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Alibaba vs. AliExpress: Which is Best for Your Business?

Threecolts
Geri Mileva
Published
February 9, 2024
Modified
February 9, 2024
alibaba vs aliexpress for your business

One of the ways online sellers can stay ahead of their competition is by expanding their reach and selling their products on other platforms. While Amazon still commands the lion’s share of the e-commerce market (especially in terms of revenue), Alibaba and AliExpress are considerable competitors.

Both platforms are owned by the Alibaba Group, but they fulfill a similar purpose: bringing products to their buyers. However, the key difference (especially for sellers looking to migrate to—or source from—either platform) is the terms of how you can buy the products you want from them.

Whether you’re looking into expanding your online storefront into these two platforms or searching for additional ways to source more products to sell on Amazon, here’s what you need to know about using Alibaba and AliExpress as an online seller.

Alibaba and AliExpress: What You Need to Know

Alibaba and AliExpress are both online e-commerce platforms where buyers and sellers can source products like Amazon. However, the way that they conduct their business varies in terms of their main demographic and the volume of items per order they handle.

Alibaba is a business-to-business or B2B-centric marketplace that focuses on wholesale retail sales, connecting manufacturers with resellers and other similar businesses. Products that you can expect to find on the platform include raw materials, office supplies, and packaging materials.

AliExpress is the business-to-customer or B2C-centric offshoot of Alibaba, which is targeted more at individual buyers who are looking to purchase products in smaller quantities. Potential purchases can vary from electronics, beauty products, clothing, and other consumer goods.

The two platforms have their own methods of managing the relationships between buyers and sellers. Considerations like pricing and shipping will differ depending on which platform you buy and transact with, especially if you’re looking to start a business or to scale up your operations.

Comparison With Amazon

The platform with the closest business model that can match Amazon’s is AliExpress, as it’s primarily marketed towards consumers who buy products individually or in very small quantities.

However, Alibaba also has an Amazon equivalent with Amazon Business, Amazon’s wholesale retail arm. Both these platforms are targeted towards businesses looking to sell to other businesses, though Amazon Business is a far more involved entity in sales compared to Alibaba.

alibaba and aliexpress comparison with Amazon

Key Differences and What They Mean to Sellers

There are several considerations that you’ll have to keep in mind once you decide to work with either AliExpress or Alibaba if you’re looking into them as potential product sources.

Minimum Order Quantity (MOQ)

A major factor that can affect your business costs is the minimum order quantity each platform can provide. Depending on your business goals and selling capabilities, one platform is objectively better than the other.

For businesses dealing with bulk orders or items that do well in long-term storage, Alibaba is the better choice. This is because the sellers on the platform often offer and require large minimum orders, meaning sellers looking to purchase wholesale will find Alibaba to have potentially more value for their businesses.

On the other hand, for businesses looking for smaller item quantities or businesses who don’t need to purchase in bulk, AliExpress is the better option for product sourcing and product testing. The minimum order requirements of the platform are just like most online marketplaces, and it’s far friendlier for sellers who may not have the immediate capital or space to purchase in large amounts.

Product Pricing

The actual prices that sellers will quote for their products are closely related to the minimum order quantity. 

Bulk purchases on Alibaba often favor larger order quantities that translate to a lower price per unit. This works well for sellers who want to source large quantities of products at the lowest possible cost.

Product prices on AliExpress will generally be higher per unit since they’re purchased individually. However, this is offset by the fact that you’ll only be purchasing in the quantities that you need, which can help avoid the risk that you’ll over-purchase goods for your inventory that you may not have the ability to sell.

Seller Negotiation

Each platform also has its way of handling how goods are purchased during their transactions. 

Unlike Amazon, Alibaba acts more like a middleman between buyers and sellers on its platform, leaving details like shipping and pricing entirely up to the two other parties. This can be advantageous if you’re experienced in negotiating prices and product fulfillment, as it gives you the flexibility to get the best possible deal for the products that you want to sell.

Like Amazon, AliExpress operates on a “what you see is what you buy” basis, where what’s advertised on the product listing is usually what you get. However, the platform is also responsible for the logistics of each purchase, which can reduce the need for your active involvement in how the product reaches your inventories after confirming your purchase. They offer various fulfillment options that range from affordable but take longer to deliver to more expensive but reach you faster.

Buyer Protection

Both platforms offer a form of buyer protection appropriate to the size of the orders they handle. 

Alibaba requires membership for businesses looking to sell on their platform. In addition, they have trade assurance, which offers escrow services to ensure orders are received and confirmed before payment is released. 

On the other hand, AliExpress guarantees refunds in the event that an order isn’t fulfilled. They also provide an on-time delivery guarantee and an extra warranty consisting of a 2-year guarantee on most of their products in most EU countries. 

Logistics

How a platform ships your order can have a direct impact on your timeline and is another key factor in deciding which option to purchase from.

Because of its buyer-seller negotiation model, Alibaba can be far more flexible with your fulfillment and shipping options once you’re done with your order. You can plan directly with your supplier and use their courier services or partner with a third-party freight or shipping company to have the products delivered to your area.

Like many marketplaces, AliExpress uses partner couriers (such as DHL and FedEx) to deliver products to you without the need to manage shipping yourself. All you need to do is pay a fee for the total cost of shipping your products, which can be easier for sellers who don’t have the time or resources to spend on trying to optimize shipping services based on cost and expediency. AliExpress offers AliExpress Standard Shipping as its most affordable shipping method, even offering it for free on occasion. However, depending on your receiving address, the delivery time may take longer compared to other courier options.

Why Use Alibaba?

Alibaba is one of the biggest marketplaces for B2B businesses in the world, and sellers can use Alibaba both to source and sell products. However, its biggest benefit for sellers is primarily in its capability to connect you straight to affordable wholesalers, retailers, and manufacturers. 

This is advantageous for several reasons:

  • It connects you directly with the entities capable of producing large volumes of supplies or products you can sell 
  • Direct contact allows more room to negotiate the finer details of your purchase
  • Guaranteed low-cost per unit pricing once you’ve managed to find a provider that suits your needs
  • Can be easily integrated into your overall product sourcing process with long-term partnerships
  • Ideal for white-label sellers that want to rebrand outsourced products on other places like Amazon

Selling on Alibaba is also possible, but given the high saturation of established players already present in the platform (and with most of its sellers based in Asia), it may not be a feasible idea for businesses looking to grow their business quickly. Product sourcing is, by and large, the best way to use Alibaba’s expansive reach and connections with reliable manufacturers and suppliers, helping you set a solid foundation for keeping your operations consistent long-term.

Why Use AliExpress?

Sellers who are looking to test the waters with their new products in other marketplaces can find AliExpress to be the far more suitable candidate. The platform is customer-centric and allows purchases for smaller quantities of items, lowering the risk of over-supplying for an under-demanded product. 

Some of the possibilities with using AliExpress include:

  • Doing a soft launch of products to test your potential profit margins
  • Getting a startup online business off the ground with its lower overall commitments, given its lower MOQ and set purchase processes
  • A far easier and more intuitive purchasing experience, as it’s built more similarly to other familiar marketplaces such as Amazon
  • Minimum programming experience required to work on the AliExpress platform
  • Allowing you to do competitor research on other potential products that you can sell to better price your own
  • Giving you an easier option to build a dropshipping model to sell your in-demand products without needing to worry about fulfillment
  • Offering a wider variety of products in terms of consumer goods

Is It Possible to Use Both Platforms?

Some marketers will ask: is it possible to source from and sell your products on both Alibaba and AliExpress?

Technically, you can. Considering that AliExpress is the B2C offshoot of Alibaba, you can create a business model that involves purchasing goods from Alibaba to sell on AliExpress. Given the freedom that you can take advantage of when negotiating your terms while buying from sellers such as direct manufacturers on Alibaba, it’s possible to have a very profitable e-commerce business by shuttling products between these two platforms.

If you have a larger business, you could purchase in bulk from Alibaba and sell them as individual units on AliExpress. For smaller businesses looking to scale, it's easier to test the demand for a product through single-unit purchases from AliExpress and sourcing the ones you discover to be high in demand from Alibaba.

Once you’ve purchased products that you’ve established to be high in demand and negotiated their price from Alibaba, you can distribute them across different online marketplaces to scale your business operations. 

What is the Best Choice for My Business?

Some questions that you can ask yourself when determining which platform will work best for your needs include:

  • Am I planning to buy my products wholesale (Alibaba) or in smaller quantities (AliExpress)?
  • How confident am I in my negotiating skills in securing a better deal when I purchase goods from Alibaba?
  • Do I have access to reliable fulfillment and logistics options once I’ve managed to find an Alibaba supplier for my goods?
  • What’s the goal of my business—to set up a foundation (AliExpress) or to scale its operations (Alibaba)?
  • Will I have the time and resources needed to research potential suppliers who carry the products I want to sell?
  • Do I intend to rebrand my inventory at any point (Alibaba), or am I comfortable selling other brands as is (AliExpress)?

Ultimately, your business goals, the current size of your business, and how much you're willing to spend will influence your choice. These platforms are not mutually exclusive, and you shouldn't feel locked into one or the other. You can use the services of both platforms at various stages of your business's growth.

How to Optimize Your Operations for Alibaba and AliExpress

No matter the use case you’ll have for Alibaba and AliExpress, you’ll need to optimize your inventory management and product sourcing to get the most use out of either platform. It’s possible to do this manually and navigate between each individual platform to manage them, but using external tools such as marketplace management software can make certain processes significantly easier to handle.

The following tools and software below are also helpful with managing the day-to-day operations of your e-commerce business, automating certain tasks, and ultimately freeing up your time and resources to focus on the things that matter to you the most in running your business.

Threecolts

Threecolts has plenty of marketplace management tools and services that can help any online business boost its overall performance. Many of its solutions are tailored to answer the everyday needs of e-commerce businesses, either by managing their operations or improving their customer service.

For sellers looking to source products, TacticalArbitrage helps you find the most profitable products to sell from hundreds of different websites. Compare everything based on your projected return on investment (ROI), competitor research, and sales velocity with ease. With a wide range of potential sources—from the biggest department stores to the lesser-known retailers—you’ll be able to find products with the highest profit potential.

On the other hand, ChannelReply is a customer-centric solution that allows you to collate all of your order data and messages in one platform. It can drastically increase your turnaround time for answering customer queries and concerns from various connected marketplaces as you view your customer information in real time. Enjoy all the data you need without having to switch tabs or platforms, and smoothly nurture potential leads from inquiries all in one place.

Yo!Kart

Yo!Kart is a multivendor platform that helps both startups and enterprise-level businesses alike scale their businesses on places like Alibaba. One of its strongest points is its industry-specific marketplace solutions that can cater to a wide variety of different business types, which is further supported by its growth-centric features.

However, it’s a platform that may be on the expensive side for startups. It will also require some programming and customization from enterprise-level businesses, which can impact timelines considerably if you’re looking to launch your business quickly. Despite these potential drawbacks, it’s still a potentially useful platform for growing your own e-commerce business while sourcing from sites like Alibaba.

CedCommerce

Sellers looking to expand their operations to AliExpress can consider using CedCommerce, a multichannel marketplace solution backed by robust AI integration. Sellers can automate tasks like stock management, product orders, and much more from a single dashboard.

But like most multi-channel tools and platforms, CedCommerce does require a steep learning curve to master correctly—which can be an issue that most startups or inexperienced sellers won’t necessarily have the time to address. Support from the platform developer is available, but users who may not be too technically inclined may find that the support fees pile up fast.

Cedcommerce

Alibaba vs. AliExpress: All About What You Need

For business owners looking to use Alibaba or AliExpress, the question boils down to: “What do I need from each of these platforms?” Answering that helps you leverage the unique strengths and selling points of each platform to further grow your business.

Alongside tools and platforms like Threecolts, online sellers can further expand their reach across different platforms with more easily sourced inventory and streamlined operations. Try the Threecolts platform today to learn more about which online solutions you can use to help your business succeed.