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Is Alibaba Good for Dropshipping? Here’s the Guide for Alibaba Dropshipping

Blog, eCommerce Insights | November 5, 2020

So you might be getting prepared to launch your amazing new dropshipping store or simply might be looking for the best dropshipping supplier. But where do you start? Many of the bigger Chinese manufacturers and suppliers have a wealth of products on offer, but what about the small print?

 

So it might be time to ask yourself, is Alibaba good for dropshipping? And maybe other questions about finding the best cheapest and most reliable supplier for your dropshipping enterprise.

 

Let’s start by nailing the brief, then we can look a little more closely at this important dropshipping topic.

 

Is Alibaba good for dropshipping? Although Alibaba is one of the largest suppliers of manufactured goods and works well for some eCommerce stores. AliExpress and others may be better for your needs. Choose a reputable and reliable dropshipping agent who can find a supplier, help with inventory, and all your dropshipping requirements.

 

What is Alibaba?

Alibaba is a wholesale marketplace where you can buy products in bulk and is one of the largest wholesale websites available online.

 

You might be surprised to know that Alibaba is bigger than the combined force of both Amazon and eBay and connects Asian and Chinese suppliers with eCommerce store owners from right across the world.

 

Alibaba is responsible for filling the physical and virtual online selves of countless brands across the globe.

 

How do I buy from Alibaba?

In our modern global marketplace, it’s never been easier to find a manufacturing or wholesaling partner halfway around the world.

 

We understand how sourcing your products from overseas can still seem like a daunting task for many new online entrepreneurs and dropshippers.

 

You might have many questions, such as where do I start? What should I pay attention to? How do I protect myself from scammers? Let’s find out.

 

  • Browse the directory Buying on Alibaba and using the directory is a fairly straightforward process and is similar to other marketplaces like eBay, for example. You can search for a specific product or simply browse the product categories.
  • Product descriptions One of the first things you’ll likely want to look at is the price. Some descriptions will have the letters FOB next to the price. This is Free On Board and shows that the seller will pay the costs associated with getting the product to the marine port, which is the cheapest method of delivery.
  • MOQ Minimum order quantity Although most descriptions will show a high MOQ, these are usually more often than not, negotiable with the seller.
  • Payment options Once you have chosen your product, do a thorough check on the payment options available. Some sellers will only deal in bank transfers or western union, which do come with an element of risk. PayPal is the safest option.
  • Verify suppliers Alibaba has its own verification program which shows specific levels sellers have achieved. The badge to indicate this will be on the seller’s profile. Alibaba also offers an independent 3rd party service which is located in Asia This is an extra cost, but for those ordering in large quantities, it will give you peace of mind of the supplier’s product quality.

 

How to source on Alibaba and find suppliers

So you can make sure you make the best choices on suppliers for your dropshipping eCommerce store, we recommend that make sure you spend some time researching the following:

 

  • Quality Although many Alibaba sellers will advertise their products as being ‘high quality’ there can be a huge difference between what we may think of as high quality and those from Alibaba suppliers. New eCommerce stores have a reputation to build, so it’s important to source high-quality products in order to offer your customers a superior product that they might not get from competitors online stores.
  • Price Make sure you search thoroughly to make sure your product isn’t being offered more cheaply from other sellers and make sure you understand that Alibaba charges a commission of 2% to 5% for each transaction.
  • Delivery Slow delivery times can cause many customer issues and give a negative spin to your reviews, which will influence new customers, so it’s important to fully understand the delivery times attached to any products.

 

Now let’s take a look at the advantages of using Alibaba as a dropshipping supplier.

Advantages

Huge range of suppliers and manufacturers to choose from. Alibaba.com is one of the biggest B2B marketplace online for global wholesale trade. There are 40 categories from consumer electronics, clothes, toys to beauty products, home & garden, and many more. Sellers there are vetted and familiar with wholesale trading.

 

Low and affordable prices. Alibaba sellers are either factories or trading companies. You can purchase bulk wholesale products directly from manufacturers, so the price is incredibly low compared to other marketplaces.

 

Design your own custom-made and private label products. Factories on Alibaba.com are willing to produce bespoke products and customized packaging.

 

Disadvantages

So although we’ve discovered that Alibaba is one of the biggest wholesalers and there are many ways dropshipping with Alibaba could work well for your eCommerce store, as with any kind of business, there are disadvantages.

 

Let’s take a look at some of these below.

 

Payment options are limited. Alibaba accepts credit card, online bank transfer, west union, line of credit, and wire transfer. PayPal is not an option.

 

Low payment security. Many dropshippers are more

 

MOQ (minimum order quantity) is high. Many Alibaba sellers request high MOQ such as thousands, which is a big upfront investment for dropshippers.

 

Perceived lower quality from customers. Without quality control, the defective rate might be higher than expected.

 

Longer delivery time. Usually factories take order then arrange for production. After that, factories ship products via ocean freight for reduced cost.

 

Language and cultural barrier.

 

What is the difference between AliExpress or Alibaba dropshipping?

So you might have heard of AliExpress and wondering if you should use AliExpress or Alibaba for dropshipping?

 

In short, AliExpress is Alibaba’s retail arm, which gives dropshippers and eCommerce store owners the chance to buy in smaller quantities but at a higher price.

 

Let’s find out a little more to help you make a decision.

 

  • Price Alibaba offers lower prices, whereas AliExpress prices are higher. If you are planning to sell large quantities, stock an inventory and waiting times aren’t an issue, then Alibaba might be the best solution.
  • Bulk AliExpress has multiple sellers offering similar products, but mainly Alibaba requires items to be purchased in bulk and only has a few suppliers offering the same products
  • Product ratings Alibaba has a function for users to rate both products and sellers, On AliExpress only the products are rated.
  • Shipping As Alibaba is for B2B wholesale trading, ocean freight is much used; AliExpress sellers use ePacket a lot. Both of them are quite slow and inefficient.
  • Dropshipping AliExpress is more geared up for dropshipping than Alibaba.
  • Convenient AliExpress is a more convenient option than Alibaba

 

So now you’ve seen the main differences between these two heavyweights, and have seen they both have drawbacks, you might still be wondering if there’s a better solution for sourcing products for your eCommerce store?

And finally…

As we’ve seen above both these two Chinese manufacturing giants have plus and minus points and it can be a minefield trying to navigate your way through the benefits and negative aspects of both Alibaba and AliExpress.

 

If you decide not to purchase bulk inventory and expect a faster shipping, AliExpress is a better option than Alibaba, as AliExpress sellers are familiar with dropshipping requests. While bear in mind that AliExpress dropshipping has fallbacks such as the unreliability of ePacket and immobility of customization.

 

The best dropshipping solution

Those looking for a more professional solution to their dropshipping sourcing needs, from choosing the best quality and profitable inventory, warehousing, and right through to finding the best shipping rates, work with reputable drop shipping agents.

 

Advanced sellers are enjoying the benefits of working closely with reputable, experienced agents, able to offer a full solution to make sure your eCommerce store has the best chance of success above and beyond those of your competitors.

 

“Advanced sellers are enjoying

 the benefits of working closely with reputable, experienced agents.”