Case 12: The Will Garments Non-Payment Dispute
This case examines a trade dispute in which a Korean exporter failed to receive payment from Bangladeshi buyer Will Garments. Although the assignment began as an overseas market research request, the practical priority quickly became local investigation and mediation support aimed at recovering outstanding export receivables. The case records how KOTRA Dhaka conducted a buyer status review, facilitated direct mediation, and supported payment recovery, while also drawing lessons for preventing similar disputes.
Non-payment
Dispute Type
Export receivables recovery
$45,000
Outstanding Amount
Garment accessories
6 months
Overdue Period
After shipment
18 days
Investigation Period
Request to first result
70%
Recovery Result
$31,500 recovered
3 months
Total Duration
Full process
Background and Timeline of the Dispute
Overview of the Will Garments Non-Payment Case
| Item | Details |
|---|---|
| Korean company | Company A (garment accessories exporter based in Gyeonggi-do) |
| Buyer | Will Garments Ltd. (Dhaka, Bangladesh) |
| Products | Garment accessories such as zippers, buttons, and labels |
| Contract value | $45,000 (three split shipments) |
| Payment terms | T/T, 60 days after shipment |
| Shipment completion | March-May 2025 (three shipments) |
| Due dates | May-July 2025 |
| Buyer explanation | Claimed temporary cash-flow difficulties |
| Request date | November 2025 (six months after due date) |
Trade Office Investigation and Mediation Process
01
Step 1: Buyer Status Investigation
The trade office verified Will Garments' business registration, visited the factory site, and reviewed its operating status. The company was found to be operating normally and running a garment factory with roughly 200 employees. The evidence suggested that the core issue was weak payment intent rather than a complete business shutdown or extreme financial distress.
02
Step 2: Formal Warning Letter
KOTRA Dhaka sent an official letter to the representative of Will Garments. The letter confirmed the unpaid balance, highlighted the Korean exporter's potential legal options, and noted that the buyer could be reported to relevant Bangladeshi authorities as an unreliable trading counterparty. This was intended to raise the pressure for immediate payment.
03
Step 3: Face-to-Face Mediation
A KOTRA officer met directly with the Will Garments representative to negotiate a repayment schedule. The buyer proposed repayment in three monthly installments of USD 15,000, linked to incoming export L/C proceeds, and Company A agreed to that framework. The parties then signed an MOU and fixed the repayment schedule.
04
Step 4: Recovery Monitoring
The first USD 15,000 was paid on schedule, but delays emerged from the second installment onward. The trade office then issued additional warning letters and conducted follow-up calls, which helped secure a second recovery of USD 16,500. The remaining USD 13,500 is under final negotiation, with a prepayment condition attached to the buyer's next order.
Prevention Lessons and Practical Takeaways
Problems Seen in This Case
Payment TermsPost-shipment T/T, high risk
Credit ReviewNot conducted before transaction
ContractWeak dispute resolution clause
Response TimingSix-month delay, harder recovery
Preventive Measures
L/C TransactionsRequire L/C for new buyers
Credit ChecksUse KOTRA credit investigation services
Trade InsuranceEnroll in K-SURE export insurance
Early ActionRequest support after 30 days overdue
Request Filed
Reported USD 45,000 unpaid
→↓
Buyer Review
Site visit and status check
→↓
Official Letter
KOTRA demand for payment
→↓
Mediation Meeting
Installment MOU signed
→↓
First Recovery
USD 15,000 payment confirmed
→↓
Further Recovery
USD 16,500 plus final balance talks
Overseas Market Research Case 13: Potential Buyer Review for Korea International TradingMove on to the next case
Overseas Market Research Case 8: Identifying Importer Contacts for Korea International TradingSee the first Korea International Trading research case
Case 12 is best understood not as standard market research, but as a practical trade office mediation case addressing unpaid export receivables. Through a structured sequence of buyer investigation, formal notice, face-to-face mediation, and installment repayment management, 70% of the USD 45,000 claim, or USD 31,500, was recovered. The case highlights both the risk of post-shipment T/T terms and the importance of early intervention.
overseas market researchWill Garmentsnon-paymenttrade claimcase study
Related Articles
Trade & Business