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Safe payments,safe sourcing

by Mike Bellamy

Why is it so hard to locate a “supplier” that will take payments by “Credit Card”? Are credit cards not USED by Chinese people? I ALSO have trouble finding one which will take payment through an “Escrow” service. How is an American “buyer” supposed to have any “security” on a business transaction? I was ALREADY “scammed” for $1000.00 which “just had to be” sent through Western Union. After they collected the money, I was NEVER able to contact them again. THAT happened on June 2nd. 

Let us look at each question one by one.

Why is it so hard to locate a “supplier” that will take payments by “Credit Card”? Are credit cards not USED by Chinese people?

The short answer is “unfortunately credit cards are not commonly used by suppliers in China.” The long answer is explained in the following blog posts:

Problems with companies accepting credit cards in China

Can I Buy On Credit from China?

I ALSO have trouble finding one which will take payment through an “Escrow” service.

As a buyer, I wish suppliers in China would get on the Escrow bandwagon. Many large escrow service providers from back home have been trying to set up platforms in China, but with very little success. The very very small orders can be placed using the escrow services (because the sellers do not trust it for medium and large orders) provided by the online supplier directories and a few sellers use PayPal. But for the reasons explained in “PayPal? How to Protect Myself as a Buyer?”, PayPal is not an option for the vast majority of transactions.

BTW, the small sellers may use ali-pay or take credit card or accept PayPal, BUT there are also a lot of small sellers who are scams. So be careful and watch this video: Video 8: Avoiding Scams

How is an American “buyer” supposed to have any “security” on a business transaction?

This video series is designed to answer that very question. The videos in bold should be of particular interest.

Video 1: Finding Suppliers

Video 2: Evaluating Suppliers

Video 3: Negotiations

Video 4: Project Management and Quality Control

Video 5: Protecting Your Intellectual Property

Video 6: Leveraging Global Sources

Video 7: How to Find and Manage Partners for Logistics

Video 8: Avoiding Scams

Video 9: Returning Defective Products

Video 10: Resolving a Dispute

The videos above are designed to help buyers who source factory direct. If you are not yet at that level, check out Small Buyers Strategies: Video Tutorials

I was ALREADY “scammed” for $1000.00 which “just had to be” sent through Western Union. After they collected the money, I was NEVER able to contact them again. THAT happened on June 2nd. 

Please watch video 8 above and let me know if the tips suggested would have helped you avoid the 1000 USD loss.  I realize it is too late to help you recover the funds if the seller disappeared, but perhaps you can get some satisfaction by exposing the scam at www.SupplierBlackList.com. This is a website where buyers list underperforming suppliers. So help other buyers avoid this bad factory by listing them online.

If you would like more tips and tools for dealing with vendors, check out http://www.chinasourcinginfo.org

Thanks again for your questions!


Question answered by Mike Bellamy, an Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center. Mike is also the author of "The Essential Reference Guide to China Sourcing" and founder of PassageMaker Sourcing Solutions.

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