Alibaba is the largest business-to-business marketplace across Asia. It connects international online distributors and importers with manufacturers. Even some Amazon and eBay sellers source products from Alibaba.
Many start-up businesses use Alibaba to:
- Purchase bulk products at a discounted price
- Import custom items cost-effectively
- Stock up price-sensitive items
Unlike DHgate, Alibaba hosts suppliers of industrial products, instead of daily consumer goods.
Similar to other e-commerce platforms, many start-up buyers are unsure of the website’s safety. Here, we will discuss what you need to know about that.
Is Alibaba Legit?
Being Asia’s—and in some ways, the world’s—largest online marketplace, Alibaba is a real and legitimate business. They host legit suppliers that you can really develop your business partnerships with.
However, some suppliers on Alibaba are not legit and they will scam you. For example, you may not receive your products after payment goes through. In such cases, Alibaba will investigate and ban that supplier.
You must also be able to research your seller to ensure their legitimacy.
Is Alibaba Good?
Alibaba is generally good and safe if you know how to avoid scams. Most suppliers on the platform are actually reputable and trustworthy.
The website has a rating of 4.59 from over 12 000 reviews, indicating that Alibaba is good to order from.
What Is The Safest Way To Pay on Alibaba?
Is Alibaba safe for credit card payments? If you are paying through Alibaba, then yes, your card information will be safe from fraud.
Alibaba uses AliPay to process credit/debit cards.
Alibaba safe for a credit card
Secure Payment is one of the safest payment methods available on Alibaba. If you make a payment using Secure Payment, Alibaba keeps your money in escrow until you confirm that you have received your products.
Escrow allows for protection for both buyers and suppliers. Your money is held in a separate account and managed by a third party.
This way, the supplier knows the money is there, and the buyer knows that the supplier will not get the money until the products are received and examined.
If there is any problem with the products, then you can dispute the payment and Alibaba may refund your money.
Paying through PayPal is also generally safe, but take care not to send money to an individual, but rather to a company.
Western Union is not recommended because it is easy to scam buyers through. You will not be able to receive a refund if you paid via WU.
Payment on Alibaba
Is It Safe to Buy Products From Alibaba?
Ordering from Alibaba is generally safe.
You just need to know what to do when looking for a potential supplier.
Does Alibaba Have Buyer Protection?
Alibaba offers buyer protection in the form of a Trade Assurance.
What is a Trade Assurance?
A Trade Assurance is Alibaba’s own platform for placing orders and managing payments. If the supplier accepts TA, then you can have a little more trust in that supplier. When orders go through Trade Assurance, you will get protection for your order payments.
Alibaba has strict rules to keep transactions secure, but you should be informed either way.
Trade Assurance is free for the buyer, and it places fees on payment methods other than Secure Payment. This is to deter suppliers from scamming buyers.
Also, the amount of the TA order affects the supplier’s Alibaba ranking. The higher the amount of the order, the more visible the products published by the supplier will be.
However, suppliers can use schemes to increase their TA rating dishonestly.
Does Alibaba Sell Fake Products?
Unfortunately, just like many other e-commerce sites, Alibaba has suppliers that sell counterfeit items.
Most commonly, DHgate suppliers sell fake branded Xboxes, Apple Products, and fashion clothing.
If a deal seems too good to be true, like Gucci apparel for $10, this is a scam.
You should also keep in mind that reselling fake branded products is illegal, especially in the US. Thus, be careful when buying from Alibaba.
Can I Get Scammed on Alibaba?
As mentioned, Alibaba is just a platform for connecting B2B, so the website does not scam the buyers. However, individual sellers may engage in a variety of scam. Some of the most common scams include:
- Selling branded counterfeit items
- Increasing the quote after you place an order
- Providing a high-quality sample, but poor-quality order
- Faking certificates
- Shipping wrong, but similar products
- Not shipping products at all
- Registering an off-shore company
While other points may make sense, let us explain the last one.
To increase the number of trade assurance orders, some Chinese companies register foreign companies. Then, these suppliers order products from themselves to improve their ratings and image.
Below you will learn more about how to avoid this and other scams, so keep reading!
Scammers are everywhere, but Alibaba can immediately blacklist and ban scam seller accounts.
You can also consult Alibaba Scammer Lists and Supplier Blacklist. Additionally, you can run a google search for recent Alibaba scam forums.
How to Find a Legit Alibaba Supplier?
Finding a legit and reliable supplier on Alibaba requires some dedication and research. If you follow the advice below, your chances of getting scammed will be minimized.
- Check for a Gold Supplier status.What is a Gold Supplier status on Alibaba?It’s a premium, paid account for suppliers, costing several thousand dollars per year.While this status does not always indicate a legit supplier, but know that scammers do not usually pay for this status.Be careful with free Alibaba accounts, because scammers prefer these.
Also, there has been a fraud when scammers hack or buy Gold Supplier accounts off of businesses that are closing.
In these cases, such accounts would try selling a lot of random branded items, and there would be a noticeable change in the products published before and after.
But, generally, Gold Supplier status is a good indication.
Gold Supplier status
- Check how many years the supplier has been on Alibaba.
If you find a supplier that has been on Alibaba for 5+ years, you can be sure that this is an established, real supplier.This is because scammer accounts get caught and banned fairly quickly, not lasting for more than a couple of years.
- Stay away from deals that seem too good to be true.
If a supplier is trying to give you products for free, or offer free delivery, know that this is likely a scam.
- Use the Verified Supplier filter.
Using this filter will also give you a good indication of which suppliers are trustworthy on Alibaba. However, if your product is very niche, not many good suppliers will have a “Verified” badge, so keep that in mind.The verification of a supplier is done by a third party inspecting company. For example, SGS, TUV SUD, and others. Verification involves checking:
- Company profile
- Enterprise qualification
- Business scope
- Product R&D
- Quality assurance
- Cooperative factory
- Aftersales service
- Factory audit video
- Check the supplier’s legal status.
If a supplier on Alibaba has the “legal status checked,” then Alibaba employees have verified that the business exists in real life. However, this only implies that the physical place exists.
- Check transaction history.
Transaction history is indicated by the small, orange diamonds next to the supplier’s name.These indicate how many sales a supplier has done on Alibaba: the bigger these numbers are, the better.
Transaction history score
- Check ratings and reviews.
Generally, the more reviews, the better. Also, read through any bad reviews to see what potential problems the manufacturer has. Watch out for the following:
- Low product prices and complaints about low quality
- Reviews of defective parts
- Complaints that the first shipment was good, but the second shipment was not
- Poor working conditions in factories
- Check supplier’s certificates.
Many suppliers will show the scanned certificates for their products, their manufacturing facility, and other parts of their business. This provides further proof that they are a genuine supplier.There also may be products requiring specific certificates for legal import. Make sure that your potential supplier complies with them and can prove that.Now, it could be the case that the certificates are fake. If you want to check, contact the company that issued the certificate and ask for a confirmation.Usually, you can do that quickly and for free online. For example, you can contact SGS to verify industrial certificates.
- Check trade show attendance.
Look for indications that the supplier attends trade shows, like the Canton Fair.A genuine Alibaba supplier may post pictures or videos from the recent show.Scammers do not attend trade shows.
Trade show attendance
- Check the supplier’s factory videos.
If a supplier has a video on their Alibaba account, watch it! It may be produced by Alibaba, in which case, you can be sure that the company is legit.If the video is produced by the supplier, look for their custom signs. Things like logos, specific goods, etc. Watch out for generic footage of office buildings and random factories, as well as for stock photos.
- Check Global Sources.
If the company has a verified profile on Global Sources, then you can be sure that the supplier is legit.This is because Global Sources takes its verification process very seriously and has extremely strict requirements for authentication.
- Check the supplier’s website.
Another piece of advice: look at the general formatting of the seller store page.If it is personalized, then it is likely to be a responsible seller. However, some sellers leave the page in its stock format, and that may be indicative of an inexperienced or irresponsible seller.You can also visit the company’s official website, if it exists. Bonus points if the website is in English—this indicates that the company is partnered with businesses globally.
Example of good website
- Check product categories.
If a supplier has many different product categories (e.g. home decor and electronics), this is a sign that the supplier is either a trader or a scammer.A manufacturer will offer you a better deal than a trader, so if you are looking for a long-term supplier, a manufacturer is better.Legitimate and established suppliers often have a niche of products within one category. This indicates that the manufacturer specializes and is an expert in one area.
- Check return policy.
It is recommended that you always ensure that the supplier has a return policy before placing the order. This protects your order and it will be easier to get a refund if something goes wrong.
Alibaba is an e-commerce website that focuses on connecting suppliers of industrial products with large and medium-sized businesses.
Can you safely buy from Alibaba? Yes, you can. However, you should be careful about choosing your supplier because you get scammed.
Alibaba is legit and safe to order in bulk from. It is also safe for credit cards and debit cards. Its Secure Payment and Trade Assurance systems are highly reliable.
We have also compiled a similar guide about AliExpress and about DHgate, so feel free to check them out and start your dropshipping wholesale business!