Most Indian tile factories ask for an advance payment before they start production, with the balance due before shipment or against shipping documents. The share is negotiable and depends on the factory, the order and your track record. The safest advance is the smallest one you can agree, tied to checkable steps.
We do not give a standard percentage, because it varies and a figure copied from a forum may not suit your order. This article explains how to decide and how to protect what you pay.
Why do factories ask for an advance?
A tile order commits the factory to materials, kiln time and, for custom designs, new setups. If a buyer cancels, the factory is left with stock it cannot easily sell. An advance covers that risk and shows commitment.
That reason is fair, but it does not make every request safe. The most common problem is a deposit paid to a trader or an unverified company that never produces the goods. Check who you are dealing with first; see how to verify a tile supplier in India.
How much advance should you accept?
Think of it as a ratio of risk. A larger advance suits a custom design for which the factory carries real cost, a smaller one suits stock designs, and a proven supplier justifies better terms than a new one. For a first order, aim for a minority share of the total, with the rest tied to inspection and shipping documents.
Compare options against the payment methods in safest payment terms for tile imports and tile order payment terms. A letter of credit or documents-against-payment route can replace a cash advance where the factory accepts it; see LC and CAD for tile imports.
How do you protect an advance?
Combine several safeguards rather than relying on one:
- Pay only to a bank account in the exact legal name on the proforma invoice and the contract, never to a personal or third-party account.
- Confirm the company's registration and its factory address before paying; see what a factory audit should contain.
- Put the specification, quantity, grade, packing and shipment date in a signed proforma invoice or contract, as described in the proforma invoice checklist.
- Release the balance only after an inspection report confirms the goods match, and before the goods leave the factory's control.
- Keep records of every payment, message and approval.
What if the factory delays or fails?
Write into the contract what happens if production starts late or the shipment date is missed, including whether the advance is refundable. See tile contract penalty clauses. Without those terms, recovering an advance from abroad is slow and uncertain.
Bank transfers are hard to reverse. If you suspect fraud, contact your bank immediately and keep the evidence. Also check the factory's history before you pay, using checking a Morbi exporter's history.
Next step
Check how the factory has treated earlier customers who paid an advance. Ask a reference whether production started when promised and whether the goods matched the sample. That one conversation can tell you more about the risk than any document the factory supplies.
We can verify the factory, review the proforma invoice, inspect production and supervise loading before your balance is released. Book a free sourcing review, or read about our services.