How does Drop Shipping with Alibaba Work?
The guide below will explain and show you how to successfully use Alibaba for your drop shipping business.
Alibaba is a business to business platform. Therefore, to be able to drop ship using Alibaba,you will need to secure your supplier on their platform.After securing orders from your own store,you will request your Alibaba supplier to fulfill and ship to your buyer
How Drop Shipping on Alibaba Differs from Amazon & eBay?
You are Mostly Buying from Manufacturers
For your drop shipping business to earn huge profits, you need to minimize the layers between you and the manufacturer. Alibaba is therefore ideal as it offers you a direct link to original manufacturers who supply at wholesale prices.
There is a Required Minimum Order Quantity
This is the smallest order that the manufacturer can allow. Ideally, MOQ should not scare you away as it can be negotiated.
Some Suppliers don’t have Free on board (FOB)
When you deal directly with manufacturers, most goods are coming directly from factories and need transport to the ports and up to when they are on the water. This cost can be covered by the supplier hence the goods will be FOB. With this in mind, you should work with suppliers with FOB.
You Source Products from Suppliers on Alibaba & List them in Your Online Store
Alibaba is a platform that allows you access to many suppliers. Once you secure a supplier you can list items on your store and therefore direct your supplier to ship directly to your customers and fulfill orders.
What is the Process of Drop Shipping on Alibaba?
Drop Shipping on Alibaba will require you to follow some specific steps. This is because it has different profit and shipping models.
How to Find the Right Products?
First, you need to identify products that can fit the Alibaba business to business model. This is because mostly, your customers won’t be ordering a single item. In addition, most suppliers require your orders to have MOQ.
How to Create Your Alibaba Account?
Visit the Alibaba website to register your account.You will be required to enter all your details to make sure you are a legitimate business, Alibaba will require your business documentation as it doesn’t allow individual accounts.
How to Find a Legitimate Supplier?
This will be an easy step since there are a lot of suppliers for the same products on Alibaba. Search for gold certified suppliers as they are vetted by Alibaba.
How to Negotiate MOQ & FOB?
Next step is agreeing on terms with your supplier. You will need to negotiate a reasonable minimum order quantity and make sure the supplier give you FOB on your products. Notably, this will go a long way into reducing your costs when you start drop shipping the items.
How to Order for Samples?
Your Alibaba account has easy-to-follow steps to request for a sample. This not only helps you make your quotation but also gives you an opportunity to verify the quality of products. Moreover, you should make sure they match their descriptions.
How to Transition to Drop Shipping?
After you have set the terms and agreed with the supplier, you can now start drop shipping your items. This will involve;
Creating Your Drop shipping Store Away from Alibaba
You can create your own store using Shopify or register a seller account on Amazon.
Listing & Taking Orders.
After listing your products, you will start receiving orders. Since your suppliers will have to ship to different locations every time, they might ask for more fees.
However, this will not impact a lot on your profits as you are getting the items at the price other suppliers buy for.
Finally, to ensure you get good profits, you can list items as also available for sale in large quantities. This will help you secure customers who buy in bulk
In a Nutshell
Having gone through this guide you can comfortably tailor Alibaba to suit your drop shipping business.