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Why AliExpress Dropshipping and How Does it Work? (FAQs)
With dropshipping, store owners can sell and ship products to their customers without actually seeing the products. After you sell a product, you simply buy it from a supplier and have it shipped directly to the customer.
Entrepreneurs love it because there is no inventory to hold, and a lower upfront investment lets you concentrate, in most cases, on the most important thing – bringing in customers.
Dropshipping isn’t something new. Zappos started off with dropshipping back in 1999. Amazon and Sears use dropshipping too. In fact, up to 33% of the entire eCommerce industry has adopted dropshipping as their primary inventory management model. And, if big names don’t catch your attention, look at the regular guys making their way and sharing their stories on Reddit.
So what does this have to do with AliExpress? Dropshipping is fueled by Chinese suppliers, and the number of Chinese dropshipping companies is on the rise. The growth of Chinese exports during the last decade can be linked to their integration with western businesses, and now thousands of Chinese suppliers understand the opportunity they have with dropshipping. That’s why to most people, dropshipping reminds them of Chinese products and nothing else.
AliExpress dropshipping is the new trend. It’s a way to easily start your first businesses or boost your current store’s efficiency. No doubt it comes with drawbacks, but let me start from the beginning.
What is AliExpress?
Charming Jack Ma shouldn’t be a stranger to you. A guy who built a $179B Alibaba empire is a superstar now. Often compared to Jeff Bezos from Amazon, Jack started his business in 1999 after failing to find Chinese products online and built a platform to offer Chinese suppliers’ products to the western part of the world.
At his primary business, Alibaba, you can buy products for your store and stock them in your own warehouse. On AliExpress, you can buy products in single pieces for yourself or you can dropship.
Both options are platforms, meaning that individual sellers can register there and sell their products to the world. Neither Alibaba nor AliExpress holds inventory. They are marketplaces, comparable to eBay.
How does AliExpress dropshipping work?
AliExpress dropshipping works similarly to the traditional dropshipping method. You copy the product from AliExpress to your store, set your own prices/ markups, and after you sell a product, you purchase it from AliExpress and have it shipped directly to your customer.
AliExpress dropshipping comes with many advantages, but dropshipping is much more nuanced than just stocking the inventory. AliExpress dropshipping can be total chaos if you do not take control in the beginning.
How does it differ from the standard dropshipping?
One of the biggest wholesale directories, WholeSale2b, offers over 1,500,000 products. AliExpress sells more than 1,500,000 t-shirts alone. Not to mention other categories like Consumer Electronics and Jewelry.
In addition to numerous dropshipping advantages, AliExpress dropshipping is extremely flexible:
▸ You control your own margins. You are not bound to a suggested retail price (MSRP) and can decide your retail price on your own.
▸ You can start immediately, for free. AliExpress dropshipping is possible even without contacting the supplier.
▸ You don’t need an established business entity before starting your online store. Though you will need one when you grow.
▸ You have access to millions of products. Instantly.
▸ AliExpress products are trendy. Chinese suppliers do their research watching the trends. Presidential campaign heating up? Sell Trump and Clinton t-shirts.
This all looks pretty good, right? So what is so messy about it? Below I answer the most frequently asked questions I hear about AliExpress dropshipping. Being fond of AliExpress, I find some questions uncomfortable, but I did my best to provide an honest, accurate picture.
Can you dropship AliExpress products easily?
Definitely yes. It’s even easier with tools like Oberlo.
Dropshipping from AliExpress makes all parties equally happy. AliExpress as a platform gets its share of revenue, suppliers sell their product, and you make profits.
I’ve personally sold over $3M worth of AliExpress products and know guys who have sold even more. It works
Will my customers know if the products are dropshipped from AliExpress?
Only if they found the same products on AliExpress themselves.
There are rarely any promotions in the packages your customer receives. And you can prevent that by contacting the suppliers through AliExpress messaging system before your orders are shipped.
If you’re doing quite a bit of sales, you can even arrange custom packages or flyers for free.
Why should someone buy from me if you can buy the same product from AliExpress cheaper?
Because you’re better.
Call it better marketing execution which reached the potential customer first, call it a brand which makes people buy from you, call it trusting your store brand or even your location, call it the value you offer by providing extra services or content, or call it technology that allows your customers to shop more easily.
Don’t be obsessed with price competition or even worse, uniqueness. In eCommerce, you will never be the cheapest and you will most likely never be unique.
Especially with lower priced products (<$100), the price is not the determining factor.
Look at the same product on different websites:
All these stores are multi-million businesses. Are these companies price competitive? No. Are they out of business? No. Why? Because in some ways they are better.
That being said, the possibility to set your own prices and not worrying about being price competitive should further ease the start of your business. If you have calculated that it costs $15 to get one customer with Facebook marketing, add $22 to the original AliExpress price and try to make the sale. You can increase your price, as long as it makes sense for people to buy the product at that price.
You can reorganize your pricing strategy later, but for the eCommerce first timers, this a tremendous no-sales relief.
AliExpress shipping takes too long, my customers won’t wait.
Alibaba made over $14 billions in sales in one day. Customers of other businesses listed above don’t seem to be concerned with long delivery terms either. Your task is to set clear expectations, define your shipping policy, and display it in the relevant places on your store.
AliExpress packages aren’t delivered by sea anymore, and it doesn’t always take 60 business days. Actually, with the now popular ePacket delivery option, it takes only 7-14 days to reach the US.
There are rumors that ePacket is coming to other major markets like Australia, the United Kingdom, and Canada too.
In addition, some suppliers keep their most popular products in US warehouses, which offers even quicker delivery.
Pick only the best suppliers and do your research. If you pick a random supplier, chances are you picked the one with the 2 months delivery option.
Note: the differences between shipping options are huge. Some suppliers claim to ship out their orders the same day with ePacket delivery (delivery time: approximately two weeks), others ship out their orders within 10 days and offer standard China Post 45 days delivery (delivery time: approximately two months).
What about quality risk and copyright infringements?
You probably have heard stories about the ridiculously bad quality of Chinese products. Sadly, these stories are true. But there are two sides to every story.
You can just as easily run into a bad supplier in Europe or the US. In the end, it’s you who needs do the careful due diligence, and it’s you who should sort the bad suppliers from the good ones. The unfortunate stories are well documented. Read them and don’t repeat the mistakes.
AliExpress is a marketplace, and just like I can put any item on eBay, a Chinese supplier can put any item on AliExpress. Just like eBay has had thousand of scammers and quality issues, AliExpress has had theirs too. Being a public company and hoping for business in foreign markets, AliExpress is forced to do a great job changing. Supplier accounts on AliExpress are no longer free. You have to pay ~$1,500 to have your full store running, which makes it difficult for scammers. Moreover, AliExpress offers a generous buyers safety program and hires thousand of employees to check their listings. In fact, Alibaba’s group hires over 2,000 employees to check that their listings don’t contain copyright infringements. A lot of Chinese suppliers can’t afford to sell cheap products anymore.
Do AliExpress suppliers speak English?
Chinese suppliers’ English can be a bit clumsy.
But, you can contact the suppliers in advance to get a sense of their English before doing business with them.
Bigger suppliers are quite responsive. They have sales teams managing your orders and answering your questions in live chat or email.
AliExpress Dropshipping is far from perfect. It’s tough and complex. It requires time, careful research, and planning. But it’s advantages make it the easiest way to kick-off your online business and it’s totally awesome for testing new product ideas.
Recall what has been said in the previous chapter:
AliExpress dropshipping works similarly to the traditional dropshipping method. You copy the product from AliExpress to your store, set your own prices/markups, and after you sell a product, you purchase it from AliExpress and have it shipped directly to your customer.
It’s extremely flexible and makes it the easiest way to kick-off your online store is with AliExpress Dropshipping.
There are three steps to getting a product to your store: finding the product, evaluating the supplier, importing the product to your store.
Finding Products on AliExpress
1. Add Products to Your Wishlist
AliExpress is just like an Amazon supplier database. Just go to AliExpress.com and look for the products you decided to sell in day two.
Once you find a product that fits your search criterias, add it to your AliExpress account wish list.
Make sure your products can be delivered with the ePacket delivery option. ePacket delivery takes only 14 days to arrive to the US, while other delivery options usually takes over a month.
Handy Tip: Install our free Chrome Extension and sort ePacket products in the category page.
Tip: Don’t Always Go For the Lowest Price
Typically, the price on AliExpress.com goes down with the quality. So don’t get overly excited when you find the same product at a fraction of the price.
There are a lot of sellers offering similar products on AliExpress.com. Be sure to compare prices different suppliers set. If a number of sellers have similar prices for the same product, but if one supplier has a significantly different price, this usually indicates that they have compromised on the quality of the product.
Although a lower price does not necessarily mean lower quality and vice versa, we highly recommend you avoid those types of situations. Here is an example:
Keep in mind that Chinese sellers on AliExpress.com have very tight margins and understand them well, this is why a higher price normally means a better quality product.
Tip: Look for Suppliers That Have 95% and Higher Positive Feedback
Two most important things while evaluating AliExpress.com sellers are their Feedback Score and Positive Feedback Rate. The Feedback Score indicates the seller’s sales volume, while the Positive Feedback Rate represents the feedback rate that the supplier has received. Always aim for 95% or higher positive feedback rate and at least a 2,000 feedback score.
Obviously, this doesn’t automatically mean that a supplier with a 500 feedback score is not to be trusted, but it is a good general measure to go by.
You should also consider individual product feedback and the order count. It’s much safer to buy a product that has been ordered a few thousand times with a 90% positive feedback score, than a product that has only been sold twice but has a 100% positive feedback score. Look for any unhappy customers. Usually, the unhappy customers help identify possible products defects and issues.
If a particular product does not yet have any feedback, look up the other products in the same category of that supplier and check the feedback. Some sellers start selling other vertical products, and you don’t want your customers to become the testers of those new products.
Tip: Pay Attention to the Responsiveness of the Supplier
Let’s say you have an emergency situation — a customer files a dispute on your PayPal account and insists on a reshipment. You want your supplier to respond to you immediately, don’t you?
To protect yourself against such situations, always check how responsive the AliExpress.com supplier is before importing their product. Write them a message via AliExpress.com and see how quickly you receive an appropriate response. You can even create a fictional scenario where you say you haven’t received your order. Note how long it takes for your seller to reply and how they handle the situation.
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Importing Products to Your Store
1. Install free Oberlo Trial
Click here and install a free Oberlo trial to your Shopify store.
With Oberlo you can import products from AliExpress to your store. When you receive an order, Oberlo will ship those products to your customers automatically.
2. Set Up Oberlo
Before importing products to your store, you should set up the application. Go to the Oberlo settings page, set your Price Rules, and explore other settings.
3. Import Products
In case you haven’t done it yet, install our free Chrome Extension in order to use this importing method. Here’s the installation link: INSTALL
If you have installed our application, go to your AliExpress Wishlist and import all products that you’ve bookmarked before.
Alternatively, you can browse AliExpress, and after you find the product you want to import, click an orange arrow down button on the bottom right corner of the browser window.
The product is then added to your Oberlo Import List page where you can edit it and publish it to your shop.
4. Editing Products
AliExpress products often have very weird titles and descriptions. You’ll probably want to change them before publishing the products to your store.
Product customization is managed in the Oberlo Import List page. There you can set product category, update product title, description, tags, variants titles, adjust the prices, select which images you want to import, etc.
Just go to Oberlo Import List, edit your imported products and publish them to your store.
Chapter’s Action Item
Fill in Your Store with Products. Continue importing products from AliExpress until you have at least 50 products. Congrats, your store is now ready! In the next chapter, we’ll be learning how to launch your first Facebook Advertising campaigns and start making sales.