers out of the United States, Australia, Europe and Canada for the most part most of the suppliers are from  China, as well as a few other countries  including India, Pakistan and Bangladesh amongst others. Needless to say doing business with international  suppliers can sometimes be confusing, stressful and a bit of a culture shock  if you are not used to it, so I have  created what I call the golden rules of  Alibaba, these are the things that you  always need to keep in mind when  ordering products from a supplier in  China or anywhere else in the world.

1. Alibaba is a wholesale retailer

the first  rule of Alibaba is one that we have  already discussed Alibaba is for  wholesale purchases – you cannot buy a single or small  quantities of products, you're buying  product in bulk and as a  rule of thumb the product per order the cheaper the price per unit. Since you have already discussed in a great amount  of detail the concept of wholesale  buying let's move on to rule

2. Do not confuse Alibaba and Amazon

What I  mean by this is when you purchase a  product from Amazon you can be sure that  the item you order will arrive on time and in perfect condition and exactly as  described, if not you simply contact  Amazon and they will refund or replace  the item for you. Even if you buy a  product from your local store wherever  you are in the world it comes with some  sort of guarantee or protection from the  buyer. That's not always the case with  Alibaba, if your product arrives and it's  not to your liking then you are pretty much out  of luck, because you are not getting your  money back. Even if the product is  defective or damaged is unlikely that  you will get a refund.  Alibaba offers what they call seller  protection and I'll explain what that  means - later on but as a rule of thumb  it's up to you to do your due diligence  and make sure your supplier understands  exactly what you need.

3. Everything is negotiable

Everything on Alibaba is  negotiated irrespective of was written on the page or despite what the supplier  might tell you –  the price is never final. The minimum part of the quantity is  always negotiated and the same applies to the  shipping costs. Any number that you see  on Alibaba is pretty much meaningless. I  have had supplies tell me that the price  of a product is hundred bucks with a  minimum purchase quantity of five  hundred and I can tell you that I have  successfully negotiated with that same suppliers a price for $50 with an order  of just 300 units. So don’t gets scared off  and you see high prices and high minimum  order of quantities, because everything  is negotiated.

4. Do your due diligence

Never take  the word of your supplier that the  product you're ordering will arrive  exactly as described, it’s important to carefully go through the process of negotiating  samples with your suppliers but know  ahead of the time that never order  products without seeing what you're  ordering especially if you're ordering  large quantities. This business model is heavily reliant on suppliers' professionalism, which means that if you don't do your due diligence you might lose a lot of money. For this reason, it's important that you use third party dropshipping tools, such as SaleSource.

5. Focus at the bigger picture

Think  long term suppliers on Alibaba are  looking for customers who will become  lifetime clients. The reason McDonald's give you toys to  kids at an early age is because they  want their kids to come back McDonald's  and supplies in Alibaba have this in common, in the sense that in they are looking at the big picture and always adopting long term strategies. A supplier is more likely to  offer your favourable price as well  as other incentives and better  service at the field that you will come  back and order more products from them  in future. So knowing that be respectful with your suppliers, be patient and them with  them and you are communicating with them  and sound professional. Even if you don't  have a business  let your supply know that you are  looking for a long-term partnership they  are more likely to offer you better  prices.

6. Appearance can be deceiving

Finally don’t trust the appearances, if there is someone with an American  sounding name, usually it's something  like Betty or Steve, know that you're  probably speaking to a teenager whose only job is to translate what  you're saying for their factory manager. You  have to realize that the person you're  talking to understand or doesn't have  any influence over the price or the  quality of your product. His or her job  is to take your messages and translate  for their factory managers, who could be  somewhere else in China. It goes without saying that if  your product arrives defective or not to  your satisfaction, it's pointless complaining to Steve, because the only thing you are  going to do is translate your message  and give it to their bosses.