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eCommerce Blog / Smart sourcing steps to protect you from being ripped off

Smart sourcing steps to protect you from being ripped off

For all the sellers out there, from the brand-newbies to the veteran sellers who can recall the good old days back in '95 when eBay was free, one of the most fearful parts of selling online is the risk of being ripped off by phony suppliers.

The Internet is an anarchic system and there is plenty of room for scams and crooked deals that can cripple online businesses. To avoid becoming just another scam-sucker falling victim to the latest con-artist, you've got to be smart and stay informed. Here are some steps to take when searching for new ventures that will help keep you, and your money, safe.

1.  Do your own background check on potential suppliers

Many phony suppliers don't last long. It doesn't take long for their name to be slandered on public forums and for potential victims to become aware of them. Therefore, finding out how long someone has been trading becomes really important. A great way to check up on potential suppliers is to use Domain Tools, an online tool which allows users to search the domain name and see when the site was created.

We recommend using only suppliers that have been operating for more than two years, anything less can be very risky. Another tip is to check when the domain expires. If they have only paid for a domain to run for a year or two, they may well be a serial scammer who makes site after site and abandons them once they are exposed.

2.  Check for safe payments options

To help ensure that your money is safe when making payments, you should avoid using wire transfers or money orders and instead use safe options such as Paymate, PayPal, and credit card payments, as they provide some security to buyers by being able to reverse payments made in fraudulent transactions.

Be very careful with suppliers who insist that you pay via a wire transfer because the cost of your order exceeds the maximum daily transaction limit of your payment service provider. Instead, you should make multiple transactions over the course of a few days. It may mean you get your shipment a few days later but at least you know your money is safe. That said, most service providers have daily transaction limits of around US$10,000 so it won't be an issue for most of us!    

3.  Check the supplier’s contact details

Check through the supplier's website and look for contact details. Make sure you can find a landline phone number, an email address and a physical address (Google Maps can help you determine whether the street name and number actually exist but remember this feature is unavailable for Chinese addresses).

If all that is offered by the supplier is a cell phone number and a funny looking email address from a free provider (e.g. andy99574@hotmail.com or joe_smoe@yahoo.com) then you may be looking at the site of a genuine fraudster!   

4.  Test them!

There is nothing like a good old fashioned pop quiz to expose a crooked supplier.

You can test their legitimacy by giving them a call on the numbers they have listed. When they answer the call, listen carefully to what they say, if you get a basic 'yes?' rather than a more professional 'Discount Apparel, Lisa speaking', it may be a sign that the supplier is illegitimate or even that they are using the same number to run a number of shady businesses. Check also that the name they use on the phone matches the name they use to sign off emails.

You can also test their legitimacy by simply searching for them on the SaleHoo Suppliers Directory. If they are listed here they are guaranteed to be safe for you to trade with. You can also perform a search for their trading name in the SaleHoo forum and see if any information on them comes up.  

5. Take a close look at the website

Most reputable suppliers will invest in a great web site which looks professional, is easy to navigate and is full of product information. Some dubious suppliers will avoid having to spend money on a web site which they know will only last a few months until they are exposed as an untrustworthy supplier. A great web site which has had time and money put into it should have:

•   Good branding such as logos and consistent use of company colors.

•   Professional looking product pictures (that don’t look like they have just been copied from another site).

•   Good dimensions. The number one rule of web design is that the home page should never need for you to scroll down for any more than 2 pages of information.

•   No pornographic advertisements. Many free-to-use and free-to-host websites will use pornographic ads on the site to make up for the fact that it is free, some scammers will use these sites to save money.

A good web site, along with the other pointers listed above, cannot guarantee a reputable seller but it can certainly help to get a feel for the supplier and help determine whether you think they are someone you can trust.

We love hearing about other tips and tricks to help distinguish the good and the bad suppliers out there so let us know if you have any of your own tips you want to share with other members and please remember that if you do come across a untrustworthy supplier, to add them to our Name Them! Shame Them! thread on our forum.


Comments (5)

  Already a member? Login to comment
CJ on 13:29 7 Apr
I have not started a business on line yet, I am still gathering information, however, I felt reading this and all of SaleHoo's writings to be very informative. Thanks!
rickey carrier on 0:23 9 Apr
this is true for USA sellers but in the import market it's not true because they all have high tech websites, if you deal with out of country sellers, use a trade manger and trust no one, use paypal or ESCROW ACCOUNTS , I FOUND OUT THE HARD WAY, THE OLD SAYING IS YOU LIVE AND LEARN......
Jaime Statham on 21:12 23 Sep
GREAT read :) I finally launched my site but still trying to make sure I buy authentic items from people-can't sell something that is fake :/ Best of luck to everyone!
cindy on 4:08 15 Jun
Does it have to be PayPal ? Can it be conceal cash?
Irene Vallejo on 15:33 15 Jun
@Cindy: Yes, Paypal is one of the safe methods that you can use. Sorry but I am not sure what you meant by "conceal cash". For further questions just send us an email at http://www.salehoo.com/support :)


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