Based on our experience using Alibaba.com and other B2B supplier directories to import product from China, and working with Chinese factories to import lots of different types of products, we have reviewed the top five issues we encounter and how to navigate those issues.
1. Traders Claiming to be Manufacturers
Many suppliers will wrongly claim to be manufacturers. Sure you can ask the question, but you may not bank on the response being accurate from all suppliers. Our programs provide tips for filtering down to a handful of well suited Chinese factories, however one thing you cannot do from your desktop is on ground verification in China. We encourage our members to arrange a factory inspection prior to payment to verify equipment, people and processes. Or just go to China, and get support visiting the factory.
Many Chinese trading companies are actually very good to deal with, but two issues you may have are:
- Risk of low quality materials and craftsmanship if margins are tight
- Harder to resolve production and quality issues – you are not liaising direct with the decision maker in the factory
2. Transfer Funds Securely and Safely
In order to avoid risk of payment, use secured payment methods. PayPal is used for low value amounts and offer some recourse for buyers. Unsecured methods leave you zero recourse if payment is not received, and also little leverage to address an order with legitimate suppliers if there is an issue with production.
Unsecured payment methods generally offer better exchange rates and less fees, and can certainly be used after supplier is properly verified.
3. Avoid Importing Global Brands – Unless there is Proof of Authenticity
Be wary of suppliers advertising globally branded goods when buying products online from China. Like B2B suppliers anywhere, Chinese manufacturers and vendors need approval from brand owners to resell goods.
There are three risk areas for importing counterfeit goods:
- Passing customs and confiscation
- Product is unlikely to be the same quality as the global brand
- Legal action by the brand owner
4. Invoice Omitting Agreed Details
An increasing tactic that is used by a small number of suppliers is omitting critical information from the invoice, despite what was previously agreed.
The most common issue is shipping terms. Despite what was agreed or even displayed online, invoice displays ‘Shipping Terms TBA’ – the supplier will then switch to Ex-Works and importer must then pay for transport of goods to the port in China. Our programs provide detail about spotting and managing these risks in detail.
5. Product Materials Changed
Manufacturers in Asia export different quality products all over the world. Some markets accept lower quality materials and craftsmanship, some demand high quality. So it is quite normal to receive samples with below par materials from a decent manufacturer.
If not specified in detail, a production order may use lower quality materials then you expect, or the odd dubious supplier may substitute for lower quality materials. However, reliable suppliers will inform you of any changes in specifications before manufacturing the ordered products.
Review of Alibaba
My Import Label is the perfect tool to use in conjunction with Alibaba, because it provides you the tools and know how to better select products and suppliers online from China, then import your own brand products safely and effectively and launch to market.
by Ben Crawford Top Five Issues – Review of Alibaba.com