Embarking on the journey of buying from Alibaba and reselling on Amazon opens a gateway to a world of opportunities and challenges. In this blog, we explore the following 5 key points.
Is it profitable to buy from Alibaba and sell on Amazon?
Alibaba is still the preferred and mainstream sourcing option for most importers. This is because Alibaba offers the most extensive categories and suppliers. Moreover, compared to Global Sources and Made-in-China, Alibaba provides a better overall user experience, with a user-friendly interface and higher update frequency.
The profit margins vary among different product types. High-value products like small electronic items usually have high-profit margins.
While for ordinary low-value products such as toilet paper, A4 paper, disposable cups, etc., the profit is limited. If you’re a new Amazon seller with a small budget, I don’t recommend purchasing such kinds of products from Alibaba, even though the wholesale price is really low. Because these normal daily-use items are typically monopolized by large retailers. It’s hard for you to compete with them.
Above, I just share which types of products might not make you much money and which ones can bring in good profits. However, in reality, no one can guarantee that a product will be profitable. Whether running a business can make money depends on various factors, such as product market research, your Amazon store operations, marketing budgets, strategies, and channels.
Alibaba to Amazon FBA step-by-step
The process from Alibaba to Amazon is straightforward. Once you have product ideas, source suppliers on Alibaba, and request quotes & samples. Reach out to multiple suppliers for comparison to understand the reasonable price range and assess whether suppliers can work well with you to make the products. Consider having 1-2 backup suppliers in case the initial supplier doesn’t meet your expectations.
Note that once you confirm the sample, you can start product photography and video shooting. Waiting until the completion of mass production is a delay. And the first version often can’t meet your expectations, and revisions take time. In addition, make sure to conduct quality control, especially if it’s your first order from this supplier. This helps prevent poor product quality that could lead to negative reviews from consumers.
Besides, you need to manage your time to create a selling account, list products, and create shipment plans using the ‘Send to Amazon’ workflow. Provide product labels and Amazon automatically assigned warehouse addresses to your supplier. Usually, suppliers have specialized freight forwarders to handle Amazon FBA shipments, particularly to regions in Europe and the Americas.
However, throughout the entire process, especially for newcomers, it’s easy to encounter issues. Here, I’ll primarily discuss the four most common mistakes.
4 newbie mistakes when buying and shipping from Alibaba to Amazon.
Focus too much on product costs while neglecting shipping costs.
In practice, shipping costs can make up 20% or more of the product’s value, sometimes even doubling the product prices. This is a common occurrence.
Regarding shipping costs, it’s actually quite reasonable for the US and Western Europe. The routes from China to these regions are numerous, and the logistics are very convenient. For instance, if a US Amazon seller has 100kg of general goods to transport from China via sea shipping to the destination port plus UPS to the door, the shipping fees are around $150.
While for Amazon sellers in Brazil, it’s quite expensive because of the too-long distance from China. The shipping cost for 1 CBM of general goods, around 300kg, won’t be less than $330 to the port.
It’s worth noting that for sensitive or electronic items, the shipping costs can be significantly higher than for general goods. The above-mentioned shipping costs are for your reference only; for real-time prices, please consult with us.
Additionally, if you want to estimate the budget needed when importing from China, don’t just inquire about the product price from the supplier; ask for a DDP price. This includes all the costs for this import, primarily covering product prices, shipping costs from the supplier’s warehouse to your door, and other fees incurred such as customs clearance fees, import duties and taxes.
Insist on directly approaching factories, not middlemen.
Many e-commerce mentors teach that going directly to factories for the lowest prices. If you’re buying a small quantity of products, there’s no need to spend a lot of time and effort verifying if the supplier is a genuine factory.
On one hand, it’s really hard to figure out real factories on Alibaba where most suppliers are trading companies. On the other hand, even if you manage to find a factory after a lot of effort, they may refuse or not take your small order seriously. In this case, as long as the supplier can work well with you to make the product and the price is within your expected range, you can proceed with him.
Dive into product development or customization from the start.
It’s now emphasized in pursuing product differentiation. Many beginners also start by customizing and developing new products. But this often ends up with failure due to the following 2 points.
Typically, startups and small businesses don’t know much about the product and haven’t done thorough market research. Just make upgrades or significant changes to the products based on their own ideas. In the end, it’s very likely that these products won’t attract or resonate with consumers, leading to poor sales.
For significant product changes and the development of entirely new products, high mold opening costs are involved, usually tens of thousands of dollars. This is a cost that never crossed the minds of all startups.
So, my advice is: don’t make it too complicated at the beginning, directly purchase ready-made products. Just like my successful clients. And their customization is simply on packaging, which is a cost-effective way to begin with minimal investment.
Test the market with a large number of SKUs but overlook heavy storage pressure.
Among various styles or variations of products, the probability of having hot-selling or best-selling items is higher than products with just one or two SKUs. Many new sellers might impulsively purchase a large number of products with many SKUs to test which ones have better sales performance, but this requires a substantial amount of funds for sourcing and storing products.
Taking dresses for example, if you choose five sizes from XS to XL, each size in 5 different colors and 3 lengths, you would have 40 SKUs. This can create significant pressure on your initial inventory investment.
Some smart sellers choose to find niche products with as few SKUs as possible, such as plus-size dresses, small-size high heels, etc. And some opt for very niche products with 1-2 SKUs.
For example, a few months ago, one of our clients wanted to get into the laundry detergent business because they saw another company earthbreeze only sells laundry detergent sheets with 2 SKUs and makes millions in sales every month. Simple items with few SKUs make supply chain management straightforward: not investing heavily in stocking up, and easier to maintain good product quality.
JingSourcing help you source profitable items from China to Amazon.
We are JingSourcing, a leading sourcing company in China. More than 1000 Amazon sellers have trusted us to wholesale and customize varied products from China. Many of them are startups and small businesses. We see and help them grow their business.
Realize multiple private label & packaging ideas under small batches.
But we can quickly help you find a suitable factory, whether you want simple product changes like colors, logo printing, and packaging or more complex customization like brand-new product development. Because we have been working with different types of factories—both large and small—that specialize in various categories. We act as your purchase office in China, committed to offering good prices and efficient sourcing.
For example, we had a client with a custom lunch bag project, similar to below image. Before approaching us, he had already found suppliers on Alibaba but was rejected due to the small order quantity.
Actually, once our agent sees this project, we know it’s easy to customize such bags. From our cooperative bag factories, we selected one that had made similar lunch bags before. They can produce my client’s ideas by making just slight modifications to their original products. So, it doesn’t matter if the MOQ is small.
Ask JingSourcing to best realize your custom ideas
Effectively inspect products to help you control quality and avoid bad reviews.
When selling products on Amazon, quality is very important, as poor quality will lead to negative reviews and further impact the store ranking. Alibaba’s quality inspection service is provided by 3rd-party inspection companies. They have fixed inspection procedures and normally adopt AQL sampling inspections. But in most cases, the amount they check is small, and not really in strict accordance with AQL standards. And they’ll only tell you whether it is a fail or a pass.
In comparison, our QC services are flexible and efficient. We inspect products after getting your checking focus. And in the process, we communicate with you every defective item right away and confirm whether it is acceptable. If many defects are found, you want to increase the inspected quantity or maybe do a full inspection, we can also help you. Regarding defective products, we represent you and negotiate with your supplier about solutions.
For example, recently a client purchased 10,000+ knives from us. He asked for a full inspection and repackaged them into different sets as required. All knives were sent to our warehouse. We counted the quantity and checked each knife for scratches, notches, and other issues. Defective knives were exchanged with the factory. Therefore, the client’s knives have a very high positive rating on Amazon.
Flexible shipping solutions to Amazon warehouse
Shipping is always a great concern for Amazon sellers. We offer you the best shipping rates based on our reliable freight forwarder networks and large volume of shipments. Whether your warehouse is located in Amazon’s North America, South America, Europe, or Asia sites, we can work out cost-effective shipping solutions.
In addition to general cargo, we can also ship sensitive and hazardous goods. For example, previously we helped a client to customize and successfully transport a batch of electric scooters. As the class 9 DG cargo, the shipment must be transported by sea. We have specialist and experienced DG freight forwarders to handle customs declaration procedures, including the preparation of all necessary documents such as MSDS, UN38.3 Certification, etc.
In addition to flexible shipping solutions, we also provide value-added services such as Amazon FBA labeling, product photography, free storage in China for 1-2 months, etc. With our one-stop sourcing services and rich experience serving Amazon sellers since 2015, you can entrust us to handle everything for China sourcing and just focus on marketing for business growth.
Join our 1000+ happy Amazon clients.
FAQ--What are the best products to buy on Alibaba and sell on Amazon?
Many people want to know the best Alibaba items to flip on Amazon. In reality, the product options vary for small and large sellers. For example, big sellers are likely to successfully promote popular products, with hundreds or even thousands of daily orders. Because they have sufficient money for stocking and advertising budgets to drive traffic, which greatly contributes to success.
However, it’s hard for small sellers to make success. Firstly, the product prices and logistics fees are higher than big sellers’, making it unrealistic to compete at low prices. Secondly, a limited marketing budget restricts the continuous running of ads to draw traffic, but popular products heavily rely on paid ads for promotion.
Our small Amazon sellers often begin their business with niche markets. For example, within the pet supplies market, most products cater to cats and dogs. Items like chicken helmets, leashes, and duck diapers, are niches targeting the needs of chicken and duck pet owners. Moreover, there is an increasing number of people adopting such pets, so relevant products enjoy market potential.
Get more product inspiration from JingSourcing Monthly Report