You might call Alibaba the Amazon of China. The reason for this is because both of the ecommerce giants have been battling it out for market share all over the world, especially as Alibaba Group has successfully moved into Amazon's territory with consumer sales through AliExpress. But that's not the comparison we're talking about in this article. It's all about Alibaba vs AliExpress, both of which are managed under the same company and are becoming mainstays in the supplying and manufacturing in our world.
Alibaba has consistently improved revenue over the years, reaching into the $50 billion mark in 2019. But what is Alibaba for those who don't know? It often brings up comparisons to Amazon, but are they really that similar?
Yes and no.
Amazon is primarily focused on selling directly to consumers, with a little bit of business to business commerce occurring as well. In addition, Amazon serves as a marketplace for smaller merchants to sell items directly to consumers, similar to that of eBay or even the Walmart website.
Alibaba takes a different approach, by letting manufacturers and suppliers create profiles and sell their items to other businesses (you can pay an extra fee to be listed as a gold supplier). Therefore, it's not a B2C marketplace, but a B2B hub. And that's what makes Alibaba so important to ecommerce stores all over the world. It's a well-organized wholesale and product customization market with insanely good prices. Not only that, but Alibaba has a subset of its business called AliExpress, which also serves a purpose for online store owners.
So, let's take a look into what the differences are between Alibaba and AliExpress. Is one better for your small or large online store? Are you able to get great prices from each and have the products customized and sent directly to your customers?
Keep reading to find out.
Alibaba vs AliExpress: Comparison at a Glance
Alibaba states that the actual Alibaba.com website is a place for merchants to buy wholesale products from some of the best Chinese suppliers. These purchases can be shipped almost anywhere in the world. Not to mention, Alibaba boasts extremely low per-unit pricing because of its wholesale strategy located in the developing country of China.
The members who sign up on Alibaba are almost strictly resellers, trading companies, and manufacturers. So, an online store could purchase wholesale products that are already manufactured, or they could customize items–such as placing logos on hats. In addition, merchants might consider creating a completely new invention and speaking to an Alibaba manufacturer to get a prototype and mass production started.
AliExpress.com, on the other hand, is a smaller subset of Alibaba, but it's still a large ecommerce marketplace for Chinese and Asian manufacturers and suppliers to sell goods. Many of the same suppliers are on both AliExpress and Alibaba.
That being said, there's one large difference between the two: AliExpress has low prices at smaller quantities (you could buy one or two items for close to wholesale,) while Alibaba sellers typically require a minimum purchase order–similar to a standard wholesaler, except Alibaba's prices are typically lower and you can find millions of unique products through Alibaba.
In short, Alibaba is for larger quantities at a much cheaper per-unit cost, while AliExpress sells smaller batches for higher prices per-unit (but they're still cheap).
Both are excellent choices if you're running an online store, considering the goal is to find quality products while still maximizing your margins.
Alibaba vs AliExpress: How They Differ for Regular Consumers
Most of the people buying on Amazon are regular consumers–those who want to purchase one dog toy or a new television. Sure, many large or small businesses go on Amazon and purchase larger orders in the hopes of getting some good deals, but Amazon has never focused much on providing true B2B wholesaling or dropshipping. Therefore, Amazon is far more useful for the average consumer than a place like Alibaba.
In fact, Alibaba is strictly a B2B marketplace. Again, an ordinary person could most definitely go on Alibaba and purchase 1,000 customized shirts for themselves, but that's not exactly what the website is typically used for.
Therefore, Alibaba has little value to the average consumer since it often takes a bit longer for production time, the deliveries aren't particularly fast, and you're not able to visit Alibaba and purchase one or two items for your own home.
On the other hand, AliExpress doesn't have as many minimum purchase order requirements. In fact, the majority of the items sold are listed at factory prices without the minimum purchase obligation.
Therefore, AliExpress serves two purposes. It's similar to Amazon where loads of users go on the website to find individual items for their homes. But at the same time, it's a godsend for merchants around the world who are nervous about buying up loads of inventory through Alibaba.
Alibaba vs AliExpress: How They Differ for Ecommerce Merchants
As we mentioned before, Alibaba is for merchants that want to purchase large wholesale orders from manufacturers and suppliers, mainly in China. On the other hand, merchants also have the luxury of turning to AliExpress, which typically removes the minimum purchase order so dropshippers have the opportunity to buy small quantities of each item.
But there's more to it than that. Let's cover what these differences mean for ecommerce stores, considering some companies will want to start small, while others will be looking for the cheapest per unit pricing with wholesaling.
What's the pricing like?
- Alibaba has some of the lowest pricing you can find in the entire world. Not only is it cheaper to source from countries like China, but the suppliers on Alibaba sell in bulk, allowing them to keep costs even lower. In short, the pricing on Alibaba is extremely low, meaning you'll be able to turn a bigger profit per sale. It's also worth mentioning that you can negotiate with suppliers to get an even better deal.
- AliExpress has higher per-unit pricing than Alibaba, but that's because it doesn't require a minimum purchase order from most suppliers. Not only that, but there's no haggling through AliExpress.
Which is easiest to use?
- Alibaba has an interface similar to that of a large ecommerce marketplace like Amazon. It's very easy to use, but it may take some getting used to when looking for credible suppliers and learning how to get in contact with them. In addition, you may find it a little difficult to communicate since much of the time you either won't speak the same language or you're working with someone with choppy English.
- The AliExpress interface is just as simple to use as Alibaba. You search for items and even have the chance to integrate with ecommerce platforms like Shopify and BigCommerce. It's by far the best for dropshipping, and you often don't have to communicate as much with the suppliers as you would on Alibaba.
How long does production take?
- Alibaba has a production time of about 15-45 days. You can often add on even more time for shipping. The reason for the long wait is because you're most likely making a large order that takes time. Some of the orders are custom made, and you also have to factor in how far your country is away from China. The good news is that you should only have to worry about upsetting customers when you run out of stock.
- AliExpress is usually a bit faster than Alibaba, from 7 to 45 days. Again, shipping from China is an issue, especially if you're dropshipping directly to customers. Having said that, custom products are far less likely on AliExpress, so the supplier or manufacturer probably has the merchandise in stock to send out.
Can you get private label products?
- Alibaba is your best option if you'd like full control over things like branding, packaging, invoicing, and labels on the items. Most of the time you can find manufacturers willing to create anything for you. Therefore, you can maintain your own branding and even have them design completely new inventions for you.
- AliExpress does not have private labeling, so you're selling items with other company's labels on them–or no label at all. This isn't always a problem, but if you want your own logos on hats and shirts, you won't find this on AliExpress.
What's the buyer protection like?
- Alibaba has limited buyer protection. In our experience, you're able to get samples and talk directly to the suppliers. They all have their own policies in terms of returns, but most of the time it has to be a blatant error on the side of the supplier.
- AliExpress is closer in relation to Amazon, or other marketplaces, where you can contact customer support and request returns and protect your purchases just in case something happens to them. The reason for this is because the orders are smaller so they're more manageable to protect.
Can regular consumers use these websites?
- Alibaba doesn't allow regular consumers. That said, a person technically could go on there and order something. But it would only make sense if you can hit the minimum order requirement.
- AliExpress is open to all consumers, so your customers could technically skip your website and try to buy the same item on AliExpress.
Can businesses buy from these websites?
- Alibaba is for business-to-business transactions.
- AliExpress lets both businesses and consumers make purchases through the marketplace.
What are the shipping costs?
- Alibaba shipping costs depend entirely on the manufacturer or supplier you partner up with. It depends on the shipping method, size of the order, and what the supplier wants to charge. In general, you should expect some higher shipping costs than average, but nothing too out of control.
- AliExpress often has free shipping, but sometimes there's a fee. The packages are smaller and can usually be sent through an ePacket, which is more cost-effective and faster than other international shipping options.
What's the minimum order quantity (MOQ)?
- Alibaba suppliers usually have at least some sort of minimum requirement. For instance, it's not uncommon to see a requirement of at least 100 or 500 units. Therefore, it's a wholesale operation that needs you to have a much higher order than from other ecommerce websites.
- AliExpress doesn't have any minimum order quantities (MOQ). If you notice one from a supplier you should skip the product and look for another supplier. The reason for this is because many companies are dropshipping directly to customers, so it wouldn't make sense if you had to buy 10 items when you only need one of them.
Alibaba vs AliExpress: The Pricing in Detail
We know that Alibaba has minimum order quantities, so that means all your upfront costs for a purchase are much higher than that of AliExpress. However, given you sell all of your products, the profit ends up being much higher with Alibaba products. This is because the per-unit cost from Alibaba is far cheaper, just like any wholesale purchase.
Alibaba doesn't require any type of payment method to get started on the website. For instance, there's no need to sign up for a membership to gain access to the large collection of suppliers and products.
Businesses can browse through the site and look through products without any restrictions. Then, you can chat with suppliers and figure out what shipping costs are and how many units you must purchase to hit the minimum order quantity (MOQ). Overall, Alibaba is completely free until you place an order with one of the suppliers. After that is when you have to worry about the upfront capital to pay for a batch of products.
Pricing for Products on Alibaba
As we've already learned, Alibaba serves a business to business market where the per-unit prices are kept extremely low due to the fact that they sell in bulk and most of the suppliers are in China. This works very similarly to any wholesaler, except you gain access to a large marketplace of suppliers and are able to check out ratings and reviews from the suppliers.
Sometimes you'll see lower minimum order quantities, but it's more common to find products that sell in 100 to 1,000 item batches.
So, if you look at some products on Alibaba, you can see how a quick search for men's clothing shows a shirt, shorts, and a jacket.
The shirt is actually available for custom printing, and each unit starts at $2.50. However, you must make an order of at least 100 shirts. The shorts are fairly inexpensive as well, but you need to buy at least 2,400 pieces. Some items are more expensive than others, but it's not that difficult to browse around to find the best deals possible. In addition, you can typically order samples before you commit to full orders.
Pricing for Products on AliExpress
AliExpress has higher pricing than Alibaba for one main reason: AliExpress is not a wholesaler. Instead, consumers and businesses can go on the website and purchase individual products for fairly low prices. However, you don't get the advantages of bulk pricing like you would on Alibaba.
Having said that, the prices are still low enough to make a profit as an online seller. That's why so many apps and plugins are available for dropshipping with AliExpress.
Again, it may take some browsing and research to figure out the best suppliers with the lowest pricing and highest quality products. However, simply looking around on the AliExpress marketplace clearly shows how the per-unit prices for clothing are higher than that of Alibaba.
One of the fancier winter jackets shown above is sold for $64. Granted, you could probably sell this on your website for a steep markup, it's nothing like a wholesale listing. Some of the other ones are cheaper, such as the $5 jeans or the $10 hoodies. Regardless, remember to always check in with the suppliers and see whether or not they have high-quality products and fast lead times and delivery times.
Startup Costs for Your Business
Keep in mind that running an online store doesn't only mean paying for items on Alibaba or AliExpress. You must build a website, potentially get a theme, and get whatever plugins required to make your site as functional as possible.
As an example, a WordPress website is free, but you may have to pay for a theme, you definitely have to pay for hosting, and plenty of plugins are needed for making a fully operational ecommerce store.
For Shopify, a monthly payment of at least $29 is required (credit card or debit card only). There are also lots of apps that you might find helpful, along with a good-looking theme.
In addition, a dropshipping site usually requires an app that integrates into your ecommerce platform. Some are available for AliExpress, but there's also one called Spocket that has some higher costs per month.
Learn about the costs of an actual ecommerce store here.
Alibaba vs AliExpress: Fulfillment Options
This is where the comparison between Alibaba and AliExpress gets really interesting. It's also where AliExpress has a distinct advantage for most merchants.
When you order products from Alibaba and AliExpress where do they go? Does the supplier package up the products for you and send them out to your customers? Are you left to package and send them yourself?
For Alibaba, it's just like buying from a wholesaler. Several boxes of your items will be shipped to your office or home door, leaving you to figure out how to get those products to the customer. This makes for high overhead with tasks like packaging, branding, shipping, and more.
However, you do have the option to partner with a third-party fulfillment company in your country. This way you don't have to worry as much about the entire shipping and handling process–yet you still take advantage of the large margins you receive when selling items from Alibaba.
What About AliExpress Fulfillment?
AliExpress is much different when it comes to fulfillment. First of all, any consumer can go onto AliExpress, order an item, and get it delivered to their house. You'll see the standard AliExpress branding like you would from a place like Amazon.
However, let's say you'd like to run a dropshipping website where your customers purchase goods from your website. If this is the case, many apps allow you to automate the process completely. You're able to pull product details from AliExpress and share them on your website.
When a customer orders something from you, the details are sent to the AliExpress supplier. That supplier then packages the item and sends it out to the customer–not your company address. This is a huge advantage, since AliExpress takes care of pretty much all fulfillment requirements. The only downside is that you lose quality control and you typically don't get to put your own branding on or inside the box.
Having said that, there's a chance you could make a deal with the Chinese supplier to put an invoice from your company in all of the boxes. It all depends on what your supplier is willing to do.
Although it's not perfect, AliExpress removes the need for you to spend time and money on warehousing, packaging, and shipping.
Alibaba vs AliExpress: Integrations
💡 Alibaba and AliExpress don't have their own integrations, but one allows for third-party integrations that make selling online much easier.
That one website is AliExpress. Although you may be able to locate a few plugins or apps for making Alibaba a little easier to manage, the best option is typically to make purchases directly through the Alibaba website and make your own product descriptions and take your own pictures.
On the other hand, AliExpress is your dropshipping go-to. It's meant to integrate with a wide range of ecommerce platforms, primarily through third-party apps and plugins.
This process works by installing an app on a platform like Shopify. This app lets you choose products and put the products you like on your store. You can then go in and edit anything you don't like (especially considering manufacturer content is pretty bad).
After that, a customer is able to place an order on your site. You typically have the ability to automatically send orders to the AliExpress supplier or manually approve them. After that, the fulfillment process is completed by directly sending the product to your customer.
Here's an ultimate guide on how get started with Aliexpress dropshipping. Many of our favorite integrations are included in the article, such as Oberlo, Spocket and WooDropship.
Alibaba vs AliExpress: Dropshipping
We covered most of this, but just to reiterate: AliExpress is for dropshipping and Alibaba is not. You can link AliExpress to your Shopify, BigCommerce, or WooCommerce store and automatically tell the supplier to ship whenever a purchase is made. Alibaba is mainly for wholesale purchases, so there's no fulfillment.
In addition, AliExpress has several apps to choose from when integrating with an ecommerce platform.
Alibaba vs AliExpress: Customization of Products
Here's a big part of the comparison that some suppliers don't quite understand when looking at both sites. Alibaba allows for lots of product customization, and AliExpress does not.
You can go on Alibaba and search for a wide range of suppliers who will custom print on items like hats and shirts. You can also go for private labeling, which means that your brand logo is placed on just about all of the products being purchased. What's also impressive is that many of the suppliers allow for an unlimited number of customizations, from simple logo placement on an item to a completely new prototype from an invention of yours.
AliExpress, on the other hand, works more like Amazon (for both consumers and companies,) seeing as how most of the items are already completed and ready to be sold. Therefore, you'll find a limited number of suppliers that make custom prints or allow you to put your logo on something. The same goes for private labeling, seeing as how this type of customization is far out of place for most of the suppliers.
In short, if you want to get really creative with your products, go with Alibaba. If you're more interested in inexpensive individual items that are ready to go and dropshipped to your customers, we recommend going with AliExpress.
Alibaba vs AliExpress: Buyer Protection and Manufacturer Vetting
A big part of purchasing online is knowing that your orders are protected. Sometimes it's up to you to research your suppliers, but it's also nice to know that the marketplace you buy from has some sort of protection for companies and consumers.
Let's start with Alibaba. Buyer protection is considered limited in the Alibaba marketplace. However, there are some ways to ensure that your products end up at your warehouse and don't get caught up in customs or anything like that.
Here's how to protect yourself on Alibaba
- Always get samples and test your products before buying them in bulk. Samples are great for seeing exactly what your customers will receive. Not to mention, it's better to see the final product before spending money on thousands of them. Do this by simply asking the supplier. Also, make sure that any custom designs are completely finished before ordering that sample. Otherwise, it's kind of a waste of time.
- We also recommend that you test sell your products before buying hundreds or thousands of them in bulk. You can easily dropship items to your customers to test the waters and see which of them are selling the most. After that is when you commit to a larger bulk order.
- Never pay for an order outside of Alibaba. The website has a secure payment system that gives you some purchase protection and removes most scams. Some suppliers will ask you to make payments through PayPal or Western Union. Sometimes this might just be to avoid taxes, but you're better off skipping thee suppliers at all times. It could very well be a scam, since Alibaba can't protect you outside of its own system.
- Only consider suppliers that have high ratings and reviews. Not only that, look for suppliers that have been assessed by third-party companies. Inspections typically include reports, photos of the facilities, and more. What's great is that Alibaba has a list of assessed suppliers. It's actually pretty easy to locate these on the website. Ratings are great, but assessments show that rules and laws aren't being broken in the process.
- Alibaba has something called trade assurance which offers options for getting refunds if your orders from suppliers take too long or don't match what was outlined in the order agreements. This isn't a guarantee that you can get a return, but Alibaba will help mediate the problem and provide the potential for a return. Suppliers must indicate that they provide this assurance, so this is yet another way to locate the most reputable Alibaba suppliers out there.
- Skip all branded items. Alibaba has thousands of suppliers trying to sell products online. Although Alibaba does a decent job at getting rid of fraudulent or counterfeit suppliers, some of them slip through the cracks. The last thing you want is to sell unlicensed products on your own website. Not only are those suppliers not reputable, but you could get in financial and legal trouble yourself. Therefore, stick to products that don't have logos. Better yet, print your own logos on the items for improved branding.
How To Protect Yourself on AliExpress
However, it is worth mentioning that AliExpress has buyer protection for consumers and merchants who dropship. It's all similar to Amazon, where suppliers are required to entertain refunds and returns.
For instance, AliExpress has a money-back guarantee that requires refunds and returns if the order isn't as described or if it isn't delivered in the right amount of time.
You can also make basic returns, even if the item isn't damaged or anything like that. The process is a little strange, since you are working as the middleman between your customer and AliExpress. Essentially, you would accept the return from your customer and then go through the steps on AliExpress to make that return yourself. It's rather fast and easy to understand, and most of the returns are completely free.
As for problem orders, AliExpress has a method where you contact the seller, apply for a refund, then get your money back in 15 orders if everything goes well. After that, you can make the refund to your own customer if you're running a dropshipping business.
Overall, AliExpress beats out Alibaba in the realm of buyer protection. Alibaba isn't necessarily bad in this area, but most of the orders are wholesale, bulk purchases. Therefore, it would be rather damaging to suppliers if it allowed more liberal return rules. It's primarily up to the buyers to find the best suppliers, pay through secure systems, and test and sample all products before committing to larger batches.
Alibaba vs AliExpress: Customer Service
A rather important part about online marketplaces is whether or not you can get the right customer service for your needs. Nothing's more confusing than trying to figure out a website that you know nothing about. Nothing's more frustrating than trying to get ahold of a customer service rep in a time of emergency.
Therefore, we want to spend some time uncovering the details from each company to see how they respond to queries from buyers. The good news is that the support should be somewhat consistent across the board since AliExpress is owned by Alibaba.
Unfortunately for many buyers, the fact that both companies are located in China means that you may not be working with people who speak the same language as you. Most of the time suppliers have someone who knows several languages, but even then, messages may get lost in translation.
Working With Sellers
Also, keep in mind that your experience with either Alibaba or AliExpress may entirely depend on the manufacturers and suppliers you work with. Tie that in with the decisions you make and it could go really well or really poorly. For instance, going with a low-rated seller just because they have some products you like is asking for a tough experience on either website.
The same could be said about the individual sellers you speak with. Some will be great and others will be terrible. The best way to minimize the chances of the bad ones involves all of the tips we covered a little earlier.
Customer Service from Alibaba
When your company purchases something from Alibaba you're not actually interacting directly with the staff at Alibaba. Instead, you're working with with the supplier(s) you decide on. Having said that, Alibaba does provide some customer support resources online such as forums, help centers, and options for contacting the company for help.
The primary way to get in contact with Alibaba support is through the live chatbox. You can also communicate with the support team via email. However, phone support is not offered at all. The Alibaba chat support seems pretty responsive, but there may be a chance that you have to wait around for an email reply.
Overall, the online resources are decent, and you at least have someone to contact if something goes wrong. But, the majority of your experience will depend on the amount of research you put into your own suppliers.
Customer Service from AliExpress
AliExpress can technically be called a smaller operation than Alibaba, but it's still a huge company. And as we mentioned before, being owned by Alibaba means that AliExpress has similar procedures when it comes to customer support. For instance, AliExpress also provides a live chat option for you to quickly get in contact with one of the support reps.
No phone support is given, but there is a section for reporting certain suppliers and managing disputes. Alibaba also has something like this, but in our experience, the process is a little more fluid with AliExpress. So, if you'd like to request a refund or talk about supplier problems, a resource is provided online for you to do so.
Alibaba vs AliExpress: Which One is Right for Your Needs?
The great part about this comparison is that it's usually pretty clear as to which marketplace your company should consider. You simply need to think about what products you want, how you would like to sell them, and how much control you want in terms of margins, quality, and shipping.
Go with Alibaba if…
- You would like to increase your margins by decreasing your per-unit costs.
- You like the idea of buying in bulk (large quantities).
- You have no problem with fulfilling the products yourself or getting a third-party fulfillment center to do the work for you.
- You'd like to have the opportunity to negotiate with the suppliers and speak with them directly.
- You have no problem with minimum order requirements.
- You're running an ecommerce business and planning on selling the products online (aka not a consumer).
- You want full control over branding and setting up a private label.
- You're not as concerned with faster shipping times.
Go with AliExpress if…
- You plan on running a dropshipping business where you create a website and sell products but don't complete any of the fulfillment tasks.
- You don't mind cutting into your profits in exchange for the luxury of having all fulfillment steps done for you.
- You have no problem not being able to negotiate better deals on the products.
- You're excited about being able to sell individual products to customers without having a minimum order requirement from the supplier.
- You like the idea of free shipping on almost all orders.
- You want some guaranteed buyer protection to ensure that none of your customers get mad and you don't get stuck with a bunch of returns.
- You have no plans for selling private labeled items.
- You're interested in slightly faster shipping than Alibaba.
That's all we have for our comparison between Alibaba vs AliExpress! Let us know in the comments if you have any experience with either of these marketplaces and what you sell on your websites.
Featured image credits: Shutterstock