Profiles

QualityTrade has clocked up 12,000 members, taking aim at Alibaba’s unsatisfied customers

- November 21, 2014 3 MIN READ

With a market value of around USD$250 billion, you would think that trying to take on the e-commerce giant that is Alibaba.com would be a stupid, if not a nearly impossible task. The beauty is, when a company is worth that much, and has a monopoly of an industry the size that Alibaba does, there will likely be tens of thousands of unhappy customers. Online wholesale startup QualityTrade saw this as an opportunity and decided to take advantage.

Founded by Nigel Johnston, QualityTrade launched in August this year; and in the last three months has clocked up over 12,000 members. The key to its success? Making it easy for customers that have been poorly served by Alibaba.com to fulfil their wholesale import requirements.

In a media statement, Johnstone said that one of the key differences between his company and Alibaba is in the algorithm.

QualityTrade’s algorithm lists suppliers and products by their quality, while on Alibaba.com whatever supplier ponies up the most advertising money gets ranked first – even if another supplier has a better product.

This begs the question: how can an Australian-based business adequately determine the quality of the suppliers that are listed on its site? An important feature of the company is that QualityTrade use their own team of analysts and auditors who verify data after a company has chosen what package of QualityTrade’s ‘verification level’ pricing it would like to go with. Independently verified suppliers get a higher ranking when their data and quality claims have been proven.

QualityTrade, depending on the package chosen by a supplier, provides credential, financial and onsite facility verification and compliance benchmarking. The suppliers that benefit the most from this ‘vetting system’ are those that pay an annual fee between $1,500 and $5,950 which means that QualityTrade actually visits the suppliers at the top end and personally endorses their services – something that holds a lot more weight than just a customer testimonial.

After the initial set up, that’s when the algorithm kicks into gear. Everything within the system is based on merit; suppliers are unable to pay their way to the top – higher exposure is given in a reward-like way for providing impeccable customer service to the users. It is constantly working in real-time based on customer feedback and verification status.

There are two other key features that stand out on the website, that, for an importer of goods are even more attractive than the primary self-service model of the website. The first one is a ‘sourcing’ feature, where if you are specifically looking for a product and can not find it, the QualityTrade team will go about sourcing options for you. The second is a ‘tender’ feature, in which a user can put their request out to tender and suppliers on the platform can see this and begin to pitch for that person’s business accordingly.

Both of these above features are critical when it comes to newcomers to the wholesale / e-commerce space. There is nothing worse than making massive, and quite often costly mistakes when you are just kicking things off in online retail. QualityTrade is able to act as a local safety net of sorts.

For the moment, Johnston has said that he will be keeping the company bootstrapped, focusing on getting everything ‘right’ before likely seeking venture capital once financial runs are on the board – he is aiming at going for a higher valuation than what he would get now. With a background as an analyst in venture capital and investment firms, it is easy to make a presumption that he knows what he is doing when it comes to this side of the strategy.

With a clean user interface, intuitive search functionality and easy-to-navigate user experience, I can see QualityTrade becoming a very popular tool within Australia’s ecommerce sector.

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