Buying products from Alibaba and selling on Amazon has become one of the most favored processes because of the convenience factor and profit margins. Alibaba, the Chinese e-commerce giant has become a highly coveted product sourcing option for sellers from all over the world.
Alibaba provides sellers with a massive database to choose manufacturers and suppliers that suit their needs within a quick time frame. Its primary function is to bring together buyers with manufacturers and wholesalers.
If you’re a seller pondering over how to sell Alibaba products on Amazon, this article is aimed at solving all your queries and concerns so that you can make informed buying decisions.
Product sourcing From Alibaba to Amazon FBA is one of the building blocks of your Amazon sales. This is because it entails high profits for sellers owing to the extremely low prices of products in the Chinese marketplace as well as other markets around the world. SellerApp has partnered with Alibaba to simplify your product sourcing process even further.
You may be a seller with brilliant product ideas but without a strategy in place for product sourcing, it can become very difficult to take your Amazon FBA business forward. This is where Alibaba comes into play because you can choose from various suppliers of different price ranges. But you need to be wary of fraudsters and fake suppliers as it is a major concern among sellers who use Alibaba for sourcing their products. This concern too will be addressed as your progress through this article.
Whether you’re searching for economically priced products or the right manufacturers for your products, Alibaba facilitates eliminating the intermediaries. It allows for easy communication directly with wholesalers and manufacturers.
Your entire selling process begins with finding the right product. SellerApp offers tools to help you with product research. Your research should focus on finding products that have good potential to generate high-volume sales. You should be able to source it at low costs and be able to sell it at a price that earns you a good profit.
Recommended: How to do Profitable Amazon Product Research.
Make use of Amazon Best Seller lists and analyze competitor products for more insights. Additionally, focus on product niches that are not too saturated to avoid going head to head with multiple other sellers. Especially if you are a novice seller, you should try and find a gap in the market, so it will be easier for you to break in and start earning profits. If you are still finding it hard to identify what products you want to sell, SellerApp has a tool to provide you with ideas for products.
To know about SellerApp’s freemium click here.
Additional Read: What are the most popular products to sell on Amazon?
Once you have decided on what products to sell, you can then head over to Alibaba.com and start looking for manufacturers and suppliers. Decide what price range you want to set for your products. You can then start looking for quotes accordingly and narrow down your search for suppliers that fit within your price range.
Additional guide: What are Amazon Ads Certifications?
You can also conduct your search by looking for suppliers instead of products if you’re looking for a more specialized, expert manufacturer.
You can pay suppliers through different payment methods on Alibaba. Alternatively, you can also settle payments outside of Alibaba depending on the terms that your supplier agrees to. Be mindful of the fact that there are several fake suppliers, so paying outside the platform is even more of a risk as it will be all the more difficult to hold anyone accountable. It will also be deemed illegal when you make payments through other portals that do not fall under the international transactions category.
Here are some of the popular payment options that Alibaba offers
This method is the fastest but entails a high level of risk especially when the whole payment is made before the start of the production process. So the best thing to do is pay part of the amount in the beginning and the rest after you receive the shipment. You need to ensure that you have all the correct information related to the supplier, like his name, personal and bank address, bank identifier code, etc. The downside to this type of payment is that there are delays in processing (usually 3 days to start the process as well as delays due to holidays) and there is a slim chance of getting your money back in the event of any problems.
This is a suitable payment method if you’re dealing in large order quantities, typically above $20,000. It is the most effective way to acquire products that are of the stipulated quality. It also guarantees payment to the supplier owing to the documents involved in this mode of payment, which consist of clearly stated terms.
Escrow, which is now called the Alibaba Secure Payment service, is a low-risk level payment method. In this, a buyer’s payment is held until he receives and approves the order being delivered according to adequate standards. This method works in favor of both buyers and manufacturers as it ensures the satisfaction of buyers concerning products’ conditions while suppliers are guaranteed secure payments.
If product quality or delivery is unsatisfactory for some reason, then the suppliers will not receive payment from the buyer until an inspection is conducted.
PayPal is another low-risk level payment method especially with regard to international transactions. It is known to offer secure payment protection to users, it is not complex to use and there are no delays in the transfer of payments. The only limitation is that it doesn’t offer equal convenience to suppliers owing to high tax rates and other difficulties associated with money withdrawal, but you can count on PayPal to assist you with getting your money back in the event of any mishaps.
Alibaba Trade Insurance is another payment option that aims to protect buyers. It is applicable only so long as you use the secure payment gateway on Alibaba.com and not through any outside channel. This option compensates for any losses you may incur in case of delay in shipping time, damaged or wrong products, etc. It protects buyers from fraudsters and ensures refunds. The problems with Trade Assurance are that all suppliers are not willing to participate in it and the ones who do, have higher prices for products as a result of partaking in this policy method.
Now that you know the basics of how to sell on Amazon from Alibaba, it would help to know some profound safety concerns. Alibaba is a well-known marketplace that eliminates the middlemen or at least tries to because there are a lot of fraudster middlemen that one may find who are not manufacturers but actually resellers.
There are a lot of procedures in place to safeguard both buyers and manufacturers.
Even though Alibaba is a reputable sourcing option there are some risks involved mainly involving fraudsters, scammers, and payments frauds. You need to look out for products that have below-par quality.
All the factors, risks, and information provided above are meant to give you a clearer perspective on sourcing products from Alibaba to sell on Amazon FBA. As an Amazon seller, you need to be wary of the quality of products you’re sourcing and not compromise on it while also ensuring good profit margins. Keeping all these points in mind, you are better equipped to run your Amazon business.