What 30/70 means in practice
You pay 30% of the order value to start production. The factory buys materials and schedules the run. When production is finished, a pre-shipment inspection is done at the factory. If the inspection passes, you pay the remaining 70% and the goods ship. If it fails, the factory reworks before anything leaves.
Most established Chinese factories accept this because it is the market standard. Suppliers who refuse are either very small, very new to export, or counting on you not knowing better.
The cash-flow effect
| 100% upfront | 30/70 | |
|---|---|---|
| Day 0 outflow | $38,000 | $11,400 |
| Day ~40 outflow (after QC pass) | $0 | $26,600 |
| Your money at risk before you see the goods | $38,000 | $11,400 |
| Working capital freed per cycle | — | $26,600 for ~40 days |
On monthly restocks that is a permanent $26,600 reduction in the cash you need to run the same business, with no credit line. It also changes the power balance: a factory that has 70% outstanding answers emails.
Four clauses that make it work
- Inspection trigger: "Balance payable within 5 working days of a passed pre-shipment inspection at AQL 2.5, General Level II, by an inspector appointed by the buyer." Without the inspection clause, 30/70 just means 70% before shipping, whatever the goods look like.
- Rework at seller cost: a failed inspection means rework and re-inspection at the factory's expense, with a defined time limit.
- Bank account match: payments only to the company account named on the business licence. No personal accounts, no "our finance company".
- Governing contract: a purchase contract with a Hong Kong or mainland entity, in English and Chinese, that references the quote, the specification and the inspection standard.
What the factory gets in return
Terms are a negotiation, so offer something. Reliable repeat orders. A fixed restock calendar. Paying the 30% promptly, the day the proforma arrives. Factories value predictability above almost anything, and a buyer who pays the deposit the same day and the balance within five days of a pass is a buyer they want to keep.
When 30/70 does not apply
Custom tooling is normally paid separately, often 50/50 or 100% upfront, because the mould is useless to anyone else. Very small first orders under about $3,000 may be 50/50. Fully bespoke materials the factory cannot resell justify a higher deposit. Everything else, including branded packaging and standard products with your logo, is 30/70 territory.
Frequently asked
What if the factory refuses 30/70? +
Ask why. A new relationship can start at 50/50 with 30/70 from the second order written into the contract. If the refusal is absolute on a standard product, the supplier is signalling something about their cash position.
Is paying through Alibaba Trade Assurance the same as 30/70? +
Trade Assurance holds the money in escrow against delivery, which protects against non-shipment. It does not include an independent inspection before release, so it does not protect against goods that arrive and are wrong.
Who pays for the inspection? +
The buyer, typically $250–350 for one man-day in China. On a $38,000 order that is under 1% of value for the right to withhold 70%.
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Figures are indicative floor rates and typical fee ranges on our lanes as of Oct 11, 2026. Duty rates depend on your product's tariff code and declared value. This is general information, not customs or legal advice.