Learn how to NOT get scammed when dropshipping with Aliexpress and importing from Alibaba.
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Here are 4 tips for not getting scammed when importing from China with suppliers on Aliexpress & Alibaba.
Tip #1: Work with suppliers that have been online for multiple years
This is the absolute, easiest way to protect yourself from getting scammed. If a supplier has been on Alibaba/Aliexpress for 2-3 years and been scamming people by taking their money and running, they would have been removed by now.
China enforce very harsh rule for criminals (they’re ranked 5th in the world for enforceable contracts). Any company with history that could be easily tracked by the law enforcement is unlikely going to risk a harsh prison term for some quick cash.
The great thing about Aliexpress, is you can see how long a supplier’s been online for. Because you’ll be buying items individually on Aliexpress, working with suppliers who have been online for 2+ years is usually more than enough to safeguard yourself.
With Alibaba however, you’ll be purchasing orders in much larger quantities, so it makes sense to go that inch further. In that case, we recommend purchasing from suppliers who have had a gold subscription for 3+ years. These subscriptions cost thousands every year to maintain, so chances are a scammy supplier wouldn’t be subscribed to this.
Tip #2: Be wary of suspicious payment methods
The biggest red flag is if a supplier asks you to pay in a suspicious way. As a beginner in dropshipping, stick to ordering via Aliexpresses checkout system.
As your dropshipping business grows, you may move to a different system called CSV bulk dropshipping. This when you download all of your orders from your Shopify store in a CSV format, and send that file to the dropshipper. They’ll take that data, and then fulfill all of the orders for you off Aliexpress.
For Alibaba: Stick to paying for orders via Paypal or wire transfers to banks in mainland China . And if a supplier asks you to pay via Western Union - DO NOT work with them.
Tip #3: Protect yourself against faulty products
Unfortunately, quality control issues are an unavoidable part of the dropshipping business. To protect yourself from this, only work with suppliers who have a good history of shipping out the product you’re selling. Looking at the product reviews is a great indicator for this, as it shows people have had an excellent buying experience with the supplier.
For Alibaba, one way you can protect and safeguard yourself is to pay for an order with PayPal.
If you do this, then you are protected by PayPal’s Dispute program. If you receive bad products, then you know that if you can’t work out some form of compensation with your supplier, that you’ll be able to claim a refund with PayPal.
Here are some additional tips:
#1: Identify your supplier is part of the Trade Assurance program
If they are, they’ll have the Trade Assurance icon on their listing, which tells you how much you can be protected for if you purchase products through them.
#2: Negotiate with the supplier & create your contract
Make sure you agree on ALL aspects of your order. Including price, shipping dates, and the terms you’ll be covered under Trade Assurance.
Also ensure your contract includes expectations for your products. For example, the size and materials they should be made out of.
#3: Pay for the item through Alibaba
Pay with a telegraphic transfer (e-checking if you’re in the USA). Paying with credit card is also an option. It has fees, but provides you with an additional layer of protection due to chargebacks.
Tip #4: Get your products inspected
This is more targeted towards Amazon FBA sellers who do Private Labelling. Since you’ll be buying in bulk, it makes sense to inspect orders before shipping them to the Amazon FBA warehouse.
If a product doesn’t pass the quality inspection, you can negotiate with your supplier to fix the problem, or worst-case-scenario, file a dispute with PayPal or Alibaba. Alibaba offers a service that lets you organize an inspector through them, which costs around $200.