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Supplier sends an awful batch - what can be expected?

Discussion in 'Product Creation, Inventing, Importing, Sourcing' started by LPPC, Jan 10, 2019.

  1. LPPC
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    LPPC Bronze Contributor

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    Hello all,

    Christmas has been a very busy month and this has caused me to rush things and not think clearly because of the mental exhaustion. Warning to all the people who import: please order 1 sample first when dealing with a new product/supplier and always write a PO (contract) for your order because according to my information you have no trade assurance rights on Alibaba if you don't have a contract (if trade assurance would be of any use or worth)!

    I am selling this rechargeable night lamp from manufacturer/supplier A. Another supplier, B, offered me the same night lamp but for a cheaper price and much more beautiful appearance. I had no inventory left at this time and I had to choose to either order again with supplier A and order 1 piece sample from supplier B to test, or just order the small inventory of 40 pieces from supplier B immediatly without having seen any samples (but pictures and video were sent via email). Supplier B buys the product from the manufacturer and sells it to me.

    I stupidly chose the latter option and I got a batch with a battery that lasts only 3 hours maximum, instead of the 12 hours minimum that was clearly promised. Hell, I even paid more to have the battery upgraded, and this is probably the cause of the defect in battery because they had to change the motherboard for me. Why they didn't test it before shipping, I don't know.

    So now I have inventory with a battery life that is way too poor for this product and way worse than what the competition offers. Basically if they refund me the price of the inventory (377 USD) and also refund me the shipping cost (400 USD), then I can maybe sell this product for a low enough price to justify the poor battery. I would then also make some profit with this batch for it to cover the profit I will be missing because of this faulty order and the delay it has caused.

    Would it be fair and a smart move (business wise and to keep the relationship with the supplier intact) to insist on a refund for both the product cost and shipping cost? This problem would have been totally avoidable had they simple tested the product before shipment. It was clear they hadn't done their due diligence, because 19 of the products came totally empty in battery, meaning you had to charge it first to see whether it worked. And also some damaged packackings, but nothing major.

    I proposed that they could refund me this product cost and shipping cost in amount of night lamps. So basically if the total refundable cost is 777 USD and a night lamp costs 7.77, then they can give me 100 night lamps and I will pay for the shipping. So basically I am giving them another chance, but I will do an inspection of the new batch before paying them. The supplier said that she has to negotiate with the manufacturer and they will let me know. For now, they have already promised to replace the night lamps, but I have to pay the shipping.

    Looking forward to your insights and opinions!
     
    G-Man likes this.
  2. LPPC
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    LPPC Bronze Contributor

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    I just wanted to post an update, maybe it would be helpful to someone.

    The supplier decided to give me double the shipment amount as a refund. This means that the bad batch was 40 pieces, and now I will get another 80 pieces ''without paying''. This will cover my losses and probably also the potential profit i could have made.

    I have decided to order more from this manufacturer, although their first shipment was very sloppy. They provide 40 pieces of this 80 piece refund and the supplier provides the other 40. The reason is that they have given me the best offer out of 30+ suppliers I have contacted. Their product looks better and is cheaper than all the others and on top of that they have doubled the battery capacity without charging me much extra. If this next batch will be good, then it would be a good long term relationship.

    The first batch's motherboard was customized for me because of the battery increase. This also caused the defect in the first batch. The supplier said that the reason that they delivered a bad batch this time (that could have been avoided had they tested it throughly before shipment) is because they just moved to a new location and they are very busy. It is not a good excuse in my opinion, but it explains a lot.

    I will ofcourse do an inspection this time before shipping. And they also agreed that I will pay only after inspection has finished and the results are good.

    Maybe I am crazy to go with them again, but it could also be the right decision this time.

    This supplier (not manufacturer) has proved itself by being fair and refunding me. It makes me realise how important good relationships with suppliers are.
     
    DeepScripted, G-Man and Walter Hay like this.
  3. Walter Hay
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    Walter Hay Legendary Contributor Speedway Pass LEGENDARY CONTRIBUTOR

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    @LPPC, it's good to see that you have achieved a good outcome.

    No doubt the supplier has appreciated the polite way you dealt with the issue, and he really wants your business.

    Walter
     
    LPPC likes this.
  4. LPPC
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    LPPC Bronze Contributor

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    Thank you Walter! It was not an easy situation to be honest, but it pays to stay patient and think win-win and long term.
     
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  5. G-Man
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    G-Man Legendary Contributor Read Millionaire Fastlane I've Read UNSCRIPTED FASTLANE INSIDER Speedway Pass LEGENDARY CONTRIBUTOR

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    Way to keep your head, man. I remember asking my first boss in import export why he always took extra time to write a bunch of extra details for every line item of a PO, even with people we've bought from before. Experience has taught me why.

    When I send a PO, I always put whatever specific part number, and then in the description I put the detailed specs. If they gave me any kind of marketing materials, I then add "per attached blah blah blah", and attach to the email.

    It helps if there's a dispute, but also, and possibly more importantly, it makes sure you both have the same understanding of what's being purchased. I think most of my big FUBARs with suppliers haven't been due to any kind of malice or shadiness, but due to lack of absolute clarity.
     
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  6. Walter Hay
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    Walter Hay Legendary Contributor Speedway Pass LEGENDARY CONTRIBUTOR

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    LPPC and DeepScripted like this.
  7. LPPC
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    LPPC Bronze Contributor

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    That is a very good reason to write a PO too, indeed! Basically there is no reason not to do it. It would be stupid not to.
     
    G-Man and Walter Hay like this.

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