Your Korean importer asks for a discount or a credit note: when to give way, when not to, and how to say it
Published 2026-09-06
It arrives in different forms. "The market has dropped and we cannot sell at this price." "Our end customer has cancelled and we need support." "We will accept the order if you issue a credit note for the last one." And the most direct: "No discount, no next order."
It is a legitimate commercial request in any market. What makes it different in Korea is when it tends to arrive, how it is presented, and what giving way means.
What is behind the request
In my experience, a discount request in Korea comes from one of four situations, and it pays to identify which before answering.
A real market drop. The reference price in Korea has fallen since the order was signed, the importer holds expensive stock and needs to align cost. Verifiable with public import price data and with what other suppliers are doing.
A problem with their customer. A retailer or distributor has cut volume or cancelled, and the importer passes the problem up the chain. The importer has a real problem, but it is not yours.
A limit test. The importer is measuring how far the foreign supplier will bend. More common in new relationships and at the first contract renewal. What is conceded here becomes the base for every future conversation.
A cash squeeze. The importer cannot pay the full invoice now and the discount is the way to present that without admitting it. This one needs the most care, because what looks like a price negotiation is actually a collection risk.
What giving way means in Korea
A discount granted to a Korean importer is not an isolated transaction. Inside the importing company it is recorded as the new reference price, and the person who obtained it presents it internally as a win. At the next negotiation, the starting point will be that price, not the original one.
And in concentrated sectors, the price an exporter sold at to one importer travels quickly to the others. It is not unusual for a discount to one client to be followed by similar requests from two more.
None of this means never give way. It means give way in a form that creates no precedent: tied to a volume, to a deadline, to a specific situation that does not repeat, and always documented as an exception.
How to set your limit before answering
Before replying, I need the client to have three numbers clear.
The cost of losing the order, which includes the margin, but also the cost of re-placing the product, the impact on production, and the value of the relationship if the importer matters in Korea.
The cost of granting the discount, which includes the immediate figure but also the effect on future orders and on other clients in the same market.
And the cost of not getting paid, if the discount request is hiding a cash risk. In that case the conversation is not about price, it is about payment security, and it has to be treated as such.
With those three numbers, the answer is usually obvious. Without them, the decision is made on impulse, and the impulse in these situations is to give too much or to close down too hard.
How to say no, and how to say yes
Saying no in Korea without damaging the relationship requires offering something. Not necessarily money. It can be flexibility on delivery, a specification tweak that lowers their cost, support with commercial material, or a commitment to review price on a set date if the market stays where it is. What does not work is a flat no, because it leaves your contact with nothing to take to their boss.
Saying yes requires explicit written conditions: amount, the order it applies to, the linked volume or deadline, and the sentence that this is an exceptional adjustment that does not modify the contract terms. That last sentence sounds formal. It is the one that prevents next year's conversation.
In both cases, the answer has to reach the right level. If your usual contact is the one asking, the reply goes to them, but in a form they can present upward without losing face.
A composite case
A meat exporter received a request for a 12 percent credit note on an order already delivered, with the warning that the next annual contract depended on it. The importer cited a market drop.
Import data showed a real drop, but of 5 percent, and concentrated in a different cut from the one supplied. A 4 percent adjustment on the next order was offered, tied to a minimum annual volume and documented as an exception. The contract renewed. The delivered order was paid in full.
Details of this case have been altered for confidentiality.
If this request is on your desk
Before replying, it pays to know which of the four situations it is and what your real limit is. I offer an urgent 50-minute call, with a prior review of up to five documents and a written summary of recommended steps. Fixed fee, USD 350, credited if the case continues to a full assessment within seven days.
I reply within one Korean business day.