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Chinese Supplier got my Deposit, now Ignores me. What to do?

Supplier didn’t ship the order and kept our deposit. What to do?

Rajvansh in Dubai asks:

We have placed an order to a Chinese supplier for Paper Bags. The supplier is located near Qingdao.

We have made the advance payment to them as per the agreed terms. We even paid the balance for the first shipment they sent us. But, they had forged the documents and shipped less quantity.

To explain in brief – we placed an order worth about USD34,000. We paid the 20% advance of around USD6,800.

Then when they made the first shipment, we paid them around USD16,000. (But, they had shipped much less goods and we shouldn’t have paid this amount). They have in total USD22,000 from us and now they are demanding us to pay the balance USD12,000 to finish the production.

I visited their factory in first week of April 2015 to check the goods, as they had promised that they will finish the production of goods by March 30. But, they had not finished the goods and demand us to pay the balance.

What’s the guarantee that we will get our goods if we pay the balance. We don’t trust the supplier and would like to recover our money.


I paid for it. But they didn't ship it!  Guess what..your order is not on this boat...

“I paid for it. But they didn’t ship it!” Guess what..your order is not on this boat…

Thanks for contacting me. I have a couple of options for you.

If you wish to get the order shipped with this supplier, but reduce your risk, you could consider linking the supplier’s performance to you payment. For example, pay the supplier AFTER the goods have been inspected (by a 3rd party) but BEFORE the goods ship out of China.  This inspection could take place at the factory if a random inspection is sufficient, or 100% inspection could take place at a 3rd party (like my warehouse in China for example) if you wanted a very close inspection.  It would also be wise if you had a team representing you on the ground in China to help mediate and explain to the Chinese supplier how the above solutions benefits both parties.

If you have already given up on the supplier due to their poor performance, then here are two ideas:

List them at and expose them to the world and help other buyers avoid this bad supplier.

Consider issuing a demand letter from a Chinese lawyer to show them you are series about getting your money back as they messed up the order and caused you substantial financial loss.  I’m happy to recommend the lawyers at as they did a good job for me and I joined their board of directors.


Glad to help.

Question answered by Mike Bellamy

Founder of the PassageMaker Group of companies & business lecturer at the China Sourcing Academy

Mike Bellamy

Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center ( 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.

2 thoughts on “Chinese Supplier got my Deposit, now Ignores me. What to do?

  1. Deepak pawar

    I have visited China in August and I have meet 1 vendor to make watch in my brand name then came back to India and after 2 month I have deposited payment of 15000 rmb for stock of 60000 rmb advance payment done 15000 rmb so now the party is switch off his mobile so I could not connect him. Actually 1 party introduce us to that vendor v called to this vendor that your friend is done cheated us so please help me v requested but that vendor is not responding good to us so please help me out from this solution thank you waiting for your reply

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