When you pay a Chinese factory to make a mold, a die or a fixture for your product, you usually think you are buying it. In practice, many buyers discover later that they cannot take the mold to another factory, that the mold is being used to make products for other customers, or that it has worn out or "disappeared". Tooling disputes are among the most common and expensive problems in custom manufacturing in China.
This guide explains how to make ownership clear, how to check the tooling exists and is yours, and what to do before you pay.
Why tooling ownership goes wrong
Unclear payment: you paid a "mold fee", but the contract does not say you own the mold. Some factories treat a partial fee as a contribution, not a purchase.
Amortization: the mold cost is spread over unit prices. Without written terms, the factory can argue you never paid for it.
Subcontracting: the mold is made or kept by another company you have never heard of.
Use for others: the mold is used to make the same product for other buyers, sometimes your competitors.
Lifetime: the mold wears out sooner than expected because a cheaper steel was used.
Put it in the contract
Ownership: the tooling belongs to you from the moment of payment, including drawings and design files.
Specification: number of cavities, mold steel grade, expected life in shots, and the maker of the mold if outsourced.
Marking: your company name and a tool number engraved or stamped on the mold.
Exclusive use: the tooling is used only for your orders.
Storage and maintenance: where it is kept, who maintains it, who pays for repairs, and for how long the factory must keep it after the last order.
Release: the factory must release the tooling to you or to a factory you name within a set time, on request, after paying any agreed final amount.
Confidentiality: a non-disclosure and non-use agreement written for enforcement in China, in Chinese, signed before you send detailed drawings.
Check the tooling exists
Ask for photos and video of the mold during manufacture, at trial, and finished, with your marking visible.
Ask for the trial shot samples (T1 samples) and the trial report.
During a factory audit or inspection, ask to see the mold in storage and photograph its marking and number.
If the mold is made by a separate toolmaker, know the toolmaker's name and address.
Pay in stages
A common structure is a part payment when the mold design is approved, a further payment after the first trial samples are approved, and the last part after final samples or the first production order. Avoid paying the full mold cost upfront to a new supplier.
If you want to move the mold
Moving a mold to another factory is much easier when the contract already covers release and the mold is clearly marked. Before you announce a move, check where the mold is, photograph it, and confirm the release terms. Plan the transfer with the new factory, since a mold made for one press may need adjustment on another.
When to ask me to check
Ask for a check before you pay for tooling with a new supplier, when you want someone on site to confirm your mold exists and is marked and stored as agreed, or before you try to move tooling to another factory. For contract manufacturers, see also Dongguan contract manufacturers and Ningbo mold and appliance suppliers.
Get a Quote on WhatsApp See Factory Audit
LocalAuditChina is an independent verification service, not a law firm. This guide is general information, not legal advice.
Add comment
Add comment: