How to Avoid Getting Scammed by Fake Suppliers
- 16 min Read
- Beginner Freindly
- Checked by Chris Stone
Starting an online business — whether it’s dropshipping, wholesale, or private labeling — is one of the most exciting decisions you can make. You imagine choosing winning products, launching your store, and finally creating an income stream that gives you freedom.
But there’s a side of online business that no one talks about enough.
Fake suppliers.
Unfortunately, supplier scams are one of the most common reasons beginners lose money before making their first sale. And the worst part? Most of these scams are completely avoidable — if you know what to look for.
In this in-depth guide, you’ll learn:
What fake suppliers are and why they’re so dangerous
The biggest red flags most beginners miss
How to properly research and verify suppliers
Safe payment methods that protect your money
Common supplier scams you should avoid at all costs
Best practices to build long-term, trusted supplier relationships
If you’re serious about building a legitimate, long-term online business, this is advice you cannot afford to skip.
Why Fake Suppliers Are a Problem
Fake suppliers aren’t just annoying — they can destroy your business before it even starts.
Many beginners assume scams only happen to careless people. The truth is, scammers are getting smarter, more professional, and better at targeting new entrepreneurs.
Here’s why fake suppliers are so dangerous:
1. You Lose Money Before Making Any Sales
Most supplier scams involve upfront payments, “setup fees,” or fake inventory deposits. Once the money is sent, the supplier disappears — and there’s no product, no tracking number, and no refund.
For beginners on a tight budget, this can end the journey before it begins.
2. Your Brand Reputation Is Damaged
If customers place orders and never receive their products — or receive extremely poor-quality items — they’ll leave bad reviews, request chargebacks, and report your store.
Even one bad supplier can permanently damage your brand.
3. You Lose Valuable Time
Time is one of your most valuable assets. Many fake suppliers drag things out with excuses, fake tracking numbers, and delayed responses. By the time you realize it’s a scam, weeks or even months are gone.
4. Fake Suppliers Don’t Care About Your Goals
They don’t care about your store, your dreams, or your future. Their only goal is to extract as much money as possible before moving on to the next victim.
That’s why you must protect yourself first.
What Are Fake Suppliers?
A fake supplier is a person or company that pretends to offer real products or fulfillment services, but in reality:
They don’t ship products at all
They ship counterfeit or extremely low-quality items
They disappear after receiving payment
They steal product photos from legitimate suppliers
Fake suppliers often target:
New dropshippers
Small business owners
Entrepreneurs searching for “cheap suppliers”
If you’re not careful, they can look very convincing.
Red Flags of Fake Suppliers
Knowing the warning signs is your first line of defense. Below are the most common red flags that signal a supplier may not be legitimate.
1. No Verified Business Information
A real supplier should have:
A registered business name
A physical business address
Tax or registration numbers
Clear ownership information
If you can’t find any official records — or the information seems vague — proceed with extreme caution.
2. Prices That Are Too Good to Be True
If a supplier offers products at 70–80% below market price, that’s a huge red flag.
Legitimate suppliers operate on thin margins. They cannot sell products far below wholesale prices and still remain profitable.
Cheap pricing often means:
Counterfeit products
Non-existent inventory
Bait-and-switch scams
3. Poor Website Design and Low Professionalism
Many fake supplier websites:
Have spelling and grammar errors
Use stolen product photos
Lack detailed product descriptions
Have broken pages or missing information
Professional suppliers invest in their online presence because their reputation matters.
4. No Clear Refund or Return Policy
A trustworthy supplier clearly explains:
Return conditions
Refund timelines
Damaged or lost shipment policies
If this information is missing — or intentionally vague — walk away.
5. Pressure to Act Fast
Scammers love urgency.
Phrases like:
“Last chance”
“Only today”
“Limited supplier spots”
are designed to make you act emotionally instead of logically.
6. Requests for Large Upfront Payments
Real suppliers may ask for:
Small sample fees
Partial deposits
But demanding large upfront payments without proof of legitimacy is a major warning sign.
How to Avoid Getting Scammed by Fake Suppliers
Avoiding scams isn’t about luck — it’s about process and verification.
Step 1: Research the Supplier Thoroughly
Never skip this step.
Check Business Registration
Search for the supplier in their country’s:
Business registry
Trade directories
Government databases
Most legitimate businesses are required to be registered.
Look for Online Reviews
Search:
Supplier Name + reviews
Supplier Name + scam
One negative review isn’t always a dealbreaker — but patterns of complaints are.
Step 2: Verify Contact Information
A real supplier should have:
A professional email address
A working phone number
A physical address
Try contacting them directly. Ask questions. See how they respond.
Scammers often:
Avoid calls
Delay replies
Refuse video meetings
Step 3: Ask for Product Samples
Legitimate suppliers almost always allow samples.
This helps you:
Verify product quality
Check packaging
Confirm shipping times
If a supplier refuses to send samples, that’s a serious red flag.
Step 4: Use Supplier Directories (Carefully)
Directories like:
Alibaba
SaleHoo
Doba
can be helpful, but they’re not guarantees.
Always double-check suppliers even if they’re listed on popular platforms.
Safe Payment Methods to Protect Yourself
Your payment method can be the difference between losing everything and getting your money back.
Best Payment Options:
PayPal (buyer protection)
Credit cards (chargeback options)
These give you leverage if something goes wrong.
Payment Methods to Avoid:
Wire transfers
Western Union
Cryptocurrency (for first-time suppliers)
Once that money is sent, it’s almost impossible to recover.
Smart Payment Strategy:
Instead of paying 100% upfront:
30% deposit
70% after confirmation or shipping
This reduces your risk significantly.
Common Supplier Scams You Should Know About
1. Counterfeit Product Scams
Selling fake branded items (Nike, Apple, Adidas) at cheap prices.
This can:
Get your store shut down
Lead to legal action
Destroy your brand
2. Hidden Fee Scams
Suppliers suddenly add:
“Customs fees”
“Handling fees”
“Shipping surcharges”
after you’ve already paid.
3. Fake Dropshipping Directories
Websites that sell “exclusive supplier lists” filled with:
Outdated contacts
Fake companies
Publicly available data
4. The Disappearing Supplier
The worst scam:
Payment sent
Supplier stops responding
Website disappears
Ready to Start Your Dropshipping Journey?
Learning how to start dropshipping with no money is just the first step. If you want a clear roadmap with proven strategies, I’ve put together a Free 4-Day Dropshipping Training that will show you exactly how to:
Pick winning products that actually sell
Set up a store without wasting time or money
Drive free traffic to your store and start making sales
Take your first step toward building a profitable online business today! No email require!
How to Build Long-Term Relationships With Trusted Suppliers
Once you find a good supplier, protect that relationship.
Start With Small Orders
Test quality, communication, and shipping speed before scaling.
Communicate Clearly
Ask about:
Inventory updates
Processing times
Policy changes
Use Written Agreements
Even simple contracts help:
Avoid misunderstandings
Set expectations
Protect both parties
Strong supplier relationships often lead to:
Better pricing
Faster shipping
Priority support
Common Scams to Watch Out For
Here are some of the most common supplier scams you’ll encounter:
Counterfeit products – Selling fake branded items like Nike or Apple at dirt-cheap prices. Not only is this a scam, but it can also get you sued.
Hidden fees – Some shady suppliers will suddenly add “shipping costs” or “customs fees” after you’ve paid.
Fake dropshipping directories – Websites that claim to list “exclusive suppliers” but only sell outdated or fake data.
Disappearing acts – The worst one: you pay, and the supplier completely vanishes.
Best Practices for New Entrepreneurs
If you’re new to eCommerce or dropshipping, follow these rules:
Always compare multiple suppliers
Never rush decisions
Avoid emotional purchases
Trust your instincts
Verify everything
Scammers thrive on desperation and impatience.
Conclusion
Getting scammed by a fake supplier is one of the most painful mistakes an entrepreneur can make. You lose money, time, and possibly even your reputation. But the good news is: with the right knowledge, you can avoid it.
Always look for red flags, verify every supplier, use safe payment methods, and start small before going all-in. Remember, in business, it’s better to be safe than sorry.
Learn from others’ mistakes (including mine) so you don’t repeat them. Protect your business, protect your money, and only partner with suppliers you can truly trust.
Your future success depends on it.
