Supplier wants to change quote after order?

S

SC Maintenance

Joined
Jun 8, 2022
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Not looking for a legal answer. More a do you feel this is ethical opinion. It will change nothing in this particular case.

Got a quote - at work so B2B if that matters. It was not a "binding" quote - I know the difference. But it was on the companies letterhead, said "Quote" - not estimate, and was for a very specific quantity and part number. It was catalog items - so nothing changed in scope of work, etc. Just deliver this qty of these small parts. The quote was good for 30 days. We ordered a couple days after receiving it. It wasn't very much money in the grand scheme.

The supplier came back and said there quote was in error. They want to raise the price by about 15% because there loosing money.

My opinion is its there mistake. Its unethical to ask us to pay for their mistake. That's business. You win some you loose some.

If we had not ordered yet, it would be a different scenario. This feels a bit like bait and switch - "thanks for ordering, now pay more"

Do you think this is ethical, or no big deal, take the price increase? Just wondering if my opinion is the norm.
 
SC Maintenance said:
Not looking for a legal answer. More a do you feel this is ethical opinion. It will change nothing in this particular case.

Got a quote - at work so B2B if that matters. It was not a "binding" quote - I know the difference. But it was on the companies letterhead, said "Quote" - not estimate, and was for a very specific quantity and part number. It was catalog items - so nothing changed in scope of work, etc. Just deliver this qty of these small parts. The quote was good for 30 days. We ordered a couple days after receiving it. It wasn't very much money in the grand scheme.

The supplier came back and said there quote was in error. They want to raise the price by about 15% because there loosing money.

My opinion is its there mistake. Its unethical to ask us to pay for their mistake. That's business. You win some you loose some.

If we had not ordered yet, it would be a different scenario. This feels a bit like bait and switch - "thanks for ordering, now pay more"

Do you think this is ethical, or no big deal, take the price increase? Just wondering if my opinion is the norm.
Click to expand...
SCM,

Is the vendor able to absorb the loss if the quote is honored? Was the pricing error intentional or an honest mistake?
 
GON said:
SCM,

Is the vendor able to absorb the loss if the quote is honored? Was the pricing error intentional or an honest mistake?
Click to expand...
Were talking less than $1000. I presume they have $10M in revenue annually - just my guess. I imagine it was an honest error.

More asking about it in principle. They obviously have the right to just not accept the order.
 
GON said:
Is the vendor able to absorb the loss if the quote is honored? Was the pricing error intentional or an honest mistake?
Click to expand...
These are the questions I would ask also. Nonetheless, they have no obligation to fill the order if the pricing is not in their interest.

Happens every day on internet pricing, sales advertisements, etc.

If there is a sales relationship to maintain, then I would think they would honor the pricing. I can say firsthand that I had given quotes and then my quotes were used to get "competitive" quotes (I know this because they used my exact wording on the RFQs sent out). At that point, I no longer gave special consideration to that customer as they gave none to me.
 
S
SC Maintenance said:
Were talking less than $1000. I presume they have $10M in revenue annually - just my guess. I imagine it was an honest error.

More asking about it in principle. They obviously have the right to just not accept the order.
Click to expand...
SCM,

One of America's most successful lawyers wrote a chapter in one of his best selling books "sometimes one has to lose to win".

With the assumption it was an honest mistake by the vendor- I think a course of action is to pay the revised amount. I think more likely than not this vendor will provide you more than $1k worth of unspecified value in the future. This vendor will not forget their error in future transactions with you.

Just my .02
 
imho unethical. Had a Canadian vendor try to claim he got confused with the exchange rate (lying--he quoted us $21k USD when the job was $10k USD at best). he back-pedaled and said $14k CDN. See how the numbers bear no relationship, 21, and 14?

Suppliers who do it are not to be dealt with. I'd pay more, no problem, just to a legit supplier.
 
I think I would need a few more answers before I made a decision:
1. After the revised quote, how does that compare to the second lowest bidder (if there is one)?
2. Does this vendor offer a unique product where we might need to accept this bid?
3. What are additional costs (in time and $$) in going to other vendors on a rebid and suffering longer delivery times in doing so?

There are probably a couple of other questions, but so far, I don't see an evaluation I am comfortable with in waiting or refusing the quote.
 
SC Maintenance said:
Not looking for a legal answer. More a do you feel this is ethical opinion. It will change nothing in this particular case.

Got a quote - at work so B2B if that matters. It was not a "binding" quote - I know the difference. But it was on the companies letterhead, said "Quote" - not estimate, and was for a very specific quantity and part number. It was catalog items - so nothing changed in scope of work, etc. Just deliver this qty of these small parts. The quote was good for 30 days. We ordered a couple days after receiving it. It wasn't very much money in the grand scheme.

The supplier came back and said there quote was in error. They want to raise the price by about 15% because there loosing money.

My opinion is its there mistake. Its unethical to ask us to pay for their mistake. That's business. You win some you loose some.

If we had not ordered yet, it would be a different scenario. This feels a bit like bait and switch - "thanks for ordering, now pay more"

Do you think this is ethical, or no big deal, take the price increase? Just wondering if my opinion is the norm.
Click to expand...
It's not a question of ethics, it was a non binding quote, what if the price of materials or labour or whatever had gone up?
How much time has elapsed between your query and their quote.
Your remedy is not to accept the revision and go elsewhere, you suffered no loss.
 
This reminds me of when I got a mortgage in 2002. The banker locked me in a 0.5% higher than what I said I want to lock in at. Said he was out of the office and can I buy a stock at yesterday's price, today? Sales will always be sales. There will be decent folks, and not so.
 
If it happens once that's one thing. If it happens multiple times then that's another thing. I'd pay the difference this time giving the benefit of doubt that it was an honest mistake but I'd make it clear I'm not happy and that they'd better be more careful with their quotes in the future.
 
In my experience, what matters is the end result. I have been burned pretty badly by lousy work.
I hope it works out OK for you both. If you don't like the change, use another supplier.

Good luck!
 
JayhawkRoy said:
1. After the revised quote, how does that compare to the second lowest bidder (if there is one)?
2. Does this vendor offer a unique product where we might need to accept this bid?
3. What are additional costs (in time and $$) in going to other vendors on a rebid and suffering longer delivery times in doing so?
Click to expand...
1 - don't know - haven't had a second quote - someone else's problem to get if they want. We used them before. The quote for the same stuff a couple years ago was half as much but we still ordered it at the new quote. Lots of stuff went up. This isn't a lot of money for us.
2. - No - lots of places - but I would have to spec something. Its not a pure commodity - its electronic stuff.
3 - were likely buying it either way, hence just looking for opinions - it would take too long to qualify other stuff. Next project - maybe different story. My feeling is it was their mistake and they should eat it? It doesn't affect my pocketbook either way. Am just wondering what others think.
 
Sorry supplier, that's your mistake for not quoting it correctly. And if you didn't quote it correctly, that could mean your manager is incompetent if they can't quote things correctly. Either way, he's going to lose customers and bad for business.
 
"that's business" Well often suppliers are the b[self edited for sensitive ears] in the supply chain. Take Nissan for example, a negotiated price and after six months of a successful launch they are back to "reduce cost" So we ommit this detail that required painting, six months later they are back... again. We hardly make up the design and engineering cost before we are selling them to Nissan "at cost".
 
Do you do business with this company often ? Have they ever done this before ? Sounds like the answer to the 2nd question is "no" but maybe it's the first time you've ordered from them.

Tell them you'd just prefer to cancel the order. If they do nothing, I'd say that means they really were losing money. If they honor the original price, it still doesn't mean they were trying to scam you, it just means they'll honor their quote and potentially lose money.
 
Hall said:
Do you do business with this company often ? Have they ever done this before ? Sounds like the answer to the 2nd question is "no" but maybe it's the first time you've ordered from them.

Tell them you'd just prefer to cancel the order. If they do nothing, I'd say that means they really were losing money. If they honor the original price, it still doesn't mean they were trying to scam you, it just means they'll honor their quote and potentially lose money.
Click to expand...
We do business with them often, but not necessarily this sku. I don't think this has ever happened before, which is why I was surprised. Had they put the 15% on it originally it would have still gotten ordered, so really its not as much about the price as it is about the change after the PO was issued - or at least thats what bothers me.

We will end up ordering it. Someone else's problem on what price we pay at this point.
 
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