Alibaba vs. AliExpress: What Is Better for Your Business?

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Alibaba and AliExpress are both solutions to find a product supplier for your ecommerce business.

Both platforms are part of the Alibaba Group, a Chinese company that Jack Ma founded in 1999.

But although both platforms belong to the same company, there are essential differences between Alibaba and AliExpress.

In this article, you'll learn whether Alibaba or AliExpress is the better solution for your business.

You will also learn what you need to consider when sourcing a product on Alibaba or AliExpress.

Here are the contents of this article:

  • What is Alibaba?
  • What is AliExpress?
  • Differences Between Alibaba and Aliexpress
  • Similarities Between Alibaba and Aliexpress
  • Which One Should You Pick?

Let's start.

What is Alibaba?

Alibaba (Alibaba.com) is the world's largest B2B marketplace, founded by Jack Ma in 1999. The Alibaba Group (including Alibaba.com and AliExpress.com) has more than 117.600 employees and makes over 72 billion USD in revenue per year (2020).

As mentioned above, Alibaba is a B2B platform to search for manufacturers and suppliers. Businesses can buy almost any product on Alibaba from suppliers worldwide. 

Although every company can sell products on Alibaba, mainly suppliers from Asia – especially China – are active on the platform.

It's important to know that there are Minimum Order Requirements on Alibaba. Each supplier sets its own Minimum Order Quantities, and in most cases, this is between 100 and 500.

However, it depends on the supplier and the product. Some suppliers also have Minimum Order Quantities of over 500 units.

On Alibaba, you can get information like available product variations, costs, certificates, contact information, and so on. You can also contact manufacturers directly and negotiate with them.

If you are looking for a supplier on Alibaba, you should look for those who have a Gold Supplier Membership. A special agency has verified manufacturers who have this membership for their quality and legality.

On Alibaba, you can use several payment methods, and Alibaba also offers a secure payment and trade assurance program

Buyers can use this program to get a refund if a product does not meet the agreed quality criteria.

Manufacturers have to participate in this program, but not every manufacturer does so. Make sure to only work with suppliers who provide the secure payment and trade assurance program.

Also, Alibaba offers Alipay for suppliers in the wholesale program. Alipay gives buyers special protection by acting as a trustee in the buying process and ensuring that the manufacturer does not receive any money before the customer gets his products. 

I highly recommend learning more about Alipay here.

What is AliExpress?

AliExpress works differently than Alibaba because it is not a Business-to-Business marketplace. It's more a Business-to-Customer (B2C) marketplace like Amazon.

There are lots of sellers on AliExpress, and you can find almost every product. As with Alibaba, most sellers are from Asia, especially China.

AliExpress is especially suited if you want to do online shopping and are looking for low prices.

Since AliExpress is a B2C marketplace, there are no Minimum Order Quantities, which is especially beneficial for small businesses.

Like Alibaba, Aliexpress offers buyer protection. If you don't get your products, you'll get a full refund. Some sellers even offer a 60-day money-back guarantee.

AliExpress Money back

With 534.4 million visits per month, AliExpress is the fifth largest online marketplace in the world. Compared to that, Amazon has 5.2 billion visits per month.

However, while Amazon is only a B2C marketplace, AliExpress is a small mix of B2C and B2B. For example, if you order 100 units of a product, some suppliers will give you a discount on your bulk order.

The Differences between Alibaba and AliExpress

Although Alibaba and AliExpress belong to the same company, fundamental differences exist between the two platforms. Here are the most crucial differences between Alibaba and AliExpress listed:

  • Alibaba is a B2B marketplace, while AliExpress is a B2C marketplace. This difference between the two platforms is the most fundamental one. Alibaba is suited for wholesale transactions between businesses, while AliExpress is mainly for ordinary customers.
  • There are Minimum Order Quantities on Alibaba, but not on AliExpress.
  • If you want to purchase a product on Alibaba, you have to ask for a quotation. You can also negotiate with suppliers. On AliExpress, you can order products and pay in a second using PayPal or your credit card.
  • While you can get customized products on Alibaba, you can't get them on AliExpress.
  • AliExpress sells products that are already manufactured. On the other hand, Alibaba suppliers have to manufacture first the products they are selling.
  • You can use AliExpress for dropshipping, while you can't use Alibaba for dropshipping.

The Similarities between Alibaba and AliExpress

Although Alibaba and AliExpress have many differences, they also have some similarities. Here are the most significant similarities between Alibaba and AliExpress:

  • Both platforms belong to the Alibaba Group, which Jack Ma founded in 1999.
  • Most suppliers on Alibaba and AliExpress are from Asia.
  • You can buy products on Alibaba and AliExpress for a low price.
  • Alibaba and AliExpress both offer various payment methods and buyer protection.
  • The usability of both platforms is pretty good.

Which One Should You Pick?

It depends on your business model and many other factors whether Alibaba or AliExpress is better for your business. In the following, we will explain when you should choose Alibaba or AliExpress.

Alibaba vs. AliExpress #1: Dropshipping and Private Labeling

Private Labeling and dropshipping are different business models. Here are two short explanations:

Private Labeling

Private label products are produced for a specific reseller and sold under its own brand name. Private Labeling has two significant benefits:

You can sell your own products and build your own brand.

If you want to learn more about Private Labeling, check out this post on how to sell private label products on Amazon.

Dropshipping

You need an online store and a dropshipping partner to start a dropshipping business.

When a customer orders a product from your online store, you pass this order on to your dropshipping partner. 

Your partner then will take care of packaging and shipping the product to your customer.

Which One Should You Pick?

If you want to sell private label products, use Alibaba to search for a supplier. You can discuss specific product changes with suppliers on Alibaba. Furthermore, you can negotiate a better price and place bulk orders.

You won't find suppliers that offer private label products on AliExpress. You have access to millions of products, but you can't discuss product changes or print your logo on the products.

However, many suppliers on AliExpress offer a dropshipping service. So if you want to build a dropshipping business, you should use AliExpress.

Takeaway

Use Alibaba if you want to do Private Labeling. Use AliExpress if you want to build a dropshipping business.

Alibaba vs. AliExpress #2: Wholesaling

Wholesaling is buying products from manufacturers and reselling them to other commercial buyers. Whether Alibaba or AliExpress is better suited for wholesaling depends on your company's goals.

If you're looking for small quantities like 100 or 200 units, AliExpress is better suited. If you want to order large quantities, like 500 or 1000 units, Alibaba might be the right choice.

In most cases, Alibaba has lower prices than AliExpress. Let's take a look at the price of a drinking bottle on AliExpress:

AliExpress prices

On AliExpress, the price varies between $2.33 and $9.

Now, let's take a look at drinking bottles on Alibaba:

Alibaba prices

The prices on Alibaba are lower than on AliExpress. However, you have to place larger orders on Alibaba than on AliExpress.

When looking for products on Alibaba, always keep in mind that the real product manufacturer offers the lowest price in most cases, and several resellers sell the products for a higher price. 

Therefore, you always need to buy products from the real manufacturer. Contact the responsible person and ask if the seller is the real manufacturer to be on the safe side.

Takeaway

If you're looking for small order quantities, choose AliExpress. If you're looking for large order quantities, Alibaba might be the better solution.

Alibaba vs. AliExpress #3: Minimum Order Quantity

The Minimum Order Quantity (MOQ) is the minimum number of products you have to order from a supplier.

On AliExpress and Alibaba, Minimum Order Quantities are very different. On AliExpress, you can order one unit, while on Alibaba, you see minimum order quantities of 50…500 or more.

That's because, on Alibaba, most products are customizable. You can discuss specific details with your manufacturer, print your logo on the product, or change its color. On AliExpress, the products are not customizable.

Takeaway

If you want to order small quantities, AliExpress is the more suitable option. If you want to place large orders, Alibaba is the better choice.

Alibaba vs. AliExpress #4: Delivery Time

Everybody knows that it's essential to have enough units available to sell them online. If you don't have products available, your potential customers will shop elsewhere and spend their money on your competitors.

AliExpress

As already mentioned, on AliExpress, you can buy products already produced. The delivery time is about five to 40 days. In most cases, it's about five days.

Alibaba

The total processing time includes negotiation, production, and delivery time.

This can take 20 days to 6 months. The more complex your customization needs, the more time the process will take. Production time can take up to 30 days.

Shipping time depends on whether you want your products shipped by sea or air freight. Sea freight can take up to one month.

If you don't need any specific product changes, the total processing time will be significantly shorter.

Takeaway

If a short delivery time is important, choose AliExpress.

Alibaba vs. AliExpress #5: Delivery Costs

You have to pay delivery costs when ordering products. On AliExpress and Alibaba, delivery costs are very different.

AliExpress

On AliExpress, you can even order products free of charge. You can also filter products by Free Shipping.

AliExpress Shipping Costs

You have the choice between different shipping service providers, delivery times, etc...

AliExpress Shipping

The delivery costs between $1 and $3 for each product. Keep in mind that the more products you order, the more you will have to pay. For example, for 100 units, the shipping costs are $71.

Alibaba

Alibaba works in a different way. It depends on what you agree with your supplier. For example, your supplier can be so generous and send you the sample for free - that's very rare, though.

It's always cheaper to go for sea freight, as air freight is much more expensive.

Here's what you have to pay:

  • Load
  • Docking ship
  • Documentation
  • Sea freight from China to the US
  • Unload and transport to your destination/warehouse

All this with taxes, high season delays, and other transaction fees. You will probably have to pay $2,000, if not much more, especially if you order a lot.

Takeaway

Alibaba is better for bulk orders, and AliExpress is better for small to medium quantities.

Alibaba vs. AliExpress: Conclusion

There are two things to keep in mind when choosing between Alibaba and AliExpress: The goals and budget of your business.

If you have a big budget, you should use Alibaba to order higher quantities and pay less per unit. If you have a lower budget, use AliExpress, as you can order fewer products.

Alibaba is indispensable for Private Labeling. Alibaba allows you to negotiate with the manufacturer, make product changes, and build relationships. On the other hand, you should use AliExpress to build a dropshipping business.

With AliExpress, you get products much faster than with Alibaba. There are also suppliers on AliExpress who provide free shipping. On Alibaba, you will have a hard time negotiating free shipping with your supplier.

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