A compound term in foreign trade after-sales processes, referring to proactively compensating customers during warranty or repair services due to product quality, delivery delays, or improper repairs, in order to maintain customer relationships and develop future cooperation, while also exploring new needs and promoting secondary sales or value-added services. Commonly used in industries with frequent after-sales repairs such as machinery, electronics, and auto parts. Note: compensation amounts must match contract terms and liability attribution to avoid excessive compensation eroding profits; compensation methods may include refunds, replacements, discounts, free repairs, or extended warranties, and should be clearly documented in writing. It differs from 'after-sales claim' in that the latter focuses on the customer's unilateral assertion, while this term emphasizes the company proactively turning compensation into a customer development opportunity, achieving both crisis PR and business expansion.
📝 Examples
1. For this batch of faulty motors, we decided to implement repair-customer compensation development: first fully replace the damaged parts, then offer a 5% discount on next quarter's orders, and also recommend new models to secure additional purchases. (Note: Combining compensation with discounts and new product recommendations to develop follow-up orders.)
2. Because the previous repair delay caused the customer's production stoppage, we launched a repair-customer compensation development plan: in addition to compensating for downtime losses, we invited the customer to join a new equipment trial program, and ultimately signed a three-year maintenance contract. (Note: Building trust through compensation and converting it into long-term service cooperation.)
💡 Foreign Trade Tips
Foreign trade terms are the foundation of international business communication
Trade practices may vary slightly by country; pay attention when using them
When using terms in contracts, specify the applicable version (e.g., Incoterms 2020)
For unfamiliar terms, use GlobalSync's multilingual email helper to confirm with your partner