My Chinese supplier sent defective goods. What can I do?

This is a commercial and evidential note, not legal advice, and where the sums are significant it is worth putting in front of a lawyer early rather than late. What follows is about the first week, because the first week is when the position is either preserved or quietly lost.

Do these first

1. Stop and document. Photograph the container seal, the cartons, the labels and the marks before unpacking. Then the goods. Date-stamped, in bulk, before anything is sorted or repacked.
2. Quantify. How many units, what proportion, which defect. "A lot of them are wrong" is not a claim; a defect rate against a sample size is.
3. Give notice, in writing, quickly. Specific about what is wrong and referencing the agreed specification or sample. Many regimes and most contracts require notice within a short period, and a late notice is a defence handed over for free.
4. Do not dispose of the goods. Destroying, reworking or selling the shipment before the supplier has had the opportunity to inspect can weaken or extinguish a claim.
5. Keep paying attention to the contract. Whatever it says about notice periods, inspection rights and remedies now governs, however unhelpful it seems.

What remedies look like in practice

Outcome	When it tends to be available
Replacement or rework at supplier’s cost	The common commercial settlement, especially where the relationship continues
Price reduction or credit against the next order	Where the goods are usable and both sides want to continue
Rejection and refund	Where the breach is fundamental and notice was prompt — harder once goods have been used or sold
Damages beyond the goods (lost sales, customer penalties)	Depends on the contract and on foreseeability; usually the hardest to recover

Leverage

What actually settles these is leverage, and leverage is mostly a function of what you did before the shipment. An unpaid balance is the strongest lever there is. Tooling you own and can move is another. Future volume is one, but only if the supplier believes it. If the goods were paid for in full before shipping and the tooling sits on their floor, the realistic options narrow considerably — which is the argument for structuring payment terms deliberately rather than accepting the first proposal.

Whether the CISG helps you

The CISG has been in force for China since 1 January 1988 and gives a buyer default rules on conformity and on notice of defects. Two qualifications matter before relying on it. China made the Article 1(1)(b) reservation, so it applies in practice where both parties are in contracting states — and several major trading countries are not. And parties may exclude it by agreement, which plenty of contracts do in a clause nobody reads. Check the status table for your own country, then check your contract.

Where the claim would actually run

Before escalating, be clear on three things: which registered entity you contracted with, what your contract says about forum and governing law, and whether a decision from that forum could be enforced where the supplier’s assets are. Most Chinese suppliers hold their assets in China. A judgment that cannot reach them is an expensive document — see whether you can sue a Chinese supplier for what that involves.

The preventable version

Almost every serious defect dispute traces back to one of three omissions: no approved reference sample, no pre-shipment inspection, or a payment structure that left no balance outstanding when the goods arrived. All three are cheaper to fix at order stage than to litigate.