Steps to Negotiate With Alibaba Suppliers
Next, let’s negotiate with our suppliers and see if we can get a lower cost for our small orders. You can’t start an Amazon business with good negotiations!
Best case scenario we can even get a credit back on the sample products.
If you see on the bottom right hand side of the photo you can click on “contact supplier”.
You don’t order right away on Alibaba. You need to contact the supplier and explain to them what you want and to give you an estimate.
Step 1: Contact the supplier and start the conversation
We’re not going to leave this to chance. We’ve tested so many emails to suppliers and we’re going to share one of the best emails you can send.
The idea is to create an open line of communication between you and your supplier.
People become very nervous at this step but suppliers are people too and just need to know how they can help you.
Introduce yourself first and then you can let them know that “your boss” is unhappy with your current supplier and would like to move to another supplier.
Copy and Personalize This:
Alibaba Supplier Negotiation Template
Step 2: Use This Alibaba Supplier Negotiation Template
Dear NAME,
We cannot divulge secretive information like monthly sales volume. Based on what you have told me / what I have seen , your volume is enough for us to be interested in your factory, especially given your broad range of products and your focus on quality control.
However, my boss is not willing to switch accounts / my boss is not willing pay for samples to any new supplier until we prove things out by moving slowly. The steps he would like to follow are:
We test a normal and high capacity cartridge internally in the field with our 20 sales reps = 40
Then we test on a broader scale with 100 units, preferably with a different printer line =100
After, we move to 1,000 units to test happiness with customers in our many channels of distribution =1,000
Assuming all goes well, we go to 5,000-10,000 units and really begin to migrate to your factory fully for that line = $
Your factory seems like a great potential partner for our company, and we’re excited to do business with you. But this is our company’s standard procedure for new products and suppliers.
Please let me know if you’d like to do business together, and I’ll let my boss know immediately.
Look forward to working together,
YOUR NAME
Step 3: Set the Proper Expectations
If you do this and maintain your position as an assistant or purchasing manager, it will give you the necessary negotiating strength to get started.
Just be sure to set reasonable expectations of growth and have them understand that there are validation and inspection processes to go through in order for them to earn your company’s business.
Once you send the initial inquiry you’ll come to this screen and you’ve made contact with your first supplier! They will email you back and ask for specifics. It becomes a conversation at this point and you tell them what you want.
Step 4: Agree on the price and place your first small order on Alibaba
Alibaba Shipping Hack
Remember a small order can be anywhere from 5 to 20 units. It depends on your level of risk tolerance. Expect to pay around $150 to the supplier for door to door small test orders. And remember that the de minimis value for e-commerce parcles to the USA was raised to $800 USD in March 2016.
Therefore international courier shipments and/or international parcel deliveries can be cleared without duty and taxes!
It’s your responsibility to make sure that when the products arrive at your house that you inspect them and prep them for FBA.
The video shows you how to get your supplier to ship your products to your house.
Dealing With Shipping Costs
Startupbros rules to live by:
- Product research is more beneficial to the profit margin than trying to lower your shipping costs.
- Anywhere from $50 to $150 is reasonable for shipping costs
- If we’re asking them to express ship it via air then we should expect a higher shipping cost
Keep this in mind when receiving a quote from a supplier and consider a new product before thinking $50 to $150 in shipping costs is unreasonable.
