Does My Supplier Company Chop The Documents When Using A Sourcing Agent?
Posted by Live Now Education G Support Team on 02 May 2019 12:08 PM
Do I need to have my supplier company chop documents when using a sourcing agent?
This is actually a very good question and the short answer is yes you should definitely have your agent and supplier both sign the documents.
Whilst it's quite common for the sourcing agent to act on the suppliers behalf and try to avoid you knowing who the supplier is, this isn't ideal for a few reasons.
Firstly you have no documents company chopped from the supplier confirming they won't use your brand, or reproduce your products for other people. This is where the NDA Agreement (off the shelf products) or NNN Agreement (modified products) should be in place for the sourcing agent and supplier.
Next think about what happens in the unlikely event something goes wrong with your products. From our experience you may find it difficult for the supplier to take accountability to repair / replace faulty units if they haven't company chopped the Sample Making Agreement (samples), Purchase Order Agreement (main orders) and Quality Control Checklist (all orders).
Lastly there's also a slight chance your sourcing agent retires or stops trading in the years to come and you won't know who your supplier is, which can bring your entire business to a halt.
Your sourcing agent will probably not willing tell you who the supplier is or have them sign your documents because they will be concerned you'll 'bypass' them and go directly to the supplier for your orders and it's up to you if you want to take that risk, however if we were in your shoes we wouldn't give money to a supplier without knowing who they are.
Therefore you may need to find a solution to keep everyone happy, such as signing an agreement with your sourcing agent that you won't order directly from the supplier ongoing, or for XX amount of months, or XX amount of orders etc to ensure that's not your intentions.
Whilst using a sourcing agent to take care of everything for you including the documents can be quicker and easier, it doesn't give you as much protection long term.