When to Pay the Final Balance to a Chinese Supplier

Common 30/70 payment structure

A 30% deposit and 70% balance is commonly discussed for production orders, but the percentages and timing vary. The commercial meaning depends on what triggers the balance: production completion, passed inspection, shipment booking, document presentation or another agreed milestone.

Write the trigger in the PI or contract. The words 30/70 alone do not tell the buyer what evidence must exist before the 70% is due.

Payment terms vary by supplier and product

Stock goods, custom packaging, molds, raw materials and machinery can require different cash-flow arrangements. Supplier history, order value, production lead time and payment method also affect negotiation.

Do not prescribe one structure as universally safe. Compare the buyer's leverage and the supplier's legitimate production costs, then agree milestones before paying the deposit. For trade-finance alternatives, consult your bank or qualified adviser.

Final payment before inspection

Paying the balance before inspection removes a practical opportunity to require corrections while the goods are still at the supplier. If the supplier requires this structure, understand why, reduce uncertainty earlier and negotiate other evidence or controls before the order.

Do not assume platform history or a sample replaces batch inspection. A sample shows one item; final payment covers the production order.

Final payment after inspection

An after-inspection release condition should state what report result and defect limits are acceptable. It should also explain whether rework, replacement or re-inspection is required after a failed or conditional report.

A passed sample inspection reduces uncertainty but does not guarantee every unit. Review the scope, sample selection, tests and exclusions rather than looking only at the word PASS.

Final payment before shipment

Many suppliers require the balance before releasing goods to the forwarder. In that situation, complete the agreed inspection and evidence review while the goods remain under supplier control.

Confirm what shipment-ready means: packed quantity, labels, carton marks, documents, pickup date and unchanged cargo. A freight booking alone does not prove product acceptance.

What to verify before releasing the balance

Build the decision around written release conditions, not urgency. The core file normally includes the approved specification, sample reference, PI, inspection report, corrective-action evidence, packing list, shipping plan and current beneficiary details.

Open the Pre-Shipment Inspection Checklist before production finishes, not after the inspection is booked.

Inspection report

Confirm the supplier, location, product, SKU, quantity, inspection date and sampling basis. Review photos and individual findings. Check whether required tests were actually performed and whether any area was not available.

If the report is from the supplier, distinguish internal QC from independent inspection. Either can be useful, but they provide different independence and evidence.

Rework and defect closure

Do not close findings because the supplier says they are fixed. Request dated, order-specific photos, videos, updated counts or re-inspection depending on severity and detectability.

Record accepted concessions in writing. If a defect changes price, warranty or customer risk, update the commercial documents before release.

Quantity and packing evidence

Compare finished and packed quantities with the order. Review carton count, units per carton, gross and net weight, dimensions and packing-list totals.

For partial completion, confirm whether the buyer accepts split shipment and who pays additional freight. Do not release the full balance against an unclear remaining quantity.

Carton marks and labels

Confirm product labels, barcodes, FNSKU where applicable, country-of-origin marking, warning labels, carton marks and shipping references. Use photos from several cartons, not one staged package.

Incorrect labels can block receiving even when the product is functional. Include label acceptance in the inspection checklist.

Product test evidence

Review order-specific function, dimension, material and performance checks. Certificates or laboratory reports should match the product model, applicant, manufacturer and destination requirement.

Do not treat a PDF certificate as proof that the inspected batch uses the tested materials. Connect compliance evidence to purchasing specifications and change control.

Machinery test and commissioning evidence

For machinery, define factory acceptance tests, capacity, voltage, safety devices, sample output and operating conditions. Review an uncut operation video or witnessed FAT where appropriate.

Confirm manuals, drawings, spares, tooling, installation plan, training, warranty, export crate, lifting points and packing evidence. Installation or commissioning costs should remain explicit rather than assumed.

Shipping booking and documents

Confirm pickup or booking readiness, Incoterm, named place, forwarder contact and required commercial invoice, packing list, certificate or transport documents. Use the Freight Quote Brief Generator if freight scope is still unclear.

Shipment documents can support release conditions, but banks and carriers do not verify product quality merely by handling documents.

Changed bank details

Compare final payment instructions with the deposit record. Any changed beneficiary, account number, bank country or email domain requires independent confirmation.

Follow the Chinese supplier changed bank account guide and do not verify only through the same email thread that announced the change.

Final Balance Release Checklist

Use this checklist as a release record. Adapt it to the contract, product risk and inspection plan agreed before production.

What to do when inspection fails

Pause release and separate critical, major and minor findings. Ask for root cause, affected quantity, corrective action, completion date and evidence. Decide whether rework, replacement, price adjustment, re-inspection or cancellation is allowed by the agreement.

Do not let the forwarder's pickup deadline replace the acceptance decision. If the issue is material or disputed, obtain qualified legal or technical advice.