- Published on Wednesday, 28 November 2012 12:07
When I ask to pay by Pay-Pal the supplier is not interested? Should I lose confidence in working with them?
Thanks for your question. The answer really depends on volume. Small traders/ exporters who sell at very small volume (units or small cartons) generally work w Pay Pal if they have clients overseas. Factories/ medium-large suppliers almost never use PayPal as a transaction tool due to the service fees and complicated set up. Let me know the product you are buying, supplier details (if not too sensitive), and value of this order, and I’ll be happy to review and offer some suggestions.
The value is $200. The problem that we are faced with in Australia is if you TT the money and the product is faulty, the buy side does not have any protection. Pay-Pal will protect the buyer. We prefer to buy a sample using PayPal, test it, then buy 10 more pieces, then 100 pieces and so on.
Thanks for your feedback. I think at those volumes you will have a hard time convincing a supplier who is used to larger orders to set up pay pal just for you. But I have two suggestions.
1. If the supplier does want your business, then do one of the following:
a) Ask to pay after the samples have arrived
b) Pay ½ up front and the rest after it has arrived
c) Pay 100% upfront, but agree on a reduced unit price when future orders are placed in an agreed period of time.
2. As it is probably too expensive to fly over and check a few units yourself, consider using a 3rd party Quality Control company (3PQC). They charge a few 100 USD to check out a supplier or inspect sample before they are sent. Granted your order size is only a few 100 USD, but if you get scammed and end up paying 2 or 3 bad exporters before you find a legit supplier with legit quality, then paying 3PQC upfront will save you money.
Before you engage the supplier, simply ask if they will allow an inspection. If they say “no”, then you should run away. Asking a key question doesn’t cost anything. Ask for references too!
Here is a video and an article about using 3PQC:
Video 4: Project Management and Quality Control
Protecting yourself through better Quality Control
Here are some articles about how the challenges of being a small buyer and trying to go factory direct:
How to place an order with a supplier in China while living somewhere else
Too small to go factory direct?
As I mentioned scams above, here is an article explaining who the scam artists target (unfortunately, you fit the target) and how they go about their scam.
Genuine products from China?
Question answered by Mike Bellamy, an Advisory Board Member & Featured Blogger at the not-for-profit China Sourcing Information Center. Mike is also the author of "The Essential Reference Guide to China Sourcing" and founder of PassageMaker Sourcing Solutions.