payment method for new supplier?

lightspeed

Hi

Im sourcing some raw materials and i found a company based in the EU on alibaba.

Their website looks legitimate and they are a registered company.

Ironically though id feel more secure dealing with a company in China. The reason i say that is that at least with established chinese companies from what ive seen and read, most offer alibaba's trade assurance.

Also i read that most scammers cant afford the yearly fees for gold status particularly after the 2nd year when fees apparently increase a lot more. This supplier unfortunately has only 2 year gold supplier status.

My only worry is that the only payment method the supplier appears to accept is through bank wire transfer.

I read that alibaba have a service where you can pay into an alibaba wire transfer account and they release funds to supplier when the buyer confirms receipt of the goods.

When i mentioned this to this supplier, he responded saying that alibaba charge enormous fees for this if company registered in EU and not China. I thought this was a big red flag but then i chatted online with Alibaba and they confirmed that they only offer this service to Chinese suppliers and not EU companies.


It may well be all legitimate but im completely new to sourcing supplies and materials so im not sure of what the norm is?

The supplier is saying they require prepayment as this is first order ive placed with them.

Can anyone advise what is the normal payment method and procedure when buying from a company for the first time?

Thanks

Walter2016

Do a credit reference check on the company (their details should be accessible by mist credit check places) and also ask them for the names of a couple of UK / irish companies they already deal with.

But bank transfer would be quite normal.

Hanley

Is there any sort of escrow company that exists for scenarios like this?

...and if there isn't, there should be!

jimmii

Hanley wrote: »

Is there any sort of escrow company that exists for scenarios like this?

...and if there isn't, there should be!

There's loads. Transfermate would be a handy one and save a few quid on the exchange too!

lightspeed

jimmii wrote: »

There's loads. Transfermate would be a handy one and save a few quid on the exchange too!

Thanks i might suggest an escrow as method of payment and see how open he is to it.

Do you know what kind of protections if any are in place when dealing with a company registered in another EU country that fails to deliver after payment?

Of course that amounts to a breach of contract, am I correct to assume the legal remedy available would be to just sue for breach of contract?

Are any other mechanisms available?

Websites4u

I think you would just have to risk it but not with too much money. also dodgy if they dont accept money over paypal or any other method. you have recourse that way, wouldnt say you have much recourse with bank transfer to another country. also, have they reviews on their website or independent site like google , facebook or alibab? Then you will know their real value!

pedroeibar1

What is the value amount of your order? How much are shipping costs? Total? Prepayment for a first order is common.

MOH

I ordered stuff in the past from a well established UK company, and it was prepayment by bank transfer for the first order. Seems standard enough, so wouldn't let that alone put you off.

Websites4u

any update? what did you do in the end? another option, is escrow, where Alibaba woudl hold in escrow until goods are delivered!