What a change costs the person asking for it

Three changes to one order

Asking a factory for a small change to an order that already exists feels free. The person asking cannot see what has already been bought or cut. It is not free, and the same request can cost nothing one week and a great deal the next. This lesson prices three ordinary changes to one order, from the side that asked. It also sets out the dates you need from a supplier in order to price your request first.

Between 6 May and 2 June, WN-7305 changes three times. One of them costs nothing, and could have cost nothing more easily. One of them costs more than the amendment says. And one of them is never written down at all, and is by far the most damaging of the three.

The pattern is the same every time, and it is the pattern of a buying office rather than a factory: the change is priced by the person receiving it and never by the person sending it. Whatever the supplier does not charge you for, they absorb. Whatever they absorb comes back next season in a price increase you will describe in a meeting as unexplained.

6 May: the change that was free three weeks ago

Wrenfold's technical team ask for a second care-symbol set on the woven care label, so the jumper can be sold in a second market without a relabel. It is a good idea, it is cheap, and it arrives as a two-line email.

Nabaganga placed the trim order on 20 April. By 6 May, 19,600 woven care labels have been made. At USD 0.038 each that is USD 744.80 scrapped, plus twelve working days to weave the replacements — which lands inside the knitting window on an order that is already seventeen days behind.

The same request on 17 April would have cost nothing: no scrap, no days, one line changed on a trim order that had not yet been placed.

Read that again, because the thing that changed is the interesting part. The request did not change. The design did not change. The person asking did not become less reasonable. The only variable was a date in the supplier's calendar that the buyer's purchase order does not carry. You cannot price your own change request, because you cannot see the commit dates behind it.

So put them on the order. Four dates, asked for once at confirmation and never again:

• yarn committed — after this, a colour change is a new dye lot
• trims committed — after this, a label or button change is scrap
• first knitting or first cut — after this, a specification change is rework
• packing started — after this, a carton or ratio change is a repack

With those four dates on the order record, a change request stops being a hope and becomes a question with an answer: is this before or after the trim commit? On 17 April the answer is before, and the email goes out unchanged. On 6 May the answer is after, and the email goes out with USD 744.80 and twelve days written into it, so the person asking can decide whether they still want it. Most of the time they do. Occasionally they do not, and that is the whole value of asking.

2 June: just add 3,600

The pre-season sell-in has gone well on Oatmeal, and buying ask for 3,600 more pieces. The amendment is one line: plus 3,600 Oatmeal at USD 14.60, USD 52,560.

Three things a buyer instinctively assumes about a quantity increase, and none of them holds.

That volume is cheaper. It is not, on a second run. The Oatmeal dye lot is finished. 3,600 pieces need 1,634 kg more yarn, which is a new lot. It is comfortably over Shitalakhya's minimum, so there is no lot-minimum charge, and that is genuine good news worth saying out loud. But a second lot ships in a second delivery. And a second delivery is a second freight movement at USD 1,180, a second final inspection at USD 420, and a second goods-in and ticketing pass at nine cents a piece, USD 324.

That the price on the amendment is the commitment. The amendment says USD 52,560. The commitment is USD 54,484, which is USD 15.13 a piece against the USD 14.60 you believe you are paying — 3.7% more. That difference does not appear anywhere in the order book, because the order book records units multiplied by the line price.

That it is the same product. It is not. Two dye lots of the same shade are two shades, within whatever tolerance your own colour standard allows, and your distribution centre will mix them in one flow and send both to the same store. The remedy is not chemistry. It is to receive and allocate the second lot whole, which is a conversation with the allocation team rather than with the factory, and belongs to track 18.

And the days. 1,634 kg is sixteen days of dyeing, then four days of knitting at 930 a day, then finishing. The addition ships about five weeks after the main order. If you needed it for the launch, you did not ask for it. You asked for something else and called it the same thing.

13 May: the amendment that never reached the order

This one has no cost on the day, and it is the most expensive of the three.

On 13 May, with the seventeen days finally understood, you agree by email that the ex-factory date moves from 10 July to 27 July, that Oatmeal and Deep Fern will be airfreighted, and that Damson and Bramble follow by sea. Everybody agrees. Everybody performs. Nobody amends the purchase order.

On 3 September the sea leg is received. Wrenfold's system compares the receipt against the order, which still says ex-factory 10 July, and applies the Supplier Manual's late-delivery clause: 5% of the order line value per completed week, capped at three weeks. Seventeen days is two completed weeks. USD 27,156 is deducted from the next payment.

Nobody decided that. No human being read the file, weighed the facts and concluded that Nabaganga was at fault. A field was compared with a field.

What that deduction looks like from the other end — a factory receiving an amendment it never asked for, and a chargeback raised against a date the parties had abandoned — is course 7.6's subject. It is worth reading, because the factory's account of this order is the one your supplier is holding.

Then it gets worse, and it gets worse because of the clause your own company relies on. Section 1.4 of the Wrenfold Supply Terms says no variation binds Wrenfold unless it is issued as a revised purchase order signed by an authorised signatory. Your email of 13 May is not that. Under English law, which your terms choose, a clause of exactly that kind is effective. The fact card below this lesson is the case that settled it. So the agreement everyone relied on for four months may be no variation at all. The clause written to protect Wrenfold from a supplier's informal promises has just made Wrenfold's own promise unenforceable, on a delay Wrenfold caused.

Reversing the deduction takes nine weeks and eleven touches across merchandising, finance and the shared service centre, at Wrenfold's own internal cost of USD 38 a touch: USD 418. Nabaganga finance USD 27,156 for sixty-three days at their 11% cost of money: USD 515.59, which you will pay next season inside a price. Total USD 933.59 in traceable cost, plus a supplier who now believes your deductions are arbitrary — and who is right.

Amending the order would have taken four minutes.

What the order looked like at the end

Two rows deserve a second look.

Row four. The first order was for 18,600 and 19,120 arrived. That is 520 pieces inside the plus 5% you agreed in lesson 1 and never revisited — USD 7,592 of stock you have bought and did not plan, in the sizes the knitting floor produced. It is also 148 pieces above the plus 2% your goods-receipt system will book, so the whole USD 279,152 invoice blocked on arrival, in the same month you were reversing a deduction you should never have made. Neither of those two numbers was chosen for this order by anybody.

Row two. It changed nothing, and it is the reason for row seven. An amendment that is agreed and not recorded is worse than one that is refused, because a refusal leaves both parties knowing where they stand.

The discipline, and it is four fields

An amendment is not an email. It is a state change, and on the buyer's side four things move together or none of them counts.

1. The purchase order, at a new revision, carrying the new quantity, price, dates and any milestone of yours that has moved with them.
2. The intake plan — the warehouse's window and the allocation that hangs off it, so a delivery arriving on a new date has somewhere to go.
3. The supplier's re-confirmation, in writing, against the revised order, so you find out today rather than in September whether they can actually do it.
4. The clocks that punish — the late-delivery clause, the scorecard, the chargeback schedule. Anything that measures the supplier against a date must be measuring the current date, or it is measuring your own paperwork.

Do all four, or write down which one you have skipped and why. And keep the log on the order rather than in an inbox: one row per revision, carrying what changed, the price effect including anything it credits back, the day effect against the float that is left, and who agreed it. Nine columns, and a year later it is the only account of the order that exists.

Act as a supplier's commercial manager who is willing to tell a buyer the truth about what a change costs. I am the buyer and I am about to send a change request. Order as it stands: purchase order [NUMBER] at revision [LETTER], style [STYLE], confirmed quantity [QTY] by colour [BREAKDOWN], price [PRICE], ex-factory [DATE], float remaining against the ship date [DAYS]. Supplier commitment dates as confirmed to me: yarn or fabric committed [DATE], trims committed [DATE], first cut or first knitting [DATE], packing started [DATE]. Material facts: consumption per piece [AMOUNT], material price [AMOUNT], minimum dye or print lot [AMOUNT], material lead time from approval [DAYS], production rate [PIECES PER DAY]. The change I want to ask for: [DESCRIBE IT EXACTLY — QUANTITY, COLOUR, SIZE RATIO, SPECIFICATION, PACKING, DATE]. Do the following. First, tell me which of the four commitment dates this change falls after, and therefore whether it is free, chargeable or impossible. Second, price it line by line from the supplier's side — material at the new lot sizes including any minimum, tooling or plates, testing, scrap of anything already made, extra handling, extra freight, extra inspection, extra goods-in — and give me a total and a cost per piece on the pieces affected. Third, tell me anything the change CREDITS back, such as a minimum charge that no longer applies. Fourth, put a number of days on it, measured against the float I have left rather than the float I started with, and say whether it moves the ship date. Fifth, list plainly what this change does NOT entitle me to: the same price, the same date, the same dye lot or shade, the same shipment, the same carton. Sixth, write the change request itself as I should send it, with the price, the days and the consequences inside it, so the person who asked me for it can decide whether they still want it. If a cost would normally be absorbed by the supplier, say so and say what it will look like in next season's price. Name every assumption in a list at the end.

What you should be able to do now

For any change you are about to ask a supplier for, do four things. State what they have already committed against the four dates on the order. Put a price and a number of days on the request before you send it. Name what the change does not entitle you to. And the moment it is agreed, move the order, the intake plan, the re-confirmation and every clock that measures the supplier against a date. If you only ever do one of the four, do the last one.