Supplier settlement offer memo
Use this memo after evidence has been archived and the buyer is ready to make a final, documented settlement proposal. It keeps the offer tied to facts, protects internal approval logic, and prevents informal chat promises from becoming an uncontrolled compromise.
Use it when
- A supplier dispute has enough evidence to support a refund, credit, rework, replacement or payment reserve.
- Both sides are still negotiating and a formal offer may avoid chargeback, legal escalation or relationship termination.
- Finance, sourcing and management need one shared note before releasing balance payment or closing a claim.
- The buyer wants a clear deadline and acceptance rule rather than open-ended back-and-forth messages.
Offer principle
A settlement offer should be specific, time-limited and evidence-based. It should say what is being accepted, what is being waived, what remains reserved, and what happens if the supplier does not accept by the deadline.
Memo structure
| Section | What to write | Decision value |
|---|---|---|
| Case reference | Supplier name, PO/PI number, shipment, invoice, disputed amount, current payment status and owner. | Prevents the offer from being separated from the transaction record. |
| Evidence basis | Short links or file names for agreement baseline, shipment proof, defect/shortage evidence and supplier response history. | Shows the offer is supported by archived facts rather than pressure. |
| Proposed settlement | Refund, credit note, replacement goods, rework, discount, reserve release amount or mixed remedy. | Turns the dispute into one executable commercial action. |
| Conditions | Deadline, payment sequence, document requirements, replacement timing, warranty coverage and no-admission / no-waiver wording if needed. | Limits future ambiguity and protects the next order decision. |
| Fallback path | What happens if the offer is ignored or rejected: continue hold, activate backup supplier, file claim, start chargeback review or close relationship. | Makes non-response operational instead of emotional. |
Settlement offer template
“Based on the attached PO, payment proof, shipment records, inspection/arrival evidence and prior messages, our documented affected value is [amount]. To close this case without further escalation, we propose the following settlement: [refund/credit/replacement/rework/reserve release]. This offer remains open until [date/time]. Acceptance requires written confirmation and completion of [documents/action/payment] by [deadline]. If not accepted by that time, we will proceed with [fallback path] using the archived evidence file.”
Internal approval checks
- Does the proposed value match the documented affected quantity and real recovery cost?
- Has finance approved the payment hold, reserve release or credit-note treatment?
- Does the settlement preserve warranty or replacement obligations that remain open?
- Is the fallback path already prepared if the supplier delays again?
- Will the settlement affect supplier scorecard, repeat-order approval or volume transfer?
Closure note after acceptance
After the supplier accepts, save the final written confirmation, payment or credit evidence, replacement/rework schedule, updated claim tracker and a short closure note. Mark whether the supplier is retained, watched, restricted, or moved into replacement planning.
Connected tools: dispute evidence archive, supplier claim settlement tracker, post-claim requalification scorecard, and repeat order approval matrix.