Thirty percent down, seventy against the bill of lading. That split is common. What is not common is a sentence that says when the thirty percent comes back — and when it does not. Factories treat a deposit as a commitment fee. Buyers treat it as money parked until something goes wrong. Those two readings only meet if the PI writes the triggers.
This piece is the deposit clause, not a lecture on whether 30/70 is the “right” split.
1. Say what the deposit is for
Write one purpose, not three implied ones. Typical uses are:
- to book production capacity and buy materials for this PO only
- to start tooling or a mold that is described on the same PI
- as a first installment of the price, credited against the invoice
If the same money is quietly doing all three jobs, you will argue later whether a canceled order still “used up” the deposit on steel that was never cut. Name the PO number the deposit attaches to. Money sent “for future orders” with no PO is the easiest deposit to lose.
2. List the events that return it
A short, closed list beats “fair and reasonable.” Examples that factories will sometimes accept:
- they miss the defined ship event by more than X days and you cancel under the late-delivery clause
- pre-shipment inspection fails against the written AQL or golden sample, and they refuse to remake within Y days
- they become unable to perform (license lost, line permanently stopped) and you cancel the unfinished quantity
Put the refund period next to the event — for example, 15 banking days to the same account that paid. “We will discuss” is not a refund term.
3. List the events that keep it
The factory will want the mirror image. Be explicit so they do not invent it after you cancel:
- you cancel for convenience after materials are purchased against this PO
- you change the spec after they have cut or molded, and you refuse the extra cost
- you fail to pay the balance when documents and a passed inspection are presented as agreed
If tooling is involved, split the money on the PI: product deposit vs. tooling charge. A single “30%” that later becomes “mold fee, non-refundable” is how buyers discover they never owned the tool and cannot recover the cash.
4. Where the money sits is part of the clause
Pay the deposit to the same legal name that issues the PI, to a company account, with a bank reference that cites the PI number. A personal card, a different English name, or “pay my cousin in Shenzhen” is not a deposit you can point to in a dispute. If you use Trade Assurance or an L/C, say whether this deposit is inside that channel or outside it — outside it, platform protection usually does not follow.
The bottom line
A deposit is refundable only for the events the PI names, to the account the PI names, within the number of days the PI names. “30% down” without those three lines is a price installment the factory will keep when the relationship sours.
If you need the deposit-refund and forfeiture wording written into the PI in English and Chinese, I can prepare the clause and issue a stamped set under our bilingual translation company seal when you need one. See what this covers.
Deposit and cancellation terms depend on the contract and governing law. This article is general sourcing guidance, not legal advice.