That's honestly why I do find it frustrating when people become shackled by their fear
of being scammed, because if they applied logic to their fears, they'd realize that
they don't really have much basis.
On AliExpress, if you come to an item listing you can see how long the supplier has been
on AliExpress, because you're ordering items individually not in bulk.
Working with suppliers that have been on the site for two plus years, is usually more than
enough to safeguard yourself.
If you're working with suppliers on Alibaba though, then the chances are you are doing
a much bigger order, and with large scale orders it makes sense to be more safe.
In that case then, a smart idea is to only work with suppliers that have been gold for
three plus years.
That means that they have purchased a gold subscription for that many years in a row.
A Gold subscription cost thousands of dollars each year to maintain, so a scam company is
not going to have been paying that for three plus years.
Tip two, be wary of suspicious payment methods.
If you're concerned with being actually scammed, then the biggest red flag is if they ask you
to pay in a suspicious way.
If you're purchasing items from AliExpress then in the beginning just stick to purchasing
items from AliExpress and using their checkout system.
In time though, as your drop shipping business grows, you will very likely move to a system
where you actually order items off the site, and this is entirely normal.
This is called [phonetic 00:03:38] drop shipping.
What you do, is you download all your orders from your Shopify store into a [phonetic 00:03:44]
file.
You then send that file to the drop shipper, and they will fulfill all of the orders for
you, so that you don't have to come in and buy each individual item for each customer.
When you do this you'll be paying for your items off of AliExpress and as long as they
are not asking you to do this with Western Union, then this is absolutely fine.
However, you don't need to worry about this type of order fulfillment until you have bought
up a relationship with your supplier.
In the meantime, stick to just ordering items from AliExpress, and my advice for you is
that if you are purchasing items in bulk from an Alibaba supplier, perhaps from Amazon,
that you do not send money to a bank that is located outside of mainland China.
This is where the scams happen, instead stick to using PayPal, or with bank wired transfers
that are going to a bank located in mainland China, do not send to Hong Kong, and if the
supplier asks you to send a Western Union, do not work with them.
Western Unions are the payment methods of scammers.
Why?
Well, because while Western Union does track the payout locations, these records are only
ever going to be obtained with a subpoena, and for small scale international fraud that's
not going to happen.
Do not ever pay with Western Union.
Tip three; protect yourself against faulty products.
When you're purchasing items from China, quality control issues are unfortunately going to
be an unavoidable part of the business, and this isn't them scamming you.
Even the best manufacturers have quality control issues.
It's just part of the manufacturing process.
So let's start out by looking at how you can protect yourself from this when drop shipping
with AliExpress.
With AliExpress you are protected with a refund policy, but it's not usually the lost money
that you spend on purchasing the item that is the real issue here.
Instead, the real problem here is your customer getting upset that you or your drop shipper
sent them a faulty item in the first place.
The best thing that you want to do is to try and avoid this happening at all.
So safeguard yourself by only working with suppliers that have a proven track record
of shipping out the items that you're selling in good condition.
Like take this Guitar Mug here, this supplier would be a good one to work with as not only
have they been on the site for two years, they also have excellent reviews from people
that have purchased this mug from them.
So don't just look for highly rated AliExpress stores, make sure that that store has a good
track record and a positive review history for shipping out the item that they were selling.
Now, if you're purchasing items from Alibaba, one way that you can protect and safeguard
yourself, is to purchase your items with PayPal.
If you do this then you are protected by PayPal's dispute program.
If you receive bad products then you know that if you can't work out some form of compensation
with your supplier, that you'll be able to claim a refund with PayPal.
However, a lot of Alibaba supplies will not accept PayPal as a form of payment, though
often they do use it for the product samples, but not for the actual order itself, and there
is nothing suspicious about this, it makes sense if they don't want to use PayPal because
it has very high fees unlike a bank wire which has a flat fee.
In that case there, a good way to still protect yourself is to only work with suppliers that
are part of the Alibaba's free trade assurance program, and here is how that works.
One, identify if your supplier is part of the trade assurance program.
If they are, they'll have the trade assurance icon on their listing, which when you click
on it, will tell you how much you can be protected for if you purchase products through them.
In this case here, you would be protected for orders up to $72,000 dollars, and considering
the fact that most people watching this will be ordering a shipment with $5,000 at least,
you are absolutely fine.
Two, negotiate with a supplier and create your contract.
Make sure that everyone agrees on all aspects of the order like shipping, price and the
terms, under which you will be covered from the trade assurance program.
Make sure that your contract specifies expectations of your products, not things like what size
they should be, what materials they should be made out of, and what colors they should
be.
Three, pay for the item through Alibaba.
You can pay with a telegraphic transfer or a checking if you live in the USA.
You've also got the option of using your credit card, it does have fees, although it provides
an additional layer of protection for you.
Now, I want to stress something; just because a supplier isn't a part of the trade assurance
program, doesn't mean that they are a scam.
However, as a beginner, it is nice to work with these suppliers to safeguard yourself.
Tip four, get your products inspected.
Now, this tip doesn't apply for people that are drop shipping with AliExpress.
This step is exclusively for people who are importing items in bulk, perhaps to private
label on sale on Amazon.
To safeguard yourself before your items get shipped out to your Amazon, if be a warehouse
from China, make sure that you get them and inspect it.
If the products do not pass the quality inspection, then you can negotiate with your supplier
to fix the problem before the items get sent out, or worst case scenario, if you cannot
come to a resolution you can file a dispute with PayPal or with Alibaba's trade assurance
program.
Alibaba offers a service that lets you organize and inspected through them, it costs US$200,
and it's well worth it.
You occasionally hear stories of people who apparently spend tens of thousands of dollars
on new order, only to have it arrive, and to find rocks inside their packages.
Well, those people were pretty stupid, weren't they?
If they had just worked with the supplier that was part of a trade Assurance Program
and they'd had their products inspected before shipped out, then they wouldn't have had this
problem, would they?
The vast majority of time, the people who get scammed are those that chose to work with
unproven suppliers because of the fact that they were offering them lower prices.
It was their greed that was their downfall.
Thanks for watching.
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