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Sourcing company sent unsatisfactory goods

Discussion in 'Legal, Insurance, Employment and Health & Safety' started by GStarz, Jul 4, 2019.

  1. GStarz


    Jul 4, 2019
    I run an online retail company and in April 2018 I used a UK based sourcing company to purchase some goods. The company in question used a Chinese factory who they claimed to have vetted to supply the goods. We negotiated the specifications and prices with the UK company but then when we paid the deposit we found out that we had to pay the factory in China directly instead of the UK company. We went ahead anyway as the UK sourcing company was a well respected company who had plenty of good references as did the factory in China.

    Unfortunately we have had major issues with the goods. Firstly the goods were nearly three months late, and then when they arrived in November 2018 we realised that there was a serious quality issue affecting all the products in the shipment.

    Upon notifying the sourcing company about the issue they spent about four weeks telling us that they were not prepared to resolve the situation. Then they reluctantly agreed to get the Chinese factory to remake the goods and send them to us at their own cost. They told us that we would receive the reworked goods in March 2019, but it is now July and we still have not received them.

    Because we have not been able to sell this product for the last 12 months we have suffered a massive drop in revenue and also incurred huge storage costs whilst waiting for the poor quality goods to be replaced.

    So far the sourcing company have refused to offer us any form of financial recourse for the losses we have incurred citing that they have no responsibility as we paid the Chinese supplier and not them. There was also no contract between ourselves and the sourcing company which I now realise was a big mistake. However we have many emails between ourselves and the sourcing company and in my opinion the contract was formed with the sourcing company in the UK, it was only when we paid the deposit we realised that we had to pay the Chinese factory directly.

    To sum up, we paid a sourcing company in April 2018 for some goods that we expected to be delivered in August 2018. They were delivered in November 2018 but of unacceptable quality, they reluctantly agreed to remake them to be delivered again in March 2019 but it is now July 2019 and we are still waiting for the goods to be delivered.

    Do I have a leg to stand on here with regards to receiving compensation from this company?

  2. Import Expert

    Import Expert

    Oct 6, 2011
    I assume you paid the sourcing company something - If so, they will have T&C's in place which is essentially your 'contract'. Have a look at these, although I would expect as with most T&C's that they will have covered themselves.

    Seems a bit strange for them to ask you to pay the factory direct, but others may be able to advise on this.

    May I ask which company you used, and what are they telling you is causing the delay for the replacement goods?
  3. Erik


    Sep 26, 2012

    Keep the conversation logs with the sourcing company. It seems that regardless you paid directly to the company, they should still hold something out of it.

    I think the best route to take into this is to consult about legal actions you could do to the sourcing company. I think something that would force their hand to push the Chinese factory to follow through with the stocks I suppose?
  4. Saurabh


    Jul 15, 2019
    What I understand from above is that UK based company is just a agent of China manufacturer. Now what possibly happen is when you pay to China Co. he paid commission to UK company & deliver goods to you. This happens every day here in China( even in community social media groups i found that customer himself load goods in container & locked but later supplier opened container & change goods). As you pay directly to China supplier, UK company do not own any liability & possible commission they got from China is from back channel. I suggest you if you have any contract with UK company than take legal action ASAP or just forget what happened & focus more on Business. One thing i can do is circulate China Co. info in we chat groups here in China & check if anyone know this co. personally.
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