Those minimum orders are astronomical it's almost funny. Does anybody actually purchase manufacturing-level quantities of goods on alibaba? Genuinely asking.
Yes. It isn't like an eBay type transaction though, it's not 'just swipe your credit card'.
I never did oil, but I did do other commodities. It goes something like (in my experience, a typical Alibaba experience):
1. See a supplier with OK terms. Instantly distrust them.
2. Seek some kind of sample if this is first-time contact. Smell out how close they are to actual origination (usually far, far away, most easily detected by response time for sample, if so, avoid).
3. Experience pain waiting for sample then joy getting a sample and seeing it is consistent with claims.
4. Write contact with the correct incoterms based on sample above, which hopefully has been tested by an independent 3rd party that specialise in these things (this article is about oil, how about the same scale, but sun-dried tomatoes? Specialists exist, but are costly). Always use letter of credit for anything big, as the bank will bear responsibility, unless you really trust the other party and choose not to pay a fee state of mind. Make sure the contact is aligned to the letter of credit and you interests so the bank doesn't pass the buck to you if you didn't bother to write a decent contract. The bank will not hesitate to point out that the reason the coal was soaked as it was loaded at the incorrect point, or the required seal on the jars of the tomatoes didn't have a seal to stop them from from spoiling. There are limits to this, but the contract is enforced from terms and measures deemed 'reasonable' between corresponding banks, and for those that work in LC or trade in banking, 'reasonable' is a practical, not an academic, concept.
5. Profit (or bust, depending on how the above were done).
Alibaba doesn't make money on the cut (well some, not in the above, its too politically hot to handle), it makes it from both sides as an introduction fee. Due diligence is your business, not Alibaba's, and they explicitly make no promise for this.
How do people handle QC issues with Alibaba orders? I dipped my toe in when ordering a crate of allegedly "CE marked" chargers that turned out to be obviously unsafe, and haven't been back.
You receive samples first and check them. Another option is having an agent in find on your behalf perform QC before you pay the balance on your initial deposit. That's what I do..
