Sourcing on alibaba. Questions you need to ask

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“Your blog speaks to the many issues I have experience with when doing business in China”  –  a California company

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Just as I go to Walmart if I need a pair of cheap gardening gloves or some Tupperware, so if I really want to get some quick quotes on a low value added product I will look on alibaba. Alibaba can be very useful for getting an idea of how much a product costs. Even Chinese vendors use alibaba as one of my long-time Chinese friends/associates has told me ( much to my surprise). In fact I know now that if I ask a factory about a project, and one component of that product is outside their area of expertise, then they will most likely try to find a subcontractor, you guessed it, on alibaba.

I am sure there are good vendors on alibaba. But it seems there is a lot of carrot-dangling on alibaba as well. The prices that you see on alibaba are low, to be sure, but they are usually tied to very high MOQs. And my impression is that there are a lot of 3rd tier vendors on alibaba. These are very small vendors who sell primarily on alibaba and who do not attend big trade fairs abroad or in China. In other words, probably not vendors you would want to deal with.

I always think it is useful when you meet vendors on alibaba to ask them two questions:

1.) Do they attend trade fairs. Attending trade fairs is important because it tells you up front that the vendor is an established business with capital to invest, and very likely has some overseas customers. If they answer ‘yes” then ask them which shows. Then go to the websites of the shows they mention to see if they are listed on the exhibitor’s list. “Trust but verify.”

2.) Ask your alibaba vendor if they have a local website. If they do not or they tell you it is “under construction” then I would be wary about doing business with them.

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