Alibaba is the world’s largest B2B virtual marketplace, especially for small businesses sourcing abroad. Millions of buyers look at this site for their shopping needs and on the other hand, thousands of factories and resellers (mostly in Asia/China) have also made quite some business on Alibaba. It is a complex marketplace but as long as you find the right products along with an excellent marketing strategy, then you can still find your business thriving despite of the non-transparent trade and commerce environment.
Alibaba is a huge online marketplace and at the same time a trading platform where both sellers, wholesalers, distributors, manufacturers, suppliers, and scammers gather. In this wiki article, we will focus on common Alibaba scams and how you can help yourself avoid such costly mishaps. We all have heard a lot of tragic stories about businesses and consumers getting scammed on Alibaba which is why coming up with this article should be helpful for everyone’s cause. There is a reason that the Alibaba marketplace stays on the US government’s piracy blacklist for unsafe and counterfeit products.
5 Ways to Avoid Supplier Alibaba Scams
1. Be conscious of branded products
Alibaba scammers love to exploit popular brand names since these items are heavily popular among consumers and could easily attract attention. You can rarely hear of unknown brands getting counterfeited and sold to consumers. The ones which are almost always counterfeited and sold as if authentic items are popularly branded products. Always be wary when purchasing branded products from suppliers and always ask whether these merchants/suppliers are exclusive distributors of the said brands. If you know a given consumer brand, it is usually a red flag. It’s very rare to have legitimate offers of well-known brands. You can often see this when a factory is using product pictures that come from a brand’s website. Stay away from fakes since they are likely to get confiscated and you’re fined by customs upon import if checked.
2. Be wary of low quality electronic devices
If you are looking for importing electronic devices, you can find them all in Alibaba from Bluetooth speakers, mobile phones, car navigation systems etc. Simply search what you are looking for and you’ll face a huge variety of options of brands, sellers and versions of the product which you are looking for. The biggest problem for this is that due to the wide variety of choices, it will be difficult for consumers to detect products of the right quality. This predicament is the perfect opportunity for Alibaba scams to insert themselves. Cheap products are usually bad quality and you have to verify the quality ideally at the factory. A sample doesn’t have to be representative.
Low quality electronic devices are simply presented much like the legit electronic devices which means it requires extensive research for you to determine which electronic product/s is right for you. You don’t want to end up buying $1000s worth of appliances and go back to the website a few months later to apply for Alibaba complaints since most of the appliances are now broken and dysfunctional. Keep in mind, electronic devices are usually fragile and it is difficult to test its PCB and internal circuits for quality which is why these products are favorites for scammers to exploit (think of the famous power banks that are mainly filled with scrap metal instead of battery cells so that the capacity is much less than stated).
3. Buying at MOQ (Minimum Order Quantity) without receiving a sample
Even if you are only buying a low quantity does not mean you do not deserve an Alibaba sample of the product which you will purchase. You are still a customer who should enjoy the same privileges high volume sellers get. Getting an Alibaba sample is still the best way (of the few things you can do) to avoid Alibaba scams as it is the only way you can be assured to some extend that you are getting the product quality which you paid for. When trying to develop a relationship with Alibaba suppliers, always start from small increments of Alibaba small orders before moving up quantity-wise simply to build trust and confidence in your business relationship. If possible, visit the factory yourself or send someone from a third-party quality control company.
4. Gold Supplier memberships does not mean they cannot be Alibaba scams
There are isolated cases and news in Alibaba wherein the scammers involved in the controversy have Gold Supplier memberships. This development simply says the Gold Supplier seal does not mean you have to right away throw your full trust and confidence on the said supplier. Be judgmental and verify each supplier at the same rate and standards to protect yourself from possible Alibaba scams. Be wary of the fact scammers often come as a wolf in sheep’s clothing. A factory just has to pay for this status and submit a few basic documents. These can be fake, someone is impersonating this company, or the account have legitimate factory got hacked.
5. Neglecting your due diligence is dangerous
A big percentage of Alibaba sample scams occurred simply because the customer did not perform due diligence on his or her supplier. Your due diligence standards don’t have to be very complex. Simply visit the supplier’s website and check their company information or verify their contact details (you have their email? also call them). You can also check for testimonials and feedbacks from past clients and customers. If your supplier cannot present any history of transactions from past client then you can conclude there is something fishy and this supplier could possibly be one of those Alibaba scams. Also test the knowledge about their products.
Doing good business on Alibaba is feasible in general. However, no one is safe from Alibaba scams, especially if you are ordering at an Alibaba minimum order quantity because the factory doesn’t see much value in a long-term relationship. Protect yourself from Alibaba scams by being knowledgeable of how things commonly occur with Alibaba scams. Due diligence is always key in protecting your assets and business. It’s better and cheaper if you can build a relationship outside of Alibaba, because the prices tend to be higher there. Furthermore, direct private and white label product manufacturing allows you to customize your products at conditions that are better and safer than using Alibaba. Alibaba itself is often accused of having unfair businesses practises, to look away from the scam problems, or to use wrong numbers. Be careful!