What If the Customer Suddenly Does Not Want the Goods? Leave a comment

Case

Our company has a long-term cooperative customer from a well-known global company. Last year he ordered a lot of equipment parts from us for a total of 80,000 US dollars. But the production cycle of the goods was long. After we finished producing the product, we informed the customer to accept it. Unexpectedly, he told us that due to the adjustment of their internal production line, the production line would be shut down next month. So, This batch of spare parts was not needed, and there was no need to ship.

At the same time, he hopes that we can bear the expenses of the previous investment for our long-term cooperative relationship and do not ask for the payment. This news is beyond expectation. Although the goods are not shipped and the ownership is still in our company, the goods are customized for him and cannot be resold to others. If he does not use it, it can only be scrapped, which will cause us a big loss. How should we discuss with our customers and let them bear the expenses they should bear?

Analysis

If a customer is from a small company or a credit-poor company, this is a troublesome thing, because you have not received the advance payment. Even if you try to negotiate with the customer, but he ignores, you can do nothing.

If it is a large company with good credit, the situation will be better. They won’t go too far with a lot of things. And they have worked with you for a long time. There should be someone who can communicate. If they cause losses to suppliers for their own reasons, they should also have compensation plans. In other words, the supplier has the right to get compensation through their procedures. Therefore, you must work hard to communicate with your customers, strive for your rights, and minimize the loss.

Suggestion

I went through a similar thing in May this year. The customer changed the design, and the original design was invalid. So, the goods we had already prepared could not be shipped. After the negotiation, the client finally agreed to compensate us for the loss. We deducted the original price from freight, insurance, and some miscellaneous expenses, and turned it into the price of FOB Shanghai. And they agreed to pay. At last, we modified the contract, and I gave them an invoice. Now I have received a payment.

Perhaps the customer is from a big company, and he is tough. But you have a foundation for cooperation with him, as well as years of communication. You can also make some concessions, such as the original price minus some miscellaneous fees, etc. You can also deduct the value of the scrap, or even deduct some your reasonable profits. But for the cost and expense that you have invested, the customer should pay.

It is, of course, the best for the customer to let the supplier bear the loss. But you can reject their unreasonable demands. Any company must be responsible for its default. Therefore, you can ask the customer for compensation.

If you do business, do not give up easily, especially the benefits you deserve.

 

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