number of actions you can take to research your potential business partner whom you have met on the internet



Check the Partner's Background

Background checks from independent third-party sources include a search for legal registration and credit reports. In many countries the existence of a company and its legal status is a matter of public record. check with the companies registry in the partner's country to ensure that the company exists with a valid registration. If you cannot have independent access to your partner's registration information, ask your partner to provide you with a Certificate of Good Standing issued by the companies registry of his country or state/province. You can also gain further knowledge about your partner by ordering a credit history report from a local credit agency. Credit history reports contain information about the partner's business history in their relationships with banks and other trading partners. Go to contact credit agencies which can provide credit history reports.

Meet Your Partner in Person

Whenever possible, meet your business partner in person and visit his company's facilities. While the internet offers you a wealth of information on your potential partner which enables you to make an initial assessment, there is no substitute for face-to-face contact. If you would like Alibaba to arrange a face-to-face meeting with suppliers in our China Supplier or TrustPass community, please contact our Buyer Service team.

Protect Yourself When Ordering or Providing Samples

As a buyer, order a sample before committing to a purchase order to be sure that the product meets your expectations. As a seller, request payment for a sample and/or payment for shipping costs before you send out the sample, especially if your product has a high resale value.

Use Pre-Shipment Inspection Services

If you are a buyer, you can protect yourself against poor quality by ordering a pre-shipment inspection of the products. You can demand the inspection as a condition to payment.

Protect Yourself Against Payment Risk-You Are the Seller

If you are a seller and have not been doing business with your partner for very long, avoid selling your products on open-account (in which case you are extending credit to your buyer). Instead ask your buyer to open a letter of credit (an "L/C").

Protect Yourself Against Payment Risk-You Are the Buyer

If you are a buyer, sometimes a supplier may ask you for a deposit (usually 30%) before he accepts the order. While this is not unusual between long-standing trading partners, if you are doing business with the supplier for the first time, make sure you have done sufficient background checks on the supplier before you agree to the deposit, or ask for a different form of payment, such as a letter of credit. If the seller seems more focused on payment than any other issue, or indicates that cash payment must be made urgently, more caution should be given to the transaction. Be extra cautious when the seller asks you to send money to an account whose real owner cannot be traced; for example, you cannot trace the real name of the person behind an account with a wiring service such as Western Union.

Suspect Shipping or Contact Addresses

Pay close attention to shipping or contact addresses located in regions with high reported incidences of online fraud, such as Eastern Europe, Western Africa and Central America.