[YOUR COMPANY´S NAME]
Terms of Delivery
Prices:
Unless otherwise stated or agreed, all new price quotations and revised prices are valid for 12
months.
Price changes:
 For items that have been bought from Customers during the last 12 months, Supplier will
review Customers´ prices every year and supply new price lists on November 1st. The
new prices will be valid between January 1st and December 31st the following year. The
price list should include information about the main raw materials which the items are
made from, and the current raw material prices. Orders already confirmed by Supplier
will not be affected by such price changes.
 Notwithstanding the above, if extraordinary circumstances would occur that result in a
major change of the price for certain components such as for instance raw material, then
Supplier may/should change the prices for a certain order after Customer has placed such
order and before Supplier has confirmed the order, according to the following, according
to the following: If the prices of the price elements have increased with more than 10%
since last ordinary price offer, then Supplier has the right to increase the prices
correspondingly. If the prices of certain components have decreased with more than 10%
since last ordinary price offer, then Supplier has the obligation to decrease its prices
correspondingly. For purposes of determining the prices correctly in such cases, Supplier
agrees and undertakes towards Customer to submit in writing an updated cost calculation
for the manufacture of the products, indicating the prevailing prices of certain price
elements that may fluctuate. (Example to clarify: If the raw-material price has increased
with 12% and the raw-material part, = price element, is 20% of total price, the offered
price will increase by 2.4%. Same principle applies regarding decrease in raw material
prices.)
Currency exchange changes:
 Notwithstanding the above, if the exchange rate of the currency of the offer has changed
with more than 2% against the Chinese currency (RMB) since the offer, then Supplier
may/should change the prices for a certain order after Customer has placed such order
and before Supplier has confirmed the order, according to the following: If the Chinese
currency has been revaluated with more than 2% since last ordinary price offer, then
Supplier has the right to increase the prices correspondingly. If the Chinese currency has
been devaluated with more than 2% since last ordinary price offer, then Supplier has the
obligation to decrease its prices correspondingly. For purposes of determining the prices
correctly in such cases, Supplier agrees and undertakes towards Customer to submit in
writing the valid exchange rate at the time of the offer and at the time of the price change.
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[YOUR COMPANY´S NAME]
Sales Confirmations and deliveries:
 Customers are allowed to place orders up to six months prior to requested delivery from
Supplier.
 For accepted orders, the Supplier shall send Sales Confirmations within 5 working days
after receipt of order from customer.
 The customer is considered to have accepted the prices and terms of a Sales
Confirmation, if he has not raised any objections against it within 5 working days after
receipt of the Sales Confirmation.
 For products ordered by Customers in such way that Supplier can keep an ongoing
production all the time, the production time, unless otherwise agreed, should be no more
than 30 calendar days (not counting Chinese national holidays), and shipment from
Supplier should take place no longer than 40 days (not counting Chinese national
holidays) after the Supplier´s confirmation of the order. For products ordered by
Customers in such way that Supplier can not keep an ongoing production all the time, the
production time, unless otherwise agreed, should be no more than 40 calendar days (not
counting Chinese national holidays), and shipment from Supplier should take place no
longer than 50 days (not counting Chinese national holidays) after the Supplier´s
confirmation of the order. The Supplier agrees, at its best effort, always to strive towards
a shortening of the production time. Suggestions from the Supplier how to shorten the
production time is gratefully encouraged and will be evaluated.
 Unless otherwise agreed, the Supplier shall always deliver the same amount of items as
agreed in the Sales Contract. Customers will not have to pay for overproduction.
Minimum order quantity:
For order amount less than USD 1,000 (excluding tooling charges), a surcharge of USD 60 will
be added - unless the order can be shipped with another order to same customer and the
combined order value is more than USD 1,000.
Payment term:
For regular orders to be shipped within 40 days after Sales Confirmation (S/C), invoice for 50%
of order value should be issued by the Supplier directly after confirmation of S/C and remaining
50% of the order value should be invoiced within 10 days after shipment from supplier.
For items with expected delivery time later than 40 days after the Supplier´s confirmation of the
order, invoice for 30% of order value should be issued by the Supplier directly after confirmation
of S/C and remaining 70% of the order value should be invoiced within 10 days after shipment
from supplier.
Payment term of all invoices should be within 10 days after invoice date.
If the customer wishes other payment terms from the Supplier, he can obtain such according to
the following:
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100% payment against copy of B/L + Letter of Credit (L/C) issued by customer: 0% extra
charge on FOB prices.
100% payment 30 days against copy of B/L + Letter of Credit (L/C) issued by customer:
2% extra charge on FOB prices.
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[YOUR COMPANY´S NAME]
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100% payment 60 days against copy of B/L + L/C issued by customer: 4% extra charge
on FOB prices.
Delivery term:
Unless otherwise agreed between the Supplier and customer, delivery term should be FOB,
according to Incoterms 2000. Additional insurance, after goods have been loaded FOB, will be
on customer´s account.
Late payments:
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2% interest per month will be charged for payments not received within 10 days from last
payment date. Interest rate will be calculated from 10 days after payment last payment date.
If a customer repeatedly is late with payments, the Supplier may instruct its shipping agent
not to release the goods until full payment has been received. In such case, the customer
shall bear all extra costs incurred.
Delayed shipments, not caused by customer:
Delivery of repeat orders:
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Delivery from supplier can be up to 1 week delayed counting from confirmed shipment
date, without penalty.
Starting the second week of delay, a discount penalty will apply at 2.0 % discount
(calculated on the FOB value of the Sales Confirmation) per weekly delay.
After four weeks delayed shipment, the customer has the right to waive its right at 2% per
week penalty charge, and instead choose to demand that the Supplier, at no extra expense
for the customer, sends the goods by air freight according to the following: For each
weekly delay (after the four weeks delay from confirmed shipment date), customer has
the right to demand that 20% of the goods be sent by air freight (= five weeks delay
means 20% by air freight; six weeks delay means 40% by air freight, etc.).
Delivery of items that have not been sold to customer before:
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Delivery from supplier can be up to 2 weeks delayed counting from confirmed shipment
date, without penalty.
Starting the third week of delay, a discount penalty will apply at 2.0 % discount
(calculated on the FOB value of the Sales Confirmation) per weekly delay.
After five weeks delayed shipment, the customer has the right to waive its right at 2% per
week penalty charge, and instead choose to demand that the Supplier, at no extra expense
for the customer, sends the goods by air freight according to the following: For each
weekly delay (after the five weeks delay from confirmed shipment date), customer has
the right to demand that 20% of the goods be sent by air freight (= six weeks delay means
20% by air freight; seven weeks delay means 40% by air freight, etc.).
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[YOUR COMPANY´S NAME]
The Supplier must inform the customer about any kind of delivery delay at least one week before
confirmed shipment date. Failure to do so, will result in an additional surcharge of 1% weekly
penalty (= 3% instead of 2%).
If a customer delays his first payment of the order according to payment terms on invoice, then
the Supplier has the right to delay shipment accordingly.
Partial deliveries:
For partial deliveries requested by the customer, where sales amount of each shipment is less than
USD 1,000 (excluding tooling charges), a surcharge of USD 60 will be added.
Postponement of shipment:
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For postponed shipments, requested by the customer, of more than 4 weeks from agreed
delivery date, a surcharge of 2% per month will be added. Request for postponement of
shipment shall be made to the Supplier at least 2 weeks prior to delivery date according
to Sales Confirmation.
If a customer requests postponement of a delivery for which he has only paid 30% as first
payment of the order, then he should pay an additional 20% of the order value within 10
days after the requested postponement.
A customer is not allowed to postpone a shipment more than 3 months from confirmed
delivery date.
Order cancellations:
If a customer wants to cancel orders which have been confirmed by both the Supplier and the
customer, the customer should pay according to the following:
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When the customer informs the Supplier more than 30 days before confirmed shipment
date, the customer should pay 30% of the order value.
When the customer informs the Supplier between 15 and 30 days before confirmed
shipment date, the customer should pay 50% of the order value.
When the customer informs the Supplier between 0 and 14 days before confirmed
shipment date, the customer should pay 80% of the order value.
Tools, jigs and moulds:
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The Supplier certifies that all customers will be reimbursed for its payments of tools, jigs
and moulds if the Supplier does not succeed in producing samples that are equal in
quality as to the samples of these that have been supplied from the customers.
All tools, jigs and moulds, paid for by The Representative or by customers or potential
customers and other business references introduced/revealed by The Representative to
the Supplier, shall be regarded as the private property belonging to the company who
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paid the tools/jigs/moulds, and may under no circumstances be used for production to any
other customer.
Within the first year from the date when customer has approved of samples from the
Supplier, the customer will not be entitled to collect the tools, jigs or moulds and use for
production with another supplier. The Supplier also agrees, during this period of time, not
to increase its prices unless it can be proven by the Supplier that it must increase its
prices due to increase in certain price elements.
After the first year from the date when customer has approved of samples from the
Supplier, the customer will be entitled to collect the tools, jigs or moulds and use for
production with another supplier, if the customer pays an extra service fee to the Supplier
equalling 50% of the original cost for the tools/jigs/moulds.
Quality and claims:
The Supplier shall at its own initiative make sure it has all the information and data required to
carry out the orders. Before shipment, the Supplier undertakes to make sure that the product
quality of each order is checked and approved of according to each customer´s requirements and
instructions.
The Supplier agrees, at its best effort, always to strive towards an improvement of the Product
quality. Suggestions from the Supplier how to improve the Product quality is gratefully encouraged
and will be evaluated.
Items that have been delivered to the customers but do not fulfil the quality standards that the
Supplier and the customers have agreed on, may be rejected by the customers. Such items shall
be replaced by the Supplier at the Supplier´s own expense. Product quality claims should be
raised within 120 days from date of B/L.
The Supplier will not accept responsibility regarding claims against the customer by a third party
and associated costs incurred by as a result of the third party´s purchase and use of the products
supplied by the Supplier.
Claims should be handled in the following way:
 Customer sends specification to the Supplier (or its representative, e.g. The
Representative, who conveys the information to the Supplier) including information
about a) Clear description of the problem (including samples of bad items if possible) , b)
Customer´s order number and the Supplier´s Sales Confirmation number, c) Request for
compensation.
 After the Supplier´s approval of the claim, the Supplier shall replace the claimed items as
soon as possible and send them by boat freight.
 If customer and the Supplier instead agree on compensation in terms of money, then this
amount should be withdrawn from invoices for future shipments from the Supplier to
customer. If it has not been possible to withdraw the amount within 12 months (if e.g. the
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[YOUR COMPANY´S NAME]
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customer has not placed new orders), then the Supplier shall pay the amount directly to
the customer.
Other than above, the Supplier has no further obligations with regards to coverage of
associated costs incurred by as a result of the quality claim raised by the customer.
Secrecy and non-competition:
The Supplier agrees to take all precautionary measures in order to prevent that any of the
products or product drawings supplied by The Representative or by customers or potential
customers and other business references introduced/revealed by The Representative to the
Supplier and which may be considered as the customers´ own product designs are
copied/duplicated or sold in any manner to other companies than the original source.
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