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Problems with SD card delivery. Scam or legitimate excuse?

Recently I have a bad experience with a supplier. I paid for the goods (micro SD, SD card) but in the end encounter they got my shipment mix up and I received wrong goods. I do not know if this is a true case for wrong shipment or is a scam. I reported this problem immediately to the sales person who handle me and she has informed her manager about it. I am very frustrated when these things happen, the manager didn’t even bother to call me up. I was informed the manager did meet up with the freight company (Chinapost) for this issue. I really do not understand why it took so long to track the wrong shipping which I believe they should have a record. Later the case was passed to a Post Sales personal that is helping me coordinate with the Chinapost to trace my wrong shipping. For the past 2 weeks, it was good that the post-sales personal still responsive to my email for status update but update is always still tracking. Soon after 1 month past, they start to ignore my email to provide the update despite constant follow up. I wanted to ask them to re-produce a new batch of goods for me while they continue to trace the wrong shipping If they cannot, then they should refund to me. They seem very reluctance and now did not even response to me. I like to seek your advice how to settle this problem. I am still hoping to maintain business with them and get the goods if possible. It has been nearly 2 months since I last made my payment of 3000 over dollar.

 

China’s SD card industry in particular is ripe w scams. I wrote the following whitepaper which offers some strategies; you will certainly find it of interest:  May 2013 CSIC White Paper. Behind the scenes: buying SD cards & flash/ thumb drives direct from China

Because SD industry is so full of scam artists, you would be wise to assume the worst.  For example, they may be trying to get you to pay for a new order before the first order problems are sorted.  What kind of due diligence did you perform to confirm the seller is legit business selling legit quality products?   Did you conduct some QC before the goods were shipped? For your general reference, here are some blog posts about verifying suppliers and managing QC.

Essential sourcing skills: Supplier Verification

Video 1: Finding Suppliers
Video 2: Evaluating Suppliers
Video 4: Project Management and Quality Control

I highly suggest that you structure the payments so the upfront deposit is as small as you can negotiate and the remaining payments are not made until you or a 3rd party confirm the quality and order counter before the goods are released.

One part of the story doesn’t quite make sense. You say you received the wrong goods and seller implies the logistics company messed it up.  If the seller admits the wrong stuff was delivered, it feels pretty clear to me that they are responsible to fix the problem. I’m unclear why you would have to take point in sorting things out with the logistics company.  To help get to the bottom of this, I need to see the Purchase Order and agreed Incoterms.

If your incoterms were something like ExW China, then these logistics headaches would be your responsibility to sort out. If the terms were DDP then the seller is clearly on the hook for delivery.

If the terms were FOB or CIF, then we’d need to take a closer look at where in the supply chain things have gotten off track to determine who is responsible.

If you don’t have a signed agreement stating the Incoterms…then you may have a difficult time getting your money back unless the seller is a legit business and you have future orders to leverage.

BTW, you said you received the wrong goods. What showed up? If it was something radically different from what you ordered, then your case could be strong if the seller shipped something that was not fit for function.

For the sake of exploring the options, let’s assume that the seller is not a scam artist and let’s assume that you wish to do business with them on a future order.  3000 USD is a lot of money so it’s reasonable that you are upset the seller is ignoring you.  If I was you, I would send them a diplomatic demand letter in Chinese from a Chinese law firm to let the seller know you are not forgetting about the 3000 USD and that they are responsible to fix things under Chinese law. But the demand letter needs some “sugar” too. Explain that if the seller sorts the problem out, you have future orders for them.  I like to call this strategy the fist in the velvet glove.  I can make some introductions to lawyers I have used in China if you like.

Here are some related resources for your reference:

Video 8: Avoiding Scams
Video 9: Returning Defective Products
Video 10: Resolving a Dispute

Let me know how things work out for you.

Question answered by Mike Bellamy.

Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center (www.ChinaSourcingInfo.org). Author of “The Essential Reference Guide to China Sourcing” and founder of PassageMaker Sourcing Solutions.



Mike Bellamy

Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center (www.ChinaSourcingInfo.org). Author of “The Essential Reference Guide to China Sourcing” and founder of PassageMaker Sourcing Solutions. Mike is co-founder of CSA, the China Sourcing Academy.


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