When looking for suppliers on Alibaba, you may encounter many frequently used trade terms in the form of acronyms on both the Alibaba website and also by the Alibaba suppliers themselves. It is therefore important to be familiar with these acronyms to ensure that there are no miscommunications with your Alibaba suppliers.
Here are some of the most commonly used Alibaba Trade Terms:
MOQ - Minimum Order Quantity refers to the minimum number of pieces/quantity of a particular item that a supplier on Alibaba will require you to make before fulfilling your order
OEM – Original Equipment Manufacturing means manufacturing to order. An OEM factory makes the product based on the buyer’s design and specifications. You want to look for OEM on Alibaba if you’re interested in an original product of your own design.
ODM – Original Design Manufacturing is where the product is of the manufacturer’s own design. The buyer simply picks the product out of the manufacturer’s catalogue.
FOB – Free on Board means the supplier pays to deliver the goods to the nearest port while the buyer is responsible for transporting the goods from there onwards till their final destination.
QC – This means quality control and there are several types of quality control processes on Alibaba. There’s IQC (incoming quality control) relating to quality checks of raw material used to manufacture the product, OQC (outgoing quality control) for the finished product, IPQC (in process quality control) for activities conducted during the production process, and QA (quality assurance).
EXW - Ex Works refers to a shipping arrangement in which a seller makes a product available at a specific location, but the buyer has to pay the transport costs. This is how most suppliers on Alibaba work. Therefore you will typically need a find a Shipping Agent when buying from Alibaba.
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