Are the PPAP samples free? In some cases?

J

Jacobo.BA

#1
I have had a little discussion with the SQA from our main customer, since I have submited the PPAP documentation by reason for submission, Tooling: Additional, and the Level 3, and then he requested me only 6 parts like samples, although normally we do not send parts when we submit a PPAP for an additional tooling.
The main issue is that he do not want to pay this 6 parts from each part number, and we want that they pay us.
Normally, Are free these six parts for PPAP submission in all companies?
Please help me.
 
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J

justncredible

#2
You charge for the entire PPAP, which is 18 sections.

Anything they ask you submit should be already be done. My current big customer only ask for 4 sections, the other 14 are on file. All parts used for studies are clearly identifyed and shipped with the orders.
 

Kales Veggie

People: The Vital Few
#3
I have had a little discussion with the SQA from our main customer, since I have submited the PPAP documentation by reason for submission, Tooling: Additional, and the Level 3, and then he requested me only 6 parts like samples, although normally we do not send parts when we submit a PPAP for an additional tooling.
The main issue is that he do not want to pay this 6 parts from each part number, and we want that they pay us.
Normally, Are free these six parts for PPAP submission in all companies?
Please help me.
It depends what you have arranged with your customer. What does the contract with your customer say?

I have dealt with both cases. One very good customer purchased all 300 PPAP run samples.

I would say in general, customer do not pay for PPAP samples unless it has been agreed otherwise during contract negotiations. You might advice your sales department to include this, if the cost are high.
 

Wes Bucey

Quite Involved in Discussions
#4
FWIW:
In my high-tech contract machining company:
If a customer wanted First Article, PPAP, or final inspection samples (all duly labeled and accompanied by pertinent inspection readouts), then we charged for each piece at the contract rate.

If PPAP was required (almost always was), we had a separate line item charge on the invoice for that time, materials, and labor.

We ALSO charged a separate line item for additional setup of equipment if customer requested deliveries spread over a much longer period than our actual manufacturing time, UNLESS customer was willing to guarantee payment for the entire blanket order plus a storage fee and took the risk of product changes which might make goods in inventory obsolete.

ALL THIS, of course, is part of Contract Review, and points up the necessity of covering as many contingencies as possible BEFORE you agree to the contract!
 
D

Duke Okes

#5
I have had a little discussion with the SQA from our main customer, since I have submited the PPAP documentation by reason for submission, Tooling: Additional, and the Level 3, and then he requested me only 6 parts like samples, although normally we do not send parts when we submit a PPAP for an additional tooling.
The main issue is that he do not want to pay this 6 parts from each part number, and we want that they pay us.
Normally, Are free these six parts for PPAP submission in all companies?
Please help me.
Since you had to purchase and use raw materials, equipment, and labor to produce them, you certainly should be paid for them.
 

bobdoering

Stop X-bar/R Madness!!
Trusted Information Resource
#7
For customer-driven PPAPs, there should be a PPAP order with all of the requirements paid for (300 pcs, etc.)

BUT...if you are PPAPing a change on your end - and they did not request it, it may be on you. If I was a customer, and I didn't ask you to change anything, why would I pay for your issues? :cool:
 
T

tlonkey

#8
I think you need to review the contract and see what terms are called out for sample parts and PPAP submissions.

My experience with the Big Three and now in aerospace is that we have always charged for our sample parts (unless otherwise noted in the contract). The prices can be different for say prototype vs PPAP run-at-rate parts but we always charged. Problem we had was with the delays (yes I am looking at you GM/Chrysler) because of their testing activities and various approvals required by the different departments involved tended to be a long and drawn out process. The "Rush-rush, can you do anything to speed up the PPAP" request never seemed to apply to payment for those services. Sorry for minor rant, we did not have the clout with our major customers that Wes seemed to have. Lots of headaches with a lot of our PPAP submissions and payment for those parts and services.

tlonkey
 

Wes Bucey

Quite Involved in Discussions
#9
I think you need to review the contract and see what terms are called out for sample parts and PPAP submissions.
<SNIP>
The "Rush-rush, can you do anything to speed up the PPAP" request never seemed to apply to payment for those services. Sorry for minor rant, we did not have the clout with our major customers that Wes seemed to have. Lots of headaches with a lot of our PPAP submissions and payment for those parts and services.

tlonkey
The only reason I had "clout" was because I made iron-clad contracts and made sure everyone was on the same page. I found it much more valuable in the long-run to hammer a customer who was slow pay as soon as the due date passed rather than waiting for 60 or 90 days or more, just inviting more abuse.

If a customer requested PPAP and then didn’t respond within the time stated in the contract, I started shooting for higher heads in the hierarchy, pointing out penalty clauses in the contract for the CUSTOMER’s breach and I didn’t hesitate to invoice such penalties, withholding shipments for unpaid invoices.

I managed to negotiate and resolve most problems because I knew that if I were forced to sue for redress, it was smarter to cut my losses and fire the customer. I did have to fire several customers. One firing made me look like a genius because a competitor leaped into my place and ended up getting stung for $250,000 when the customer went Chapter 7 bankrupt 9 months later.


I wasn't a genius, just tired of playing the circle jerk game of "Can you send us another invoice?" or "It hasn't been through incoming inspection and we can't pay until it is approved." when the Contract clearly spelled out different terms. I knew they were stalling and they knew I knew, but they did it anyway. I wrote off $10,000 with them and landed a much more profitable replacement who paid on time. I took the remaining parts of theirs I had in inventory to a forge and watched while they melted them down and gave me back 20 ten-pound bricks of 303 stainless steel.


 
5

50spenc

#10
Hi,

Like many of the comments above I have provided free samples and also had customers pay for them. My personal opinion is that they are saleable goods.

My real point stems from bad past experience, it was - If you send something FOC it tends to get lost in the system, by charging for them they features on the radar a bit more. I now always tend to charge for samples (but hope the customer raises a PO) because it means I have traceability. Hope this helps.

Spencer
 
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