Avoid Alibaba Scams & Find Legitimate Suppliers.

Alibaba is one of the biggest global marketplaces for sourcing products from China but many businesses worry about scams, fraud and unreliable suppliers. Whether you're an eCommerce seller, dropshipper or retailer, knowing how to vet suppliers properly can save you thousands of dollars and prevent headaches.

Are There Scams on Alibaba?

Unfortunately, yes scams exist. Some suppliers sell low-quality products, fake goods or even take your money without delivering anything. However, you can avoid scams and find trustworthy manufacturers. 

1. Check for Verified and Gold Suppliers

Alibaba offers verification badges such as "Gold Supplier", "Verified Supplier", and "Assessed Supplier". These badges show that the supplier has passed a third party inspections which help reduce the risk of fraud. 

It is important that you do not rely solely on these labels, you must continue to do further checks. 

2. Request Business Licenses and Certifications

Legitimate suppliers should be able to provide you with business licenses, certifications, and product compliance documents. If a supplier refuses to share these, it’s a red flag.

We once encountered a supplier who on paper seemed like the perfect fit - competitive pricing and glowing testimonials. When we scheduled a factory audit we were met with several red flags.

They were unable to show us their certifications and documents. Why? Turns out he didn't own the factory. He was a middleman representing a friend's cousin who actually owned the factory but didn't speak English and was desperate for new clients. This was a huge red flag. It meant the person we were dealing with had no real control over production timelines, quality assurance, or even potential labor issues like worker strikes.

3. Avoid Unrealistic Prices

If a product is priced significantly lower than competitors, it may be too good to be true. Scammers often catch people's attention with cheap prices and then disappear after payment.

We have all been there. We personally have tested so many suppliers in our decades of experience, and finding an unrealistically cheap supplier has only ever led to bad results.

The issues have ranged from poor quality products, worse quality assurance, manufacturing inconsistencies and unexpected delays. In some cases the product or sample never even arrived. One supplier offered pricing that was almost 40% lower than the competition, and while we were excited about the quote, it ended up costing us far more in lost time and frustration.

Just like in most aspects of life, if it seems too good to be true, it probably is.

4. Use Alibaba Trade Assurance

Alibaba's Trade Assurance protects buyers by holding payment in escrow until goods are received and confirmed to meet your agreed specifications and quality. Always prioritise suppliers who accept Trade Assurance payments to avoid any short or long term financial losses.

5. Verify Supplier Contact Information

Check if the supplier has a company website, physical address, and multiple contact methods (phone, email, WeChat, etc.). Avoid suppliers who only use personal emails (e.g. Gmail, Yahoo) instead of company domains as this is a common red flag.

A reliable manufacturer should be willing to provide a video call or factory visit to verify their factory. If they avoid direct communication or insist on rushed payments, proceed with caution.

One trick we use is cross checking their business and personal details on business directories, LinkedIn, and Google Maps. If their address leads to an empty lot or unrelated business, it’s a clear sign something isn’t right. It is simple but effective! 

6. Order Product Samples First

Before placing a bulk order you should ALWAYS request a sample. This helps you see the manufacturer's product quality, shipping speed and reliability.

At J&H Group, we NEVER make an order with our manufacturers until we have received a sample from them that meets all of our specifications. 

There have been times where we worked with a manufacturer before but their new sample did not meet our quality assurance standards. If we had gone straight into a bulk order we would have been left with unusable stock, delayed shipments and upset customers.

The cost of a sample product is very small compared to the potential losses from a low quality bulk order with high defection rates. Taking the time to verify samples has helped us avoid expensive mistakes and maintain our high quality sourcing.

7. Beware of Fake Reviews and Ratings

Some suppliers buy fake reviews to appear reputable. Look for detailed reviews with images and videos from verified buyers rather than just five-star ratings.

Some suppliers buy fake reviews to appear more trustworthy. Look for detailed reviews with images and videos from verified buyers rather than just five star ratings or generic reviews. A good sign of a real review is when they mention specific product details, shipping experiences etc. 

Another red flag is when all reviews are overly positive with no small complaints, genuine buyers often leave balanced feedback. Compare reviews across different platforms like Trustpilot and Alibaba to check for consistency.

One method we use at J&H Group is reaching out to previous buyers directly if possible. If a supplier is hesitant to connect you with past clients it is a strong indicator that their reviews may not be real. You can explore our case studies here.

8. Supply Chain Companies

Working with a reputable sourcing agent can be beneficial for businesses new to sourcing from China. They can leverage their local expertise and network to find reliable manufacturers and manage the entire process. 

Navigating the complexities of international sourcing can be overwhelming, especially for businesses with limited experience in China. We understand these challenges firsthand. At J&H Group, we've had the privilege of helping a range of clients, from Fortune 500 companies, established Small & Medium-sized Enterprises and e-commerce solopreneurs. 

Our experience spans various industries, giving us a broad understanding of different manufacturing needs and quality standards. We handle the entire manufacturing process, from identifying and vetting suppliers to quality assurance and logistics. 

This lets our clients focus on what they do best, growing their businesses!

Sourcing products from China can be rewarding when done right. By following the strategies outlined in this guide, conducting thorough due diligence, and prioritizing quality and communication, you can minimize risks and establish successful partnerships with reliable Chinese manufacturers. 

Don't let the challenges hold you back. J&H Group is here to guide you every step of the way. Our experienced team, based in Shanghai, offers sourcing solutions tailored to your specific needs. 

We'll handle the intricacies of finding reliable manufacturers, negotiating contracts, managing quality control, and ensuring smooth logistics so you don’t have too.

Click below for a free consultation.