Supply Chain Management: Comparing Alibaba and the Canton Fair

We recently wrote a two-part blog about sourcing from China using supplier platforms like Alibaba, Sourcing From China: The difference between Alibaba and doing it yourself. In this two part series, we discussed sourcing through Alibaba and how this differs from traditional importing.

Most veteran importers have attended the Canton Fair at least once. And most new importers have made a purchase from Alibaba at least once. In this blog I explore how they compare and what the pro’s and con’s of each are.

Sourcing from China using Alibaba

This is by far the most popular platform for new importers. And much like the Canton Fair, you have a vast array of products available to you from many different suppliers.

The Pro’s:

· You don’t have to go anywhere. You can buy virtually from the comfort of your own home. So you save the travel costs, the accommodations and the time it would take to visit China.

· You can search for any product in an instant and get lists of suppliers and products to choose from.

· Alibaba provides a rating for every supplier and does part of the verification process for you, which is nice to have part of the due diligence work done for you.

· Suppliers will communicate directly with you, they can also send you samples etc.

The Con’s

· You don’t really know who the suppliers are.  Are they for real? Do they own their own factory?

· You don’t really know what you’re getting. You can see photos of the products, and you can even get good samples but you can’t really verify the quality of the production or be sure that the end-product you will receive will conform to your quality requirements.  You also don’t really know if the products will arrive on time.

· Payment: There is a risk involved in placing orders via Alibaba. You MUST do your due diligence and make sure you are dealing with a legitimate supplier before sending any money to them.

Sourcing from China via the Canton Fair

Every year, twice a year, importers flock to China to visit the Canton Fair in the South of China.  Here, they typically scout new suppliers, get new product ideas, get to see and feel the product, and negotiate pricing, quality and delivery.

The Pro’s:

·You get to meet with suppliers and factory owners directly and establish a basis for a business relationship. You can also collect information from several suppliers to compare on the spot.

· You can even set up a time to tour/visit/inspect their factory.

· You can touch, see and feel the quality of their products and determine how well they would be capable of making your products.

· Suppliers from every industry and all parts of China participate at the Canton Fair. So, as long as your product can be made in China, you are bound to find something. This is the largest and most organized trade fair in China.

· Because the Canton Fair is split into three phrases over three days, you should plan ahead, study which session suits you best and choose which day you will attend.

· Because Guangzhou (Chinese Pinyin for the old name of “Canton”)  is a short trip from Hong Kong, and because Hong Kong schedules other exhibitions around the time of the Canton Fair, you may find it valuable to visit there as well.

The Con’s

· Travel expenses can mount up. You want to make sure that if you’re going to make the trip, you make it worth while.

· This kind of trip takes time.  You must figure at least 4 days.  And because China is far and in a different time zone, you will also deal with jetlag.

· This is a massive fair which brings buyers from all over the world. Visiting such an exhibition is tiring, a lot of walking and sometimes, sensory overload.

Both of these platforms are useful.  It is a matter of when and how. Each platform has its benefits and its downsides. What are your experiences with each? Share your thoughts with us below.

 

By Jocelyn Trigueros