China Factory Sourcing Checklist: Quotes, Payments, Approvals

Before confirming a factory in China, issuing a purchase order, paying a deposit, or making another financial commitment, verify that every material term is written, attributable, consistent, and approved. The record should connect the final quotation, contracting entity, authorized contacts, payment beneficiary, commissions, contract terms, and negotiated changes. This assessment belongs to supplier qualification and commercial negotiation. It tests whether the proposed transaction is documented and controlled—not whether every term is favorable or the factory will perform reliably.

Require a traceable record linking the final quotation, contracting entity, authorized contacts, payment instructions, commissions, approvals, and agreed changes. Pause the order if material terms remain verbal, payment details cannot be independently confirmed, or an undisclosed payment is requested. These controls do not by themselves prove legal compliance, product quality, or supplier reliability.

Define the pre-order decision standard

This checklist applies from the initial request for quotation through commercial negotiation. It ends before supplier confirmation, purchase-order release, deposit payment, or another financial commitment. The purpose is to determine whether the prospective factory has a clear quotation, contracting, amendment, invoicing, and payment process.

An individual Reddit discussion about a reported payment request raises a useful control question: What should a buyer do when a commission or payment request appears outside the documented quotation and approval process? The account should not be treated as evidence that the situation is common, culturally expected, lawful, unlawful, or representative of factories in China.

Use the following terms consistently:

• Written quotation: A dated, attributable offer identifying the products or services, price, currency, quantity, validity period, and commercial assumptions.
• Authorized contact: A person whose authority to negotiate, amend terms, provide payment details, sign documents, or accept an order has been confirmed through the supplier organization.
• Approved payment channel: A beneficiary account and payment method verified and accepted under the buyer’s authorization policy.
• Disclosed commission: Compensation to an agent, consultant, employee, or other intermediary identified in the transaction records, including the recipient, purpose, calculation basis, payer, and approving parties.
• Audit trail: The retained sequence of quotations, messages, revisions, approvals, contracts, invoices, and payment records showing who agreed to what and when.

A prospective factory passes the documentation test only when it can explain its workflow and connect each material term to an authorized person and a retained record. The buyer should also be able to escalate conflicting instructions without relying on the person whose authority or request is under review.

Map the negotiation into a controlled workflow

Stage	Record to obtain	Buyer-side control	Pause or escalate when
Initial inquiry or RFQ	Written specification, quantity assumptions, target schedule, and requested quotation format	Give prospective suppliers the same material requirements where comparison is intended	The supplier prices a materially different specification without identifying the difference
Supplier quotation	Dated, versioned quotation attributed to the proposed contracting entity	Check specifications, quantity, currency, price basis, validity, lead time, tooling, packaging, delivery terms, and payment schedule	Important charges or assumptions remain verbal or undefined
Commercial negotiation	Written record of requested changes and the corresponding revised offer	Maintain a change log rather than overwriting earlier versions	A contact changes price, beneficiary, commission, or scope without clear authority
Final offer or pro forma invoice	Final commercial document matching the agreed quotation	Reconcile entity names, totals, currency, bank details, deposit, balance, and referenced specifications	The payee differs from the contracting party without documented explanation and approval
Contract or purchase order	Signed contract, accepted purchase order, or another reviewed agreement appropriate to the transaction	Set document precedence and require written amendments	The quotation, contract, invoice, and purchase order contain conflicting terms
Payment authorization	Internal approval record and independently verified beneficiary details	Separate payment preparation from approval where the buyer’s policy permits	Instructions arrive through a new contact, personal account, or unverified message
Order release	Completed pre-order checklist and documented exception approvals	Name the person authorized to release the order	A mandatory control remains incomplete

Test the factory’s process before accepting its final offer:

1. Ask who prepares and approves quotations.
2. Ask which legal entity will sign the contract and receive payment.
3. Ask who may negotiate prices, commissions, or payment terms.
4. Ask how revised quotations are numbered and communicated.
5. Ask how bank-account changes are authorized.
6. Ask whom the buyer should contact if instructions conflict.

After a call, meeting, or chat, place every material outcome into a durable written record. Identify the term, relevant document version, parties, and effective date, then ask an authorized supplier contact to confirm or correct the summary. An informal message can support the audit trail, but buyers should not assume that it alone resolves authority or contractual enforceability.

Pre-order quotation, payment, and approval checklist

Use the status columns to record Complete, Exception approved, or Not applicable. Every completed or excepted item should identify its evidence location and reviewer. “Not applicable” should be selected only when the reason is documented.

Control area	Checklist item	Acceptable evidence or confirmation	Stop or escalation trigger	Complete	Exception approved	Not applicable	Evidence location	Reviewer
Supplier identity	Record the full name of the proposed contracting entity	Quotation, contract, registration information supplied for review, and invoice use the same identifiable entity or explain differences	Entity names conflict or the seller will not identify the contracting party	☐	☐	☐
Quotation ownership	Identify who issued and approved the quotation	Named contact, role, date, quotation number, and company-confirmed communication route	Quote is anonymous, undated, or attributed only to an unverified intermediary	☐	☐	☐
Product scope	Match the quotation to the required product, specification, sample, drawing, or service scope	Referenced specification version and written list of inclusions and exclusions	Price depends on an undefined or substituted specification	☐	☐	☐
Commercial terms	Confirm quantity, price, currency, validity, lead time, packaging, tooling, and delivery responsibilities	Final written quotation or agreed commercial schedule	Material charges or responsibilities remain open	☐	☐	☐
Version control	Preserve each quotation revision and identify the final version	Sequential versions, dates, change log, and final approval	Earlier and later versions conflict without explanation	☐	☐	☐
Payment schedule	Document deposit, milestones, balance, and release conditions	Contract or purchase order aligned with the invoice or pro forma invoice	Payment timing differs across documents	☐	☐	☐
Payment beneficiary	Confirm beneficiary name, bank, account details, and relationship to the contracting entity	Instructions verified through a previously confirmed organizational contact or another buyer-approved process	Last-minute account change, personal account, unexplained third party, or inability to verify	☐	☐	☐
Payment authority	Identify who may create, approve, and release payment	Internal authorization record consistent with the buyer’s approval limits	One person can change supplier details and release funds without required review	☐	☐	☐
Commission disclosure	Ask whether an agent, employee, consultant, or intermediary receives compensation connected to the order	Written recipient identity, service, amount or calculation basis, payer, contractual treatment, and approvals	Request is personal, undisclosed, inconsistent with the documents, or conditioned on remaining off record	☐	☐	☐
Authorized supplier contacts	List contacts permitted to quote, negotiate, sign, invoice, and change payment instructions	Supplier-confirmed names, roles, and communication methods	Instructions come from an unlisted or newly introduced person	☐	☐	☐
Buyer authorization	Assign authority for price acceptance, contract approval, exceptions, and order release	Approval matrix or named decision owners	A negotiator commits beyond delegated authority	☐	☐	☐
Contract terms	Align legal names, specifications, price, delivery responsibilities, inspection or acceptance terms, amendment process, and selected remedies	Reviewed contract or purchase order with referenced attachments	Material terms are missing or conflict with the final quotation	☐	☐	☐
Document precedence	State which record controls if the contract, purchase order, quotation, or invoice conflicts	Precedence clause or written resolution of inconsistencies	The parties rely on different documents as the final agreement	☐	☐	☐
Change control	Require material changes to be written, attributed, dated, and approved	Signed amendment, revised purchase order, or another approved change record	A verbal instruction changes price, quantity, payee, specification, or timing	☐	☐	☐
Escalation path	Name supplier and buyer contacts for disputes, payment anomalies, and authorization questions	Escalation list with roles and verified contact methods	The only escalation route is the person whose instruction is being questioned	☐	☐	☐
Record retention	Specify where negotiation and approval records will be stored and who controls access	Central file containing messages, attachments, versions, approvals, contract, invoice, and payment evidence	Records exist only in personal accounts, disappearing messages, or inaccessible devices	☐	☐	☐
Retention period	Apply the buyer’s approved retention schedule and transaction-specific advice	Recorded retention category and responsible record owner	No retention rule exists or records may be deleted before the transaction is closed	☐	☐	☐
Final release	Confirm all mandatory items or document approved exceptions	Signed checklist naming reviewer, approver, date, and evidence location	An identity, payment, commission, authority, or contract issue remains unresolved	☐	☐	☐

Approval block

• Supplier under review:
• Contracting entity:
• Final quotation number and date:
• Contract or purchase-order reference:
• Approved beneficiary:
• Disclosed commission or intermediary arrangement:
• Open exceptions:
• Exception owner and deadline:
• Decision: Approve / Approve with documented conditions / Pause / Reject
• Reviewer:
• Approver:
• Decision date:

Handle payment, commission, and authority exceptions

A disclosed contractual commission and an off-record personal payment are different documentation scenarios. The control response is to classify, verify, and escalate an unexpected request—not to declare it lawful or unlawful without relevant professional advice.

When a new payment or commission request appears:

1. Do not agree to or send the payment during the initial conversation.
2. Request written details identifying the recipient, purpose, amount or calculation, payer, and relationship to the order.
3. Compare the request with the final quotation, contract, purchase order, invoice, and existing commission disclosures.
4. Confirm the requester’s authority through an independently established supplier contact.
5. Escalate the matter to the buyer’s designated commercial, finance, compliance, or legal reviewer as appropriate.
6. Resume the transaction only after the request has been documented and approved or removed.

The same process applies to other material exceptions:

• Revised price: Review a dated quotation revision that identifies what changed. Pause if only the amount payable changes in a chat message.
• Third-party beneficiary: Require a documented rationale and buyer approval. Do not accept the arrangement solely because a salesperson requested it.
• Bank-account change: Reverify the account through a known contact and repeat the payment-approval process instead of relying on the message announcing the change.
• Intermediary fee: Record the intermediary, service, calculation method, payer, and contract treatment. Escalate if the fee must be concealed.
• Conflicting contacts: Ask the supplier organization to identify who holds final authority, then retain that confirmation before accepting amended terms.

Buyer policy should establish non-negotiable stop conditions. At minimum, pause when the contracting entity is unknown, the payment beneficiary cannot be verified, compensation is requested off record, transaction documents contain unresolved conflicts, a material change comes from a person whose authority cannot be confirmed, or someone pressures the buyer to pay before required approval.

Create the final qualification and audit record

Assemble one indexed pre-order file containing:

• Original RFQ and specifications.
• Every quotation version.
• Negotiation correspondence and meeting summaries.
• Supplier contact and authority confirmations.
• Commission or intermediary disclosures.
• Final contract and purchase order.
• Pro forma invoice or invoice.
• Beneficiary verification evidence.
• Internal commercial and payment approvals.
• Exceptions, escalations, and their resolution.
• Final supplier-qualification decision.

Use consistent file names and version numbers. Preserve original messages and attachments where possible, record who added or approved each item, restrict editing to the responsible team, and apply the buyer’s approved retention schedule. There is no universal retention period appropriate to every transaction, party, or jurisdiction.

The completed file should support one of four decisions:

• Approve: Mandatory controls are complete and the records are consistent.
• Approve with conditions: Limited exceptions have named owners, written approvals, and deadlines.
• Pause: A material identity, authority, payment, commission, or contract issue remains unresolved.
• Reject: The supplier will not provide the buyer’s minimum required documentation.

A complete file supports accountability and later review. It does not guarantee product quality, delivery performance, legal compliance, or the supplier’s financial and operational reliability.

Sources

• Reddit discussion signal: r/Business_China — “Refused a kickback request from a buyer and got told ‘you don’t understand Chinese rules’”
  • Used only to frame questions about undisclosed payments, authority, documentation, and escalation.
  • This is an individual account, not verified evidence of legality, prevalence, business customs, or the conduct of factories in China generally.
  • Private identities and unnamed parties should not be inferred, and comments should not be treated as authoritative guidance.

Scope and limits

This checklist provides buyer-side documentation and approval controls for pre-order assessment. It does not provide legal, tax, accounting, sanctions, anti-bribery, or contract-enforceability advice. It also does not determine whether the cited Reddit account is accurate or whether any reported conduct was lawful.

Appropriate contract language, commission treatment, payment evidence, and retention periods depend on the parties, transaction, jurisdictions, and buyer policies. Obtain relevant professional advice when a payment or commission raises legal or regulatory questions. Until identity, quotation, payment, commission, authority, and contract controls are resolved, pause supplier confirmation, purchase-order release, and payment.