Quality control provisions are crucial for Chinese supplier contracts for fulfillment-by-Amazon sellers. When using a Chinese company as a supply vendor for FBA, the obvious problem for Amazon sellers is that the manufacturer is overseas, and the products are being shipped around the globe. This means that it is very difficult to visit the factory to ensure that you are getting what you ordered. Further, there is a large gap of time between manufacture and receipt/inspection.
So, as an Amazon Seller, you might think “all is well” with your order of 10,000 units that should be arriving in time for the Holiday Season. However, upon arrival and inspection, the goods are not what you ordered, flawed or non-conforming in some important way.
For these reasons, when drawing up a vendor/manufacture contract, the most crucial provisions deal variously with quality control. The essential ideas can be summarized as follows:
- Stating clear, detailed, and precise product characteristics — these might include specification of materials (such as glass for eyeglasses, as opposed to plastic), design characteristics, composition (such as exactly four metal screws made of brass), etc.
- Stating clear and precise quality measurements and what buyer would consider an acceptable tolerance deviation (if any) — such as the product must conform in all respects to a prototype or the sample product provided by the supplier
- Making it clear — this is important — that “close enough” or “nearly the same” will not be considered “conforming” goods
- Providing that in-person, in-factory quality control (“QC”) audits by the purchaser or the purchaser’s agent are permitted — you may never want to conduct an in-person QC audit in China, but good quality manufacturers will not balk at such a provision
- Ensuring that any acceptance of non-conforming goods — even repeated acceptances — will not be deemed a QC waiver for future shipments — this is to protect an Amazon seller from what is often called “quality fade”
- Detailing remedies for non-conforming goods — such as return shipment and replacement (at supplier’s cost), or refund, or price credit, etc.
- Mandating expedited processing of replacement goods — this is crucial since Amazon has very strict time deadlines for delivery to Amazon customers
- And more
Two other crucial issues must be detailed in the supplier contract: time for delivery and shipping/delivery location. Given the importance that Amazon places on quick and timely shipments/fulfillments to Amazon customers, Chinese suppliers must understand that “time is of the essence” in these types of contracts. Thus, provisions must be included that plainly state the date on which the products must be delivered for shipment or received by the buyer. The latter type of provision places an obligation on the supplier to find a faster shipping method if the manufacture is delayed.
The ultimate delivery location is also important and should not be left to the supplier to determine. The options are delivery to an Amazon fulfillment location, to a middleman, or directly to the buyer’s location.
Vendor and supplier contracts can be complex and confusing, and you will benefit from experienced legal assistance when drafting or reviewing such contracts.
Contact the Chinese Supplier Contract Attorneys at Revision Legal For more information, contact the experienced Chinese supplier contract Lawyers at Revision Legal. You can contact us through the form on this page or call (855) 473-8474.