alibaba guideAlibaba is the world’s largest B2B eCommerce website. Simply put, if a product is made, manufactured or mass produced, it’s available for sale directly from the manufacturer- through Alibaba.com. Whether you’re looking to start your own eCommerce business or sell products on Amazon or eBay, Alibaba is the place to get started.


In Part 1 of the mini series ‘The Complete Guide to sourcing products on Alibaba.com’, I’ll introduce some of the fundamentals concepts of using Alibaba.com

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What you should know about Alibaba before starting:

 

  1. Alibaba is based in China- So buy at your own risk!. You can’t threaten a factory in China, Pakistan or Bangladesh with legal action. If there’s a problem with your product, you have to work it out with your supplier or try resolving it through Alibaba customers service (good luck with that)[su_spacer size=”8″]
  2. Alibaba is not your typical eCommerce website – You’re not buying products from Alibaba. You’re buying them from a manufacturer who simply advertises/lists their products on Alibaba.com  Alibaba’s role is to help facilitate a transaction between the buyer and the seller.
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  3. Alibaba is NOT Amazon- When you buy a product from Amazon, it’s backed by Amazon. If you’re unsatisfied with your purchase or if the product is defective, Amazon will replace the item or refund you.  Despite their best efforts, Alibaba suppliers abide by the “buyer beware” mantra.
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  4. Alibaba is a B2B website – B2B stands for Business to Business.  If you’re not a ‘business’, don’t worry, you can still buy products through Alibaba. The important thing is to understand is when you source products through Alibaba, you have to buy in bulk or wholesale. You cannot buy single units of a product.

Why use Alibaba?

People who buy products through Alibaba do one of three things:

  1. Arbitrage
  2. Private Label
  3. Mass production/Manufacturing 
  1. Arbitrage- Means you buy a product and re-sell it.  Using Alibaba you can import a products in bulk and sell them on Amazon, ebay or through your own website. The problem with arbitrage is the profits margins tend to be razor thin since there are no entries to barrier and supply often meets demand at an equilibrium.  [su_spacer size=”8″]
  2.  Private label- A private label is taking an existing product and selling it under your name/label.  Private labels are EVERYWHERE. Walmart, Costco, Target, Macy’s, Best Buy are just some of the major retailers that use private labels to sell products under their name or under the “store brand”. These companies don’t manufacture their own products, they use the services of a private label who will make the product and place whatever label the retailers desires.
    [su_spacer size=”3″] One of the more popular (and profitable) ways of using Alibaba is to create your own label and sell popular products under your own brand.   More on private labelling in part 3(coming soon)[su_spacer size=”8″]
  3. Mass production/Manufacturing– Stuff is made in China for a reason. Cheap parts and cheap labor. Alibaba is a great resource to find manufactures who can mass produce just about anything.