Like Alibaba, But Safer: HD Trade Services (YC S12) For Goods Traders
techcrunch.com
techcrunch.com
First off, I started selling electronic cigarettes with custom cartridges. When I found a demand I went to ali baba to get the e-cig kits for cheap. It was easy to find a supplier, but for sure the lady I am dealing with isn't the factory, but she has been good. Few qualms though.
For one, she didn't want to use the ali baba payment setup. So the first payment was a leap of faith. On my second order (for about the same amount of $) she sent me different kits than the first time because one e-cig was longer than the other. I didnt know I was getting a modified kit until I received about 500 of them.
My overall experience with this random company I met through ali baba has been a good one. Each time they have lowered my price and even dealt with the dead units I receive (Over 100 dead chargers thus far... I have been taking them apart and resoldering them myself, but they replace each one). Would be nice to talk to the factory directly, but the people on ali baba really helped me launch a company through an IM window.
My next solution was to try Western Union online. Their system is awesome. Took a couple of days to get my business approved (faxing docs and such) but then I was able to make the transfer no problem. Coincidentally, I messed up the account number and so after a week of the money not showing up in my distributors account Western Union corrected my error within 15 minutes of me realizing it. My third order the money went through in 10 hours and all of the account information was saved from the previous order, making it really simple.
Right now I email back and forth with my 'contact' in China. She is very good and really all I need to order goods. I noticed your site is a lot about tracking the products. I get a DHL tracking number before the products leave the facility and can watch them from HK to US. I don't have photos, but I am sure I could get them. I sorta like the gamble...
How are you guys going to stop companies from intercepting potential customers and getting them to pay directly?
We encourage buyers to route their goods through our growing network of inspection locations. These locations are neutral 3rd party logistics service providers (think DHL, except specialized in value added services like quality verification). They use our high definition inspection technology (http://www.hdtradeservices.com/distributor.php#inspection) to provide buyers with the ability to verify quality remotely, in real time. If the quality of the shipment does not meet your agreement with your vendor, you should not complete payment. It's a very proactive way to manage trade risk.
Let me know if you want to learn more.
All the best, Daniel
Would like to send you an email about possibly using your company for my next order (which would be next year). I have some basic q's and some more input on my past experience I would like to share and really I would like to learn more. Let me know if you are open to a line of communication.
me=midler.dave[at]gmail
I'd be aware when paying upfront, that it's almost certainly a when not an if that a shipment won't go through and your broker will disappear. Standard operating procedure here is to always screw with the money in the last batch before closing out of work... it's not always even the provider's fault, it can happen anywhere in the supply chain that you don't know about, but you'll feel it. So just budget in cash/inventory, and probably mentally/emotionally too, for your contact to disappear with your cash someday and you getting no product. If it doesn't happen, so much the better. But it could ruin your day if you're not prepared for it.
(I love China anyways... it's just the standards/controls aren't there yet. Ten to twenty years from now it'll be a non-issue. But take a couple minutes to protect yourself in the now.)
It is much harder to deal with the factory yourself. First of all, the quantities you have to buy are MUCH higer before they even wanna deal with you. Chinese agents mostly can get small quantities. Also, there is a language barrier. English language level is not really high, especially in the area where manufacturing happens. it is really YMMV... they often are not much better than the agents.. From what you tell here, it seems you are dealing with a good agent.
About the original article. What do they mean with 'safer' ? Security? Honesty?
Here's what we mean by 'safer'; our competing B2B International Marketplace (soon to be branded) is an integrated ecosystem of logistics service providers (neutral 3rd party logistics warehouses), suppliers and buyers. Our inspection, inventory management, and distribution management suite allows for real-time visibility (http://www.hdtradeservices.com/distributor.php#inspection), and facilitates a hyper-proactive approach to purchasing. The result is an unprecedented level of transparency and security when sourcing, as you can verify quality before your goods are paid for and shipped. Further, all suppliers on our platform will be rigorously vetted, and monitored via our inspection service.
I hope this helps answer your question.
It doesn't take much searching on Alibaba to find several companies offering the exact same item. Often with the exact same photo, with the only difference being the watermarks they slather over the shot.
Another more important service might be to offer on-site quality control. Of course, that might increase the cost over just taking photos, as you'd need people who were fluent in both Chinese (perhaps several dialects) and English; and who had domain expertise for the goods being manufactured.
You may deal with a middleman, but you certainly will not have to deal with order inaccuracy, bait and switch, low quality products or any other types of scams that are currently saturated in B2B marketplaces.
It will be interesting to see how you manage that!
A few things I find sorely lacking with Alibaba and China in general, some of which I'm sure you have in your crosshairs, others not so sure:
1. Language - Obviously English isn't their first language so some complications are to be expected, but:
a. I think there has got to be some serious disconnect going on between people with relatively proficient English speaking and writing skills, and companies that need that skill. I've been in contact with some rather large companies ($25+ million in sales or much more) whose sales people are just helpless.
b. Product Descriptions - sometimes just bad spelling/grammar or honest mistakes, but other times they're just plain wrong - like, differentiating details that are really important are ambiguous, or worse. Perhaps this is deliberate to a degree (which I would also like to see go away)
2. Culture - There's stretching the truth, and then there's lying, and it seems where this line is drawn varies greatly between cultures. It's very frustrating when you're trying to source a product, and every person you contact has it, in fact they have everything. Except they don't. Maybe there's something you could do along the lines of a comprehensive catalog of products, so when they list something, they "have" to tie it to a "fairly" strict item number(s), so I don't have to rely on text searches (which go against dishonest product descriptions). And, if they are doing a deal on 2 items and the buyer needs a 3rd, maybe you could somehow offer collaboration capabilities between sellers, ideally ones that they'd actually want to use (share the profit on a sale perhaps?)
3. Product listings - I'm sure you know all the issues here, but the ones that most bother me are the atrociously low-res pictures, pictures from other unrelated products the seller has listed showing when clicking "next", terrible ambiguous/misleading descriptions, etc.
4. Quality control - With modern technology, why some sellers don't do what your platform offers on their own (provide hi-quality photos, etc) is an absolute mystery to me, so it will be nice if you can show them how to do this, and affordably for them so it doesn't cut into their margins. However, for a lot of sellers, the total lack of quality control is a tremendous benefit to them so they can bait & switch, ship different product than ordered, etc.
5. Affordable Escrow service - as others have mentioned, a lot of sellers like to move transactions off the system. I hope you guys can resist the urge to take too much of a cut of the action and find some affordable way to provide security for the buyer and not cut into profits for the seller.
It's good to see some competition for Alibaba that's for sure, I really hope you guys can pull this off. I wish you the best of luck!
Their software doesn't really look like a "competitor" to Alibaba though. It looks more like something you'd use in tandem with the Alibaba marketplace to better keep an eye on your supplier.
This article announces a new platform connecting buyers with suppliers. Direct competition for Alibaba.
Here's some more information on the topic: http://haacked.com/archive/2007/08/21/i-knew-how-to-validate... [no affiliation]
We are working on solving the same problem with Tradesparency.com, but we are taking a different approach.
Good luck!
That said, if you can guys can pull this off, it looks like it should be incredibly useful.
(Disclosure: Roommate used to work there)