Does China Have a Return Policy?

In most developed countries, returning a product purchased at a retail location is not a problem. In fact it’s so easy that people often will purchase a product when they’re not even sure if they will keep it. For example, when a customer purchases a product from Walmart, the world’s largest retailer, they are assured that Walmart will take almost anything back, for almost any reason. An excerpt from their return policy reads as follows:

To return a purchase to a store, take the following articles to Customer Service at your local Wal-Mart:

* The item you wish to return
* The invoice for that item
* All original packaging and accessories

For all payment methods except Bill Me Later®, an associate will issue an immediate credit to the original payment method or provide a store credit for the cost of the item and the sales tax, if applicable.

But what happens when Walmart (or your company!) receives defective or substandard goods from a factory in China? Does China have a return policy? The Silk Road International Blog has an interesting article titled Returning Products to a Factory in China where David provides insight into what the reality is on the ground and what your legitimate concerns should be when deciding to request a return of product.

In summary, David points out that if you’re receiving defective/ substandard products and you’re just finding out about it when it hits the dock at your landed destination, you failed to perform the necessary quality checkpoints that simply are required when working with Chinese factories.

So what’s the solution? DON’T EVER SHIP BEFORE YOU (YOU PERSONALLY OR SOMEONE OTHER THAN THE FACTORY) APPROVE IT. It doesn’t matter how “good” your relationship with the factory is. It doesn’t matter if you’ve shipped the same thing a dozen times before. It doesn’t matter how big your order is or how many other future orders rely on this shipment.

If you’ve got product in your home country (and you’ve already paid for it) it’s too late to be finding find problems.

However, accidents do happen, schedules are tight, small companies can be inexperienced, etc. In addition to the obvious issues involved with requesting a refund such as potentionally damaging your relationship with the factory, here are 2 points out of the 6 that we consider vital to consider:

2. You may not get the product back into the country-especially if it’s defective or already opened because of import restrictions. There are limits to what China (and all countries) will allow into their country. Rejected product and or second hand items are often not allowed into China. You need to confirm with a freight forwarder before you start negotiations with your supplier that this is really an option.

You may also find yourself with an IP (Intellectual Property) issue:

5. You will see the returned product again, somewhere. If the product is usable and if you can send it back into China and if you are getting a second order for free I can guarantee you that the factory will sell the stuff to cover their costs. They don’t care about your reputation in the industry-they are concerned about their bottom line, first and foremost. Be prepared for customer service calls from Karachi.

Check out the entire article and as always, do your due diligence to prevent problems from happening once it’s too late!

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Comments

5 Responses to “Does China Have a Return Policy?”

China Sourcing on January 25th, 2008 3:23 pm

First let me say you have a great site here and I will be passing the URL along to my associates. In regards to return policy with Chinese made goods, it all depends upon who you are working with. Our parent company had a shipment of items that did not meet the buyer’s exact specifications. Our parent knew this to be a long term customer so they bit the cost and returned it to the Chinese factory where the minor but labor intensive modifications were made and reshipped the order to the customer who was very happy and continues to do business with us to this day.
Unloading Containers - Be Prepared When the Goods Land! : SourceJuice on January 27th, 2008 1:35 am

[…] the broken items that did not make the trip. Check out one of SourceJuice’s articles, “Does China Have a Return Policy?” for additional strategies and information. Your cargo insurance will not cover damages […]
China Law Blog on March 25th, 2008 1:47 pm

Returning Substandard Products To Your China Factory: In Another Lifetime, Brother….

David Dayton at Silk Road International Blog did a post on a topic near and dear to my heart, “Returning Products to a Factory in China” (h/t to Source Juice). I deal with this issue quite often when Western companies seek my law firm’s assistance i…
Allroads on March 25th, 2008 10:11 pm

If there is one thing I have learned is that if there is anything wrong in China, it is easier to fix the problem in China.

for one of my largest clients we have less than a half percent failure rate at their door over a long time line. We have of course had higher failure rates in country, but because we inspect goods as commodities, as sub assembledd parts, and as finished goods we have reduce the failures at the end of the line to next to nothing.

and when we have had failures, and those failures occurred in country, getting the supplier to resolve the problem is not an issue from a process perspective.

I am always amazed by how many companies and individuals believe that they can just expect product to show up at their door in perfect order without having in place a quality assurance system.

Transportation costs aside, how does anyone think that they would be able to manage this? the supplier is in the control seat. they have the money in their pockets, the product is in your warehouse, and they know that you have no options but to either pay for another load from them…. or find another supplier.

Lesson here is simple. Inspect before you pay. You a third party if you have to, but internal eyes are best. and make the returns before the power position has shifted, because if the supplier is still out out pocket for the costs of the order they are much more likely to work with you to resolve.

Oh - I think it goes without saying that the friend needs to find a new supplier anyway. The quality has been slipping over time ,and they should have pulled the trigger a long time ago.

China is not a McDonald’s. You cannot just place your order and drive around. you need to see what is going on in the kitchen.

r
http://www.allroadsleadtochina.com
Nick Liu on August 25th, 2008 9:11 pm

MonteroSourcing uses a proprietary global sourcing platform to cut customers’ production costs by 20-50% without dealing with the hurdles of sourcing in China.