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September 28, 2021
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6
min read
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Written by: 
Taner Idrisoglu

Successful supplier scouting in China: A guide for your e-commerce business

Everyone knows Alibaba. But while some small business owners already rack their brains during the initial communication, others get the best purchasing conditions with top quality via the online platform. Strong and reliable suppliers are essential for today's e-commerce. But how do you find these? In this article, we will help you to find your way through the wide range of ​​possibilities and give you an overview.


Step 1: How to successfully search for a supplier, online and offline

Online

The best-known sourcing platform is undoubtedly Alibaba. Alibaba was originally founded in 1999 as a B2B e-commerce portal to connect Chinese manufacturers with overseas buyers. With annual sales of $109 billion in 2020 and around 811 million active buyers on the marketplace every year, Alibaba is now the leading online retailer in China (Source: Statista, 2021). The alibaba.com site, with its filter options tailored for international trade, helps you to quickly and accurately find the right supplier from the endless selection of manufacturers. You select the desired values ​​for e.g. unit price, minimum order quantity and production time according to your needs and adapt the transport and payment options individually.

Bar chart showing the annual revenue of Alibaba in million yuan. Revenue 2011 around 12.000 and 2021 around 717.000.
Source Statista, 2021: The bar chart illustrates the growth (annual revenue increasing) of Alibaba Group Holding Limited from 2011 to 2021.
Screenshot of the webseite Alibaba.com
Source Alibaba, 2021: The product page provides an overview of the most important information (e.g. price range per unit, minimum order quantity, etc.).

Offline

Meeting strangers might be undesirable in times of the pandemic, but the fact remains undisputed that face-to-face contacts build closeness and trust much faster, which in turn is directly associated with better purchasing prices and payment conditions.

Many international manufacturers are already eagerly waiting to be able to participate in physical trade fairs again in the near future. European trade fairs such as AMAFEST.UK (Mar 11, 2022) and White Label World Expo (Mar 02-03, 2022) offer manufacturers a secure platform for exhibiting the latest products and technologies that they otherwise would be reluctant to publish online due to potential product piracy.


Nonetheless, traditional trade fairs are also not afraid to digitise their offers during the COVID-19 crisis. The Canton Fair, for example, has been taking place both offline and online since summer 2020 already. Thousands of Chinese manufacturers are presenting their new products via live video transmission. The next Canton Fair in the same format will start again on April 15, 2022. Other trade fair organisers attract virtual visitors with relevant keynote speeches and webinars. All in all, there is no lack of direct contact with manufacturers if you actively use the existing offers.

Step 2: Checking your selected supplier

Alibaba

Table showing the differences between Gold Suppliers and Verified Suppliers on Alibaba.
Source Alibaba, 2021: The table highlights the differences between a Gold Supplier and a Verified Supplier.

Alibaba is helping buyers through various means to make the buying process more transparent. For example, the platform awards “Gold Supplier” and “Verified Supplier” badges to eligible manufacturers. While being a Gold Supplier only means having an A&V (Authentication & Verification) and an on-site inspection, a Verified Supplier stands out with an in-depth inspection by an independent third party.

It is also possible to look up how long a manufacturer has been active on Alibaba and how fast the response time is. In addition, the number of supplier transactions carried out via Alibaba in the last 6 months and the punctuality of delivery dates in the last 90 days are also good quality indicators.

Processing the payment directly through Alibaba gives you the opportunity to take advantage of Alibaba Trade Assurance as well as Alibaba's quality inspections.

Other means of inspection

Of course, you can also have the manufacturers thoroughly inspected without Alibaba. Large retailers conduct regular "factory inspections" to ensure that the manufacturing facilities are generally able to produce the desired quality products. The ISO 9001 standards and the good manufacturing practice (GMP) defined by the European Commission (e.g. for medical products) could play a role here.

For smaller retailers, whose products can often be completed within a few days from a factory, product inspections, possibly including laboratory tests after production, are more suitable.

Step 3: Communicating with your new supplier

And now the most important thing: Once you have identified the right supplier, it is time to get in touch with him. You should ask all your questions regarding the production of your product and describe the product properties you have predefined as precisely as possible. It is important to talk in detail about the different materials, colours, and desired quality of the product. In order to leave a positive impression, it is advantageous to offer the prospect of a long-term partnership and to submit a business plan, for example how you want to increase the order quantity and expand the portfolio over time. Then have samples sent to you for your product and be in constant contact and lively exchange with your supplier in order to build long-term trust.

You can also contact the manufacturer directly via Alibaba and communicate details about the offer and your product requests via the platform’s message function. Many manufacturers also use Telegram or WhatsApp for fast communication. But no matter where the communication takes place, one thing always applies: respect is the basis for all successful cooperation.


Portrait of Account Manager Taner Idrisoglu
Taner Idrisoglu -
Account Manager at Myos


While Alibaba is the largest supplier scouting platform in China, it is not the only one. There are other portals such as globalsources.com or www.made-in-china.com - some also source directly from the Chinese version of Alibaba www.1688.com. As an alternative to the options mentioned above, there are marketing or sourcing agencies if you have the necessary budget and prefer to put the task in professional hands. All in all, there are many ways to find a suitable supplier for your e-commerce business and with this guide we hope we could give you a first overview of the most important aspects of the search.


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