Warranty – Does it Exist?

When importing your goods from overseas factories you must discuss and negotiate your exact terms of warranty with your supplier.  Because importers are at the top of the supply chain, any future product problems or warranty issues will filter back to you as the importer of the goods.  If you are on-selling these goods into the Australian market then your customers (whether they be Business-2-Business, or Business-2-Consumer) will most likely want warranty if they have obvious issues with your products.

You must be confident with your warranty terms and agreements with your factory.  When dealing with Asian factories, warranty terms between different suppliers vary greatly.  Some larger factories supply high quality products to the world and will have no problems giving you a set amount of time to cover the product or component warranties.  On the other hand, some suppliers will not agree to warrant their products for a set amount of time, and can sometimes be very vague when discussing warranty.  The keys to product warranty for your business:

A – Knowing what your factory will offer to you

B – Knowing the actual cost to your business if you were forced to replace products to your customers in Australia

If you aware of both of these key points, then you can confidently plan your business in Australia.

In most warranty cases that you face in Australia, it is easiest for you to replace or refund the customer for the products they purchased and keep a track of how often it occurs.  If you only have to replace very few items and the cost for you to replace the items is only relatively low, then it may not justify discussing with your factory overseas.  On the other hand if the problems occur more often, then you will have to discuss your previously agreed warranty terms with the factory.  Providing that you can send sufficient information and photos of the faulty products to the factory, then you can work through the warranty agreements.  The most common warranty agreements with most factories is that they will agree to replace the number of faulty goods at a discounted price (or even at their cost, depending on product).  It is important to know that factories will not transfer or refund any money back to your bank account.  They will fix any warranty issues with discounts/adjustments on future orders that you place with their factory.

Any warranty terms you discuss should be added to any Purchase Order and Proforma Invoices signed off with the supplier.




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