Dan Harris of the China Law Blog has a great post today, “How To Protect Your Molds And Tooling In China“. If you are not already a subscriber, you ought to take a minute to become one.

Money ‘graph:

If you do not take the right steps with your Chinese Original Equipment Manufacturer (OEM) before you ship over your mold or tooling, it is nearly certain you will never get them back. As soon as something goes wrong between you and your Chinese OEM manufacturer, the OEM manufacturer typically will use your mold or tooling for ransom. It is the very rare OEM relationship that lasts forever and if you do not take steps to protect your mold/tooling, it will be the even rarer relationship where your Chinese OEM company does not end up with either your mold/tooling or at least with your having to expend considerable funds securing their return.

Amen, Brother. Preach it.

Even though in this case he is referring to tooling provided by the client to the supplier, it is the same with tooling you buy from the supplier or from a contract tooling shop in China. Make sure the ownership of the tool is clear.

PassageMaker has just launched a new Tool and Die Steward (TDS) service that addresses the physical control of your tools. Dan is right that you should have iron clad contracts in place, but what if the vendor damages your tooling, rents it out to a competitor (this really happens), makes a copy of the tooling, goes out of the business and sells the tooling for scrap, etc.? A properly drafted agreement is great, but nothing beats having the tools in your possession.

Our TDS service can be tailored to your needs, but the short version is we take possession of your tool, make sure it is stored properly at our Assembly Center, and when it is time to run your order we will deliver the tool to the supplier for the production run and pick it back up when complete. You can even have our personnel supervise the production run to make sure the vendor treats the tool well and doesn’t run extra parts to sell out the back door.

If you’re like most of our clients, you’ve invested tens of thousands of dollars in tooling in China and it behooves you to look after that investment. Let us know if we can be of assistance!