How does Alibaba work? Buying, shipping, top tips

Alibaba is a global online marketplace that offers low prices for business supplies in more than 190 countries.

The wholesale online marketplace entices businesses from all over the world. Alibaba offers discounted bulk rates and encourages negotiation with sellers to get the best price.

There is a minimum order when buying from Alibaba, so it’s best for bulk purchases.

The site aims to streamline the process of buying wholesale. So how does Alibaba work? Read on to learn more.

Pay Alibaba vendors with Wise

📝 This article will cover:
How does Alibaba work? What does Alibaba sell? Ordering from Alibaba Alibaba shipping Alibaba pros and cons Alibaba vs AliExpress Pay international suppliers with Wise

How does Alibaba work?

Alibaba is a wholesale business-to-business (B2B) platform. This means it’s a business that sells in bulk to other businesses, rather than individuals.

This is what sets it apart from online retailers such as Amazon, which are business-to-customer (B2C) stores.

Alibaba Group, the multinational company behind the Alibaba website, is based in China.

Most of the businesses that buy goods through the Alibaba marketplace are retailers and sourcing agents. They go on to resell or private label the products.

Alibaba has several measures in place to protect payments. There’s the secure payment portal, for example, which means any sensitive card information you enter will stay private.

Can anyone buy from Alibaba?

While anyone can buy from Alibaba, there is a minimum order amount for purchases, meaning you can’t buy a single product. The minimum order amount will depend on the product you’re looking at. It could be in the region of 500 pieces, for example.

As a result, it’s businesses that use Alibaba most as an affordable wholesale supplier.

How to buy from Alibaba without a company:

It is possible to buy from Alibaba, though, even as an individual.

If you don’t have any intention of starting a company, then here is how to buy from Alibaba without a company:

1. Sign up to Alibaba by heading to the website and clicking the ‘Join Free’ button.

2. Type in your email address. Bear in mind that you could receive a lot of emails from suppliers, so it might be best to use an alternate address.

3. As you fill out your personal information on the next page, you can enter your name or anything else in the ‘company name’ field. Since Alibaba has no verification process for businesses that buy from the site, it doesn’t have to be an official company.

What does Alibaba sell?

Unlike online B2C stores, Alibaba doesn’t sell single items.

So it begs the question, what does Alibaba sell?

As a wholesale marketplace, it is instead a place for businesses to go to find vendors that offer bulk supplies at low rates.

The majority of vendors on the platform sell export items sourced from China. The most selling products on the store include electronics and beauty supplies.

Other categories include machinery and vehicles, lights, and sports equipment.

Ordering from Alibaba to the USA

While Alibaba mostly relies on Chinese manufacturers, you can still have goods delivered to the USA. In fact, you might even get lucky and find vendors that are based in the States.

Ordering from Alibaba to the USA can be complicated. In most cases, there are several steps you’ll need to take to receive your order. If you want to keep things simple, then you may have the supplier make arrangements for the shipping. You can pay them any extra charges the process incurs on the invoice.

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To make payments easier, you can use an international payment service, such as Wise. With the Wise Business account, you can pay for your goods and shipping in the local currency, with no hidden fees. What's more, you can keep all your currencies in one easy-to-manage account.

Find out more

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Shipments are transported either by air or by sea. If you want to organize it for yourself, you’ll need to check for duty fees on goods, as you may be subject to extra charges. Generally speaking, smaller items will be transported by air, while heavier loads will come via sea or air freight.

Unfortunately, given the distance between China and the USA, it isn’t cheap to have things shipped.

Cheaper shipping options are available, but these will take longer. Always check the shipping time estimate to make sure your delivery arrives when you need it.

✈️ Use the US import duty and taxes calculator to calculate the charges you'll need to pay when bringing goods into the US!

How does Alibaba shipping work?

When you buy from Alibaba, there are two options for shipment:

• The first, as mentioned above, is to pay the vendor extra in the invoice to take care of the shipping logistics.

• The other option is to arrange the shipment yourself.

How does Alibaba shipping work if you want to take care of it yourself?

If you want to go it alone, your best bet is to work with a freight forwarding company, paying them to organize the delivery of your shipment.

A freight forwarder is an intermediary, either a company or an individual, that steps in to help arrange the delivery of a shipment.

Alibaba provides useful logistics information which details the shipment options available to you.

For example, customers can ship to 35,000+ US zip codes with either Less-than-Container Loads (LCL) or Full Container Loads (FCL). These shipment options depend on the quantity of the Alibaba products you need to send.¹

💡 If you need to pay international shipping in a different currency, you can use Wise Business. Pay suppliers in their local currency and avoid hidden fees.

Alibaba pros and cons

Alibaba is one of the leading online wholesale marketplaces, but how does it measure up against the competition?

If you’re looking for an overview of the online store at a glance, here’s a brief list of some pros and cons:

Pros

• There is a wide selection of products on the site spanning various categories
• The prices for bulk orders are low, and negotiable with the vendors
• With so many products and vendors, businesses can compare and find the best deals

Cons

• You may not know what the quality of the product is like unless you pay extra for a logistics agent to examine them
• International shipping can be expensive and time-consuming

Alibaba vs AliExpress

AliExpress is another online retail service based in China, also owned by the Alibaba Group.

AliExpress and Alibaba have a reputation as leaders in the eCommerce industry that retailers like Amazon have in the USA.

However, AliExpress offers a slightly different proposition than Alibaba.

While Alibaba is mostly for bulk purchases, AliExpress allows customers to buy products in small quantities. As a result, the latter can be considered as both a B2C and a B2B service.

AliExpress does also offer bulk ordering, though, and when you order in large quantities you’ll usually be offered a discount.

Another difference is that AliExpress operates like a standard eCommerce site. Alibaba is more of an intermediary.

With Alibaba, you’re entering a virtual online marketplace where each vendor can be bargained with and negotiated down to the best price.

For businesses big on brand identity, Alibaba allows customized products with branding labels. This isn’t the case with AliExpress.

However, if fast delivery is your priority, then AliExpress may be the better option since it sells manufactured products.

Save money when you pay international suppliers with Wise

Now that you know how Alibaba works, you can start using the wholesale platform. There is one last thing to bear in mind though - paying for your goods and shipping.

When it comes to making international payments, the last thing you want is to get hit with hefty currency conversion fees.

After all, the costs of shipment alone can add up, so it’s in your interest to find an affordable payment solution.

Pay vendors with ease - try Wise

With Wise Business, you can cut costs when paying international suppliers from Alibaba, as you pay them in their own currency at the real mid-market rate.

Looking for the best wholesale site for your business? You can also read the Tundra Wholesale review to see how it compares.

Sources:

1. Alibaba Logistics

All sources checked November 4, 2021.