In today’s world where cost reduction, increase in revenues and quicker response time are the driving force for any company. It is often a wise choice for a company to procure one or many products/parts (instead of manufacturing them) which might be required to come up with the desired finished product.
Eventually, an organization ends up in a scenario where it has bought a part from its supplier with a valid supplier warranty, uses this part to get its product ready and offers the fully finished product to the customer with valid customer warranty.
In the above scenario, there is a chance that a part’s issue for which the customer complains is due to the “part” that the company had procured from its supplier.
Hence, after the company takes care of fixing the customer issue, they go back to the supplier and claim the amount that it has spent on the fixing the customer issue. This is done with reference to the valid supplier warranty that the company had previously arranged. There definitely can be some negotiations involved here, but once both the supplier and the company agree on the claim, the company bills its supplier and the supplier pays back the company its due amount.
For practical insight, see the accompanied video embedded in this screenshot:.