

Like Alibaba, But Safer: HD Trade Services (YC S12) For Goods Traders - dwshorowitz
http://techcrunch.com/2012/10/11/like-alibaba-but-safer-yc-backed-hd-trade-services-wants-to-become-the-primary-platform-for-goods-traders-in-china-and-beyond/

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rickdale
Having ordered about $30,000 worth of goods from ali baba this year, my
experience has been an interesting one.

First off, I started selling electronic cigarettes with custom cartridges.
When I found a demand I went to ali baba to get the e-cig kits for cheap. It
was easy to find a supplier, but for sure the lady I am dealing with isn't the
factory, but she has been good. Few qualms though.

For one, she didn't want to use the ali baba payment setup. So the first
payment was a leap of faith. On my second order (for about the same amount of
$) she sent me different kits than the first time because one e-cig was longer
than the other. I didnt know I was getting a modified kit until I received
about 500 of them.

My overall experience with this random company I met through ali baba has been
a good one. Each time they have lowered my price and even dealt with the dead
units I receive (Over 100 dead chargers thus far... I have been taking them
apart and resoldering them myself, but they replace each one). Would be nice
to talk to the factory directly, but the people on ali baba really helped me
launch a company through an IM window.

~~~
dwshorowitz
Thanks for your feedback, rickdale! Congrats on launching your business under
such uncertainty. We love hearing about experiences through B2B sites,
especially Alibaba.com. Although you haven't had any horror stories, which we
hear all too frequently, sounds like you've experienced a few curveballs. No
more curveballs! Help us build a truly transparent purchasing environment.

~~~
rickdale
The greatest challenge I have faced through this was transferring the money
internationally. My first order I did an international wire transfer from my
credit union and it took 7 days, went pretty smooth. My second order the
credit union had switched companies for processing wire transfers. Took them
over 30 days to finally return my money. They thought it was fraud; I tried to
explain to the wire transfer company that I had made the same wire transfer 3
months prior, but they weren't convinced.

My next solution was to try Western Union online. Their system is awesome.
Took a couple of days to get my business approved (faxing docs and such) but
then I was able to make the transfer no problem. Coincidentally, I messed up
the account number and so after a week of the money not showing up in my
distributors account Western Union corrected my error within 15 minutes of me
realizing it. My third order the money went through in 10 hours and all of the
account information was saved from the previous order, making it really
simple.

Right now I email back and forth with my 'contact' in China. She is very good
and really all I need to order goods. I noticed your site is a lot about
tracking the products. I get a DHL tracking number before the products leave
the facility and can watch them from HK to US. I don't have photos, but I am
sure I could get them. I sorta like the gamble...

How are you guys going to stop companies from intercepting potential customers
and getting them to pay directly?

~~~
dwshorowitz
Awesome feedback re: payment methods, thanks again for sharing!

We encourage buyers to route their goods through our growing network of
inspection locations. These locations are neutral 3rd party logistics service
providers (think DHL, except specialized in value added services like quality
verification). They use our high definition inspection technology
(<http://www.hdtradeservices.com/distributor.php#inspection>) to provide
buyers with the ability to verify quality remotely, in real time. If the
quality of the shipment does not meet your agreement with your vendor, you
should not complete payment. It's a very proactive way to manage trade risk.

Let me know if you want to learn more.

All the best, Daniel

~~~
rickdale
Daniel,

Would like to send you an email about possibly using your company for my next
order (which would be next year). I have some basic q's and some more input on
my past experience I would like to share and really I would like to learn
more. Let me know if you are open to a line of communication.

me=midler.dave[at]gmail

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gallerytungsten
This seems like the beginning of an interesting idea. But while they're
addressing the important issue of inspecting the goods, it seems they're
missing a more important concern when sourcing manufacturing in China. Namely,
knowing if someone is actually a manufacturer, or just a middleman.

It doesn't take much searching on Alibaba to find several companies offering
the exact same item. Often with the exact same photo, with the only difference
being the watermarks they slather over the shot.

Another more important service might be to offer on-site quality control. Of
course, that might increase the cost over just taking photos, as you'd need
people who were fluent in both Chinese (perhaps several dialects) and English;
and who had domain expertise for the goods being manufactured.

~~~
dsugarman
This is very true. You will not always know who is a middleman and they will
certainly be on our platform. What we can guarantee is that if you are dealing
with someone on our platform, they have never misbehaved before. We have
enough picture and video documentation to ban anyone who does, and our network
of suppliers is tightly monitored. You should never be scammed even if we did
not handle dispute resolution because of our inspection technology that makes
sure you can interact with your product before it is paid for and shipped.

You may deal with a middleman, but you certainly will not have to deal with
order inaccuracy, bait and switch, low quality products or any other types of
scams that are currently saturated in B2B marketplaces.

~~~
mistermann
> What we can guarantee is that if you are dealing with someone on our
> platform, they have never misbehaved before.

It will be interesting to see how you manage that!

A few things I find sorely lacking with Alibaba and China in general, some of
which I'm sure you have in your crosshairs, others not so sure:

1\. Language - Obviously English isn't their first language so some
complications are to be expected, but:

a. I think there has got to be some serious disconnect going on between people
with relatively proficient English speaking and writing skills, and companies
that need that skill. I've been in contact with some rather large companies
($25+ million in sales or much more) whose sales people are just helpless.

b. Product Descriptions - sometimes just bad spelling/grammar or honest
mistakes, but other times they're just plain wrong - like, differentiating
details that are _really_ important are ambiguous, or worse. Perhaps this is
deliberate to a degree (which I would also like to see go away)

2\. Culture - There's stretching the truth, and then there's lying, and it
seems where this line is drawn varies greatly between cultures. It's very
frustrating when you're trying to source a product, and every person you
contact has it, in fact they have everything. Except they don't. Maybe there's
something you could do along the lines of a comprehensive catalog of products,
so when they list something, they "have" to tie it to a "fairly" strict item
number(s), so I don't have to rely on text searches (which go against
dishonest product descriptions). And, if they are doing a deal on 2 items and
the buyer needs a 3rd, maybe you could somehow offer collaboration
capabilities between sellers, ideally ones that they'd actually _want_ to use
(share the profit on a sale perhaps?)

3\. Product listings - I'm sure you know all the issues here, but the ones
that most bother me are the atrociously low-res pictures, pictures from other
unrelated products the seller has listed showing when clicking "next",
terrible ambiguous/misleading descriptions, etc.

4\. Quality control - With modern technology, why _some_ sellers don't do what
your platform offers on their own (provide hi-quality photos, etc) is an
absolute mystery to me, so it will be nice if you can show them how to do
this, and affordably for them so it doesn't cut into their margins. However,
for a lot of sellers, the total lack of quality control is a tremendous
benefit to them so they can bait & switch, ship different product than
ordered, etc.

5\. Affordable Escrow service - as others have mentioned, a lot of sellers
like to move transactions off the system. I hope you guys can resist the urge
to take too much of a cut of the action and find some affordable way to
provide security for the buyer and not cut into profits for the seller.

It's good to see some competition for Alibaba that's for sure, I really hope
you guys can pull this off. I wish you the best of luck!

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mckilljoy
This is an industry that has plenty of room to grow, so I appreciate their
work.

Their software doesn't really look like a "competitor" to Alibaba though. It
looks more like something you'd use in tandem with the Alibaba marketplace to
better keep an eye on your supplier.

~~~
AVTizzle
Their old software was released before, and yes, it was complimentary.

This article announces a new platform connecting buyers with suppliers. Direct
competition for Alibaba.

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maxk42
Dear HD Trade Services: Your javascript email submit handler told me my email
was invalid. I hacked the source to accept my email anyway and it went through
fine. Please fix that.

~~~
dsugarman
Thanks for the feedback! We took a look and found that some special characters
were not passing our validation. We should have this fixed ASAP.

~~~
maxk42
For the record, the correct way to validate an email address is to send an
email to it. Don't try to validate in javascript, beyond maybe checking for
/.+@.+/.

Here's some more information on the topic:
[http://haacked.com/archive/2007/08/21/i-knew-how-to-
validate...](http://haacked.com/archive/2007/08/21/i-knew-how-to-validate-an-
email-address-until-i.aspx) [no affiliation]

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pjlegato
The site appears to handle logistics only. The comparison to AliBaba implies
that you can also find sellers/exporters. Can users source goods (i.e. find
exporters) on HD, or is it only for managing logistics once you've found a
supplier somewhere else?

~~~
dsugarman
Currently, we only handle logistics. We have been working on our marketplace
for some time and we want to launch the beta in early 2013. The purpose of
this wait list is to find out who wants to buy what products from where so we
can make sure to have only the most qualified suppliers as a part of our
network with the launch of our Beta. You can already use our inspection and
inventory services if you find a supplier elsewhere, but with the launch of
our marketplace you will be able to trade free of risk because we have more
documentation than any other service for dispute resolution, if someone
misbehaves, they are out.

~~~
pjlegato
Sounds good. I look forward to seeing the marketplace, thanks.

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Tradesparency
Awesome concept and idea! I hope you succeed so the bad suppliers lose
business and the small business owners win.

We are working on solving the same problem with Tradesparency.com, but we are
taking a different approach.

Good luck!

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joelrunyon
Sorry for the sidenote, but I have to say, seeing a (YC) next to a company
name that's not 2 words mashed together caught me by surprise :).

That said, if you can guys can pull this off, it looks like it should be
incredibly useful.

~~~
dsugarman
Thanks!

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retroafroman
I'm glad to see start ups taking on problems in the logistics industry. How
does your offering for warehouses and 3PLs compare with WMSs currently on the
market? Edit: Looks like you operate all in the cloud, is this correct?

~~~
dsugarman
Exactly. What we do really well is information capture using tablet computers
and storing the information directly in the cloud. Tablets can handle
signature capture, scanning, photos and video documentation right at check in
and check out so all the inventory is always synced. Our notification system
and inventory portal makes sure that the 3PLs client is always informed about
shipment activity. The biggest difference is probably that we can provide our
basic WMS at such a low price because we primarily make our revenue in other
ways that build off of this offering. Previously, smaller 3PLs were left out
entirely from WMS offerings.

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colinsidoti
The tagline "Like Alibaba, But Safer" makes me think of Panjiva.com - have you
guys heard of them?

(Disclosure: Roommate used to work there)

~~~
dwshorowitz
colinsidoti, thanks for bringing up Panjiva. We're very familiar with the
company, in fact I had an opportunity to meet Josh Green, founder & CEO, at
World Trade Week in NYC this past May. We really like what the company is
doing. Think of them like the google of international trade related search.
Just last week, they announced Global Search, which will seriously bolster
their service. Here's an excellent resource for learning more about Panjiva:
<http://panjiva.com/blog>

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austinlyons
Looks awesome. Know of anyone currently using their platform? Any feedback?

~~~
AVTizzle
It seems the platform doesn't open until early 2013.

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bitwize
Is that like "wanting to be the guy"?

