I Am buying from a china manufacturer for the first time. 30% deposit is paid and goods finish manufacture in about a week. I pay the other 70% when the copy of B of Lading is supplied.

The manufacturer has now come to me saying that the US$/ RMB exchange rate has changed so much between initial quote and now that he will lose 5%. While not disputing this, he is asking if I can help out, ie basically agree to an increase in price. I find this highly unusual, basically a company needs to cater for possible exchange rate changes when they quote and take that risk is my view. What do others out their feel on this matter. Looking for views from buyers and also suppliers/manufacturers

Replying to [donalstuart]:You must have been cheated. An Italian entered into a contract with a seller. Payment term T/T 30% deposit and balance by document. He paid the deposit, but the seller did not shipped any goods and urged him to pay the balance. He wanted to retain a lawyer. I am his lawyer in Shenzhen. I am not sure if I can collect his money. But he has to pay for the attorney's fee and court cost first.

Quoting from [donalstuart]:


I Am buying from a china manufacturer for the first time. 30% deposit is paid and goods finish manufacture in about a week. I pay the other 70% when the copy of B of Lading is supplied.


The manufacturer has now come to me saying that the US$/ RMB exchange rate has changed so much between initial quote and now that he will lose 5%. While not disputing this, he is asking if I can help out, ie basically agree to an increase in price. I find this highly unusual, basically a company needs to cater for possible exchange rate changes when they quote and take that risk is my view. What do others out their feel on this matter. Looking for views from buyers and also suppliers/manufacturers

Actually that doesn't make any sense unless the quote was done in the first week of December 2007.

1. first week of January 3.7% to present Forex
2. first week of  Febuary 2.2% to present Forex
3. first week of March 1.1% to present Forex

Are you getting a great quality product?  If so it might be a good idea to split the difference based on when you sent the money based on the above percentages or you may have lost a supplier and or the next quote for the same product could be taking into the fact that they may add a 10% cushion to the price.  It really depends on how much business you want to continue to do with this company, if any.

Ranger

 

Replying to [donalstuart]:For a normal business ethics, once both the Buyer and Seller agree with the quotation, it stays that way regardless of currency fluctuation.

Unless your agreement stated that the Buyer would be responsible for the new price. Even if that is so, the Seller has to prove its claim. Otherwise, the Seller can try his luck by asking you for the extra money, but you are in no obligation to agree.

Seller normally states on the agreement that he would give 30 days advance written notice should there by any changes in price. Then again, the agreement is based on both sides' wellingness.

To prevent further US currency fluatuation, and if the Seller has confident in his own country's currency, he could provide quotation in own country currency instead of USD.

If you find this is a good supplier and you want to continue further cooperatiton with them, you can pay to this lost to help them, if not, it is not necessory to pay for this, unless both party made this point  on the contract about the currency rate. 

Quoting from [Elecpack]:




If you find this is a good supplier and you want to continue further cooperatiton with them, you can pay to this lost to help them, if not, it is not necessory to pay for this, unless both party made this point  on the contract about the currency rate. 

Thank you for bringing this problem up.I am facing it right now.I paid 50% advance for goods only to be told after 15days that "price went up".

I wrote to send my money back.NO WAY!!!!. I pleaded to "allow old price": NO WAY.

What to do????? I ended up with a little reduction on new price and less goods in quantity because of this.

At the end,I am the loser. Is this due to weak dollar or what???????

Quoting from [tilapia]:

Quoting from [Elecpack]:





If you find this is a good supplier and you want to continue further cooperatiton with them, you can pay to this lost to help them, if not, it is not necessory to pay for this, unless both party made this point on the contract about the currency rate.

Thank you for bringing this problem up.I am facing it right now.I paid 50% advance for goods only to be told after 15days that "price went up".

I wrote to send my money back.NO WAY!!!!. I pleaded to "allow old price": NO WAY.

What to do????? I ended up with a little reduction on new price and less goods in quantity because of this.

At the end,I am the loser. Is this due to weak dollar or what???????

It seems to be a mixture of rapidly increasing product prices (steel is one) and a rapidly  strenthening RMB currency, so it means when they get payment that the US$ you have ageed on buy less RMB, so a price reduction for them. If they are an Alibaba seller, report them here. http://www.alibaba.com/trade/help/helpcenter.

Quoting from [donalstuart]:

Quoting from [tilapia]:

Quoting from [Elecpack]:






If you find this is a good supplier and you want to continue further cooperatiton with them, you can pay to this lost to help them, if not, it is not necessory to pay for this, unless both party made this point on the contract about the currency rate.

Thank you for bringing this problem up.I am facing it right now.I paid 50% advance for goods only to be told after 15days that "price went up".

I wrote to send my money back.NO WAY!!!!. I pleaded to "allow old price": NO WAY.

What to do????? I ended up with a little reduction on new price and less goods in quantity because of this.

At the end,I am the loser. Is this due to weak dollar or what???????

 

It seems to be a mixture of rapidly increasing product prices (steel is one) and a rapidly strenthening RMB currency, so it means when they get payment that the US$ you have ageed on buy less RMB, so a price reduction for them. If they are an Alibaba seller, report them here. http://www.alibaba.com/trade/help/helpcenter.

This makes me scared to start. What to do ??? How else could we get products from China or elsewhere ???


How do we find genuine honest business ??? I mean even they are good now, could we still be assured for the future ???


I mean why can't everybody be just fair ... everybody is making a living here right ?? why don't we all do the right thing so that we can execute our business as we plan ???

This is a common practice in China and should not be viewed as "cheating". Usually Chinese suppliers quote the rock bottom prices due to the competition from their next door neighbors. However, due to the steep rise in RMB, they start loosing part of their profit in case of the deal being prolonged. Definitely, it is not a "good business practice". They should consider all the risks and the potential increases in the currencies when they quote. But, they can't, because of the competition and they have to quote lower than their next door neighbors. The only visible solution is to hold on to "L/C" payment. This is what we do. Even if the total amount is USD 1000, we insist that the payment term be L/C at sight. Most of the suppliers agree after some initial objections. It appears to me, for you, this time the only way is to pay the extra money demanded but after a long bargaining.(whatever you save is good). If you want to wait the outcome of the law suit for months be my guest. But, next time find a supplier who accepts L/C. I hope this helps.



Quoting from [donalstuart]:


I Am buying from a china manufacturer for the first time. 30% deposit is paid and goods finish manufacture in about a week. I pay the other 70% when the copy of B of Lading is supplied.


The manufacturer has now come to me saying that the US$/ RMB exchange rate has changed so much between initial quote and now that he will lose 5%. While not disputing this, he is asking if I can help out, ie basically agree to an increase in price. I find this highly unusual, basically a company needs to cater for possible exchange rate changes when they quote and take that risk is my view. What do others out their feel on this matter. Looking for views from buyers and also suppliers/manufacturers

Quoting from [donalstuart]:


I Am buying from a china manufacturer for the first time. 30% deposit is paid and goods finish manufacture in about a week. I pay the other 70% when the copy of B of Lading is supplied.


The manufacturer has now come to me saying that the US$/ RMB exchange rate has changed so much between initial quote and now that he will lose 5%. While not disputing this, he is asking if I can help out, ie basically agree to an increase in price. I find this highly unusual, basically a company needs to cater for possible exchange rate changes when they quote and take that risk is my view. What do others out their feel on this matter. Looking for views from buyers and also suppliers/manufacturers

Once the buyer and seller agree to a price,its ethical to stick on to it.The supplier is not going to pay the buyer if he gets a higher rate for his currency and like wise the supplier should not ask for a upcharge if the currency falls.

Quoting from [donalstuart]:

we are the gold supplier in alibaba. And we have the same proplem with the currency rate . The currency rate RMB & USD is really fluctuate very much. And we can not guess and control that. I try to said that to my client ,I hope he can understand us. But he said NO. That is make us lose a lot. ..... And It is possible i must to responsible for lose part.

And at last ,I did not let my client to accept the increase part. But he did not send the balance to us. Our product is finished. They can delivery . We are worry very much. Bcos the USD RATE is be down again. So ......Suppriler & buyer should be understand each other.

It is my truth heart .I hope my client understand us. .....worry worry......