AliExpress and Alibaba are world-renowned e-commerce marketplaces that sound alike and both have their origins in China. So much so that they are often believed to be identical platforms.
A closer inspection, however, begins to reveal lots of differences between these two companies. It is thus important to examine them further before you decide which of them is the better platform for your needs.
So, in this discussion, we pit Alibaba vs AliExpress to find out what they are all about and what each of them can do for your business.
Ready? Let’s begin.
A Brief Introduction to AliExpress and Alibaba
Alibaba and AliExpress are both owned by the Alibaba Group. Alibaba was founded first in 1999 while AliExpress was begun as its spin-off much later in 2010.
Both companies largely sell goods from Chinese manufacturers and suppliers. However, they operate independently from each other because they were each started to fill different needs in the e-commerce sector.
Now that we have demystified that bit, let us learn more about each of them.
Alibaba
As China began to take the lead as a global manufacturing hub, businesses began to view it as a good source for a variety of products. Especially given how affordable the products were.
Alibaba was thus established as a platform to connect Chinese manufacturers with businesses in need of product suppliers. So, by definition, Alibaba is a B2B (business to business) e-commerce platform.
It is estimated that Alibaba connects over 150,000 suppliers with more than 10 million businesses across the world. It has contributed significantly to the growth of export trade in China and is proof of how impactful e-commerce platforms can be.
How Does It Work?
At this point, you may be wondering how the Alibaba platform works. Here is a brief guide on that.
- First, the seller/Chinese manufacturer creates an account on Alibaba
- Having an account allows suppliers to set up a webstore on the platform where they can display their products and manufacturing capabilities
- When you visit Alibaba as a buyer, the different suppliers’ products are displayed depending on what you search for
- If you like what you see, you can visit the seller’s online store and negotiate your purchase further
- While you can browse the platform without signing up, it is best to create a buyer account if you are going to make a purchase. It is safer and you will have a record of your purchases.
Given that Alibaba is a B2B e-commerce platform, you will notice that most suppliers offer products only in bulk quantities. The MOQ terms can vary between suppliers but often, the larger your order, the better the prices.
Nevertheless, because businesses have different needs, most sellers are open to negotiations.
The transactions are also rather flexible. While Alibaba provides and supports various communication and payment channels, you are not restricted to them.
Are There Any Fees Involved?
It is free to sign up on Alibaba despite the numerous support resources it offers suppliers with stores on the platform. Alibaba also does not impose a direct commission on payment just as it does not restrict users to a specific payment channel.
Sellers are, nonetheless, charged a fee if they upgrade their accounts and join the ‘Gold Supplier’ forum. Attaining a Gold Supplier badge means that a seller’s production capabilities have been verified. Such verification can help them attract more buyers.
Pros:
- It is free for both buyers and sellers
- Businesses get access to a very wide variety of products on Alibaba
- Having a plethora of suppliers and manufacturers on one platform makes it easy to compare them and find a deal that works for your business
- Most suppliers offer affordable wholesale prices
- Alibaba does not restrict how you, as a buyer, can interact with the suppliers; you can use whatever communication methods you please
Cons:
- While access to a long list of suppliers is advantageous, it can be overwhelming. Sorting through them to find exactly what you need can be tasking
- The Alibaba platform supports various payment options but does not actually process the payments; that is left to suppliers. This flexibility can be beneficial but it can make it easy for unscrupulous suppliers to scam unsuspecting buyers
- Alibaba does not readily offer tracking information on shipments. You would have to contact individual suppliers and request them to send you the details
- The Minimum Order Quantities/Volumes can be restrictive especially if your business is still in its early stages and you are not able to buy in bulk
AliExpress
After years of Alibaba’s success, it became evident that there was a gap in the market. Small-scale and individual buyers expressed interest in the products on Alibaba but could not meet the MOQs.
AliExpress was thus created to fill this very large market gap. It is a B2C (Business to Customer) e-commerce platform. Its main target market is retail shoppers that want to buy single or few units of items at a bargain.
Having been in the market for more than a decade, AliExpress has grown to become very popular. It competes with heavy hitters such as Amazon for a piece of the international e-commerce retail market.
How Does It Work?
AliExpress is quite easy to use. It works as follows:
For suppliers:
- Each supplier has to first register an account to get started
- They would also have to await their credentials and authorization for the account (this is important for payments)
- They can then list the products they have for sale and their product descriptions
For buyers:
- As a buyer, it is best to set up an account on the AliExpress platform
- Proceed to search for the products you require
- Filter the requests you receive to create a shorter more refined list
Note: At this stage, if you have any special requests such as dropshipping, you can always contact the specific suppliers
- Add your selected item(s)to your cart and proceed to pay
AliExpress has a buyer protection policy that seeks to safeguard your transactions on the platform. For example, it recommends paying via certain channels like Paypal where your transaction can be certified. The policy also provides:
- A money-back guarantee if you receive an order that does not match your expectations or what it was described as in the product description
- Mediation guidelines for buyer-seller conflicts
Are There Any Fees Involved?
AliExpress processes the payment transaction between buyers and suppliers. It charges a percentage-based commission for each sale. There are, however, no standard fees for buyers.
Pros:
- Buyers can buy single units of items at affordable prices
- The buyer protection policy safeguards buyers from scammers
- AliExpress suppliers can dispatch orders quicker because the products listed on the platform are usually available on order
- AliExpress offers other services such as dropshipping
Cons:
- The prices listed on AliExpress are non-negotiable
- The buyer protection policy is a great provision but it has not managed to fully curb scamming on AliExpress
Alibaba vs AliExpress: Their Major Differences
As we have established, the main difference between Alibaba and AliExpress is that the former is a B2B platform while the latter is a B2C. Nonetheless, there are other notable differences worth considering to determine which of them is best for your business.
Buyer Protection on Payments
Both Alibaba and AliExpress have a buyer protection policy. However, unlike AliExpress, Alibaba does not offer a money-back guarantee. This is likely because Alibaba does not process payments to suppliers and thus has no direct access to the funds.
However, it is important to mention that even on AliExpress, your transactions are only protected if you use the recommended payment methods.
Pricing
Alibaba offers unbeatable bargains that are often cheaper than AliExpress prices. It is also possible to negotiate for lower prices with suppliers based on the size of your purchase. Nevertheless, the bargains on Alibaba only apply if you are shopping in bulk.
In contrast, on AliExpress, the prices are reasonably low but you can still buy single units of products. On the downside, they are fixed and non-negotiable.
Orders and Quantities
On Alibaba, everything is sold in bulk quantities and sellers set their own minimum order quantities. Most of the items are manufactured on order. Therefore, your goods may not be dispatched immediately after you place an order.
Things work differently on AliExpress. All goods are ready-made and can be sent to you once the order is processed. There are also no MOQ restrictions.
Shipping
There are two main shipping differences between AliExpress and Alibaba; timelines and the methods used.
Shipping on Alibaba takes longer than AliExpress. This is because the goods have to be manufactured first before they are sent out to you. It can take anything from a month or more before your goods are en route.
On methods, AliExpress suppliers mostly ship smaller packages. They are, therefore, able to use ePacket shipping which is cheaper. Some suppliers even offer free shipping from time to time. Better still, tracking information is always available on AliExpress.
In comparison, given that Alibaba sells in bulk, its shipments are much bigger. They require different shipping solutions that usually cost more than ePacket. Unfortunately, tracking information is also not readily available; you have to request it from your supplier.
Product Specifications
Alibaba allows for direct contact between buyers and suppliers. During these interactions, you can inquire about the certifications of a product to determine whether they would be ideal for your market.
Further, given that the products listed on Alibaba are not ready-made, you can request customization as you place your order. This may cost a little extra but you will end up with products that are exactly what you need.
Unfortunately, on AliExpress, what you see is what you get. The products are ready-made and can not be customized. You may also not be able to reach every supplier to find out whether the product meets specific certifications.
Alibaba vs AliExpress: Which of Them Is Best for Dropshipping?
Between these two platforms, AliExpress is the option that fully supports dropshipping. It is also the better dropshipping platform because:
- As a dropshipper, you can order and ship single units of products to buyers from AliExpress
- Most suppliers understand the concept of dropshipping and will fulfill orders on your behalf accordingly if you inform them that it is a dropship order
- The prices are fair enough for you to still make a healthy profit when dropshipping the products
- Tracking details on shipments are easily available and you can monitor deliveries and give your customers an ETA
- AliExpress shipping options are cheaper and would not unbearably inflate the total price of an item
That being said, it is not impossible to dropship from Alibaba. Especially considering the platform offers access to private labeling services.
You would, nevertheless, have to:
- Find a supplier that is willing to supply the quantities you want to dropship
- Engage them and find out if they would be willing to dropship
- Negotiate a fair price that would earn you a decent mark-up
- Request tracking information to be able to track the shipment
Overall, Alibaba may not be the most ideal dropshipping platform. However, it may be worth considering if you have scaled up your business and have started handling bulk orders.
In Summary
Alibaba and AliExpress both offer great benefits to online shoppers and dropshippers. The trick is to know which platform is best for specific functions.
Alibaba is great for:
- Buying goods in bulk at a bargain
- Sourcing customized goods
- Large-scale dropshipping
AliExpress, on the other hand, is ideal for:
- Buying smaller units of products at low prices
- Dropshipping
- Shopping instances when you need an item delivered in a shorter time
However, if you have a hard time navigating both of these platforms, NicheDropshipping can lighten that load for you. We are a one-stop dropshipping company that offers access to a wide variety of products and worldwide fulfillment. Further:
- Our product sourcing services are free
- We offer bulk buying and negotiate fair prices on your behalf
- We offer 18 affordable shipping options and provide tracking information
- Our service is prompt and we respond to product inquiries with price quotations within 2 business days
- You would have access to our private labeling, white labeling, and warehousing services
Simply reach out to us and we will introduce you to the world of profitable convenient dropshipping.
