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Customer's customer cancels order due to a couple of bad apple parts...

GTAW you need 500+ amps with 100% HE, water cooled torch and hope to hang in their jamming filler around with a hot torch. No thanks.
You make it sound like a bad thing haha.

I’ve welded near 400 amps TIG before on my machine. It’s quite fun. But you need a torch that can handle it and a big water cooler. My water cooler can handle 600amps so my torch never got hot with its duty cycle being 350.

Where many go wrong with high amperage welding is crappy PPE. They don’t have the right gloves and arm protection.
 
Be glad you do not do work for the auto world.
You would be backcharged for the inspection time.
This is nothing, trivial compared to line and plant down time.
This is in the fine print of 30 pages when you take the order. Nobody reads all of this, you just sign it.
.....Until one oops. Most just file bankruptcy. The big guys take a many million dollar hit and go on as if normal.
Bob
 
This new batch they ordered, the issue was addressed. Parts made, parts delivered, parts accepted, parts rejected out of fear these would also fail. Come to find out, after all these years, they want a 1/4" fillet around the joint... fillet weld symbol is on the drawing without filler size call out, no weld process or filler metal call out on drawing in the fish tail of weld symbol. The engineer has no clue what process is to be performed, they just want a 1/4 fillet around joint... ok. I request an updated drawing with a weld process call out. Crickets.

Next day, we have a meeting, QC/Purchaser/QC director and an engineer. I address the issues the part failed from and let them know I was confident I could re-work them and or replace them with a new FAI report. I offered them a vast array of solutions without excuses. They agree to it. 2 days later, their customer cancels the entire order over $35K worth of parts and my customer is now requesting a credit memo for this job this.

Clarity on the timeline is important in this scenario. It sounds like the customer found an issue in one lot (was that lot paid for already?).

They then ordered a new lot (replacement for the prior or brand new order?). You built and delivered that lot and it was accepted. Subsequently they decided they want to change the design of the part or did they identify that the parts didn’t meet print at that time?

Details of the sequence matters a lot. If they ordered new parts after the failure without requesting any design changes or you fully implemented any changes and you delivered the parts, they would be responsible for paying.

Because you delivered the parts, it doesn’t seem like this is a case of a canceled order. This seems like the case of a rejected order. Do any of your contracts provide any clarification on how to treat rejected orders? Is there a specific window of time for them to reject? Now you might be in a problem because you agreed to receive the parts back.

There are lot of moving pieces in this scenario. If you detail out the full sequence of events and it is clear that the customer ordered the parts in bad faith, ie not clarifying design requirements after knowing about a potential issue. Now that timeline may also identify that you made guarantees that removed their responsibility. This is all more complex with the middleman involved.

The best case scenario is that you can write a clear letter that explains why they are responsible for the paying the cost of the parts. That might get some traction.

I have been on the other side of this with a vendor demanding payment for defective parts on a time and material build. I had actually been at their site and identified equipment running out of spec. I contacted the equipment manufacture who informed me they had previously told the vendor to not run the equipment in that condition. So pretty simple case. Vendor was holding some of our own equipment hostage. It cost $35k in lawyering to get out a $140k bill. $8k more extracted $43k to cover our legal fees. I had reasonably sound contracts to cover who was responsible for what and it still was a huge time sucking cluster.
 
You make it sound like a bad thing haha.

I’ve welded near 400 amps TIG before on my machine. It’s quite fun. But you need a torch that can handle it and a big water cooler. My water cooler can handle 600amps so my torch never got hot with its duty cycle being 350.

Where many go wrong with high amperage welding is crappy PPE. They don’t have the right gloves and arm protec

You make it sound like a bad thing haha.

I’ve welded near 400 amps TIG before on my machine. It’s quite fun. But you need a torch that can handle it and a big water cooler. My water cooler can handle 600amps so my torch never got hot with its duty cycle being 350.

Where many go wrong with high amperage welding is crappy PPE. They don’t have the right gloves and arm protection.
If they buy me a new Tig machine, I'll rock it, but still, there's no weld process call out on drawing. So I'm still left to guess what they really need. I know, but I'm not going to give up that info.
 
Clarity on the timeline is important in this scenario. It sounds like the customer found an issue in one lot (was that lot paid for already?).

They then ordered a new lot (replacement for the prior or brand new order?). You built and delivered that lot and it was accepted. Subsequently they decided they want to change the design of the part or did they identify that the parts didn’t meet print at that time?

Details of the sequence matters a lot. If they ordered new parts after the failure without requesting any design changes or you fully implemented any changes and you delivered the parts, they would be responsible for paying.

Because you delivered the parts, it doesn’t seem like this is a case of a canceled order. This seems like the case of a rejected order. Do any of your contracts provide any clarification on how to treat rejected orders? Is there a specific window of time for them to reject? Now you might be in a problem because you agreed to receive the parts back.

There are lot of moving pieces in this scenario. If you detail out the full sequence of events and it is clear that the customer ordered the parts in bad faith, ie not clarifying design requirements after knowing about a potential issue. Now that timeline may also identify that you made guarantees that removed their responsibility. This is all more complex with the middleman involved.

The best case scenario is that you can write a clear letter that explains why they are responsible for the paying the cost of the parts. That might get some traction.

I have been on the other side of this with a vendor demanding payment for defective parts on a time and material build. I had actually been at their site and identified equipment running out of spec. I contacted the equipment manufacture who informed me they had previously told the vendor to not run the equipment in that condition. So pretty simple case. Vendor was holding some of our own equipment hostage. It cost $35k in lawyering to get out a $140k bill. $8k more extracted $43k to cover our legal fees. I had reasonably sound contracts to cover who was responsible for what and it still was a huge time sucking cluster.
*Yes to your first question. 2nd party have been passing these through QC all this time to end user (3rd party).

*They ordered new lot. Then 3rd party later identify that the parts didn’t meet print at that time.

*Need to review contract if one exists. I've been managing our machine shop since my dad retired, so essentially I'm dealing with old customers. Maybe a new contract should be implemented.
 
If they buy me a new Tig machine, I'll rock it, but still, there's no weld process call out on drawing. So I'm still left to guess what they really need. I know, but I'm not going to give up that info.

Honestly I don’t think your issue is with the final customer. You were making parts by the contractor that was contracted by the final customer. That contractor had you make large to supply to them for their job. If they approved those parts it’s really on them if the final customer wasn’t happy.
 
Honestly I don’t think your issue is with the final customer. You were making parts by the contractor that was contracted by the final customer. That contractor had you make large to supply to them for their job. If they approved those parts it’s really on them if the final customer wasn’t happy.
You are correct. They passed these parts through their QC.
 
I strongly suggest you contact a lawyer to review all the documentation regarding the order details. The education this consultation may provide, probably will be money well spent in future dealings. With the impending economic down turn there will be other bumps in the road with getting paid. Some companies will return parts so they don’t have to pay for them once they find a cheaper supplier or their market disappears even though the parts are within specification.

I have found a letter from an attorney outlining why you need paid to all parties is critical notification you expect honest treatment and don’t want to be a corporate victim.
 
In this particular case, it'll cost you more than $9K to collect the $9K.

It's also not enough money to lose sleep over.

:eek::willy_nilly:

If being half as smart made me half as successful, then I wish I was half as smart as you. Here I'm trying to scrape an extra $600 together to get one of your black friday vices that are on sale, and $9K isn't even worth losing sleep over for you.

Ha!

Wow....
 
In this particular case, it'll cost you more than $9K to collect the $9K.

It's also not enough money to lose sleep over.

Sounds like the the customer of the customer needs a fall guy and you're that guy. It happens.

A decent Lawyer might charge $500 to fire off a letter. That would be a free consultation, and 1 hour composing a letter if they don't already have a letter formatted ready.

If the letters don't work, you have to deside how far/how hard your going to push the issue. It could take a while, and will consume your life, at some point it's not worth the aggravation.
 
As hint-n-run said in post 32, ... most people are reasonable and most people try to do well.

Even in difficult situations - where blame is mostly non-existent but the excrement just hit the rotary impeller.
Generally, reasonable people get reasonable solutions - where everyone loses some money, but the contractor or fabber is not left holding the bag.

Some (few) people are pro douche-bags.
I would never ever touch one of their projects - even pre-paid.
I know some like that and walked away well before getting burned.
 








 
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