Samsung Will Still Be Required to Pay Galaxy Note 7 Suppliers the Complete Amount
Despite the Note 7 discontinued from the production line, Samsung still owes its partners and suppliers payment for components requested by the company. However, the South Korean manufacturer has displayed tremendous business acumen and has also managed to strengthen the partnership of these suppliers for future endeavors.
Samsung Will Also Compensate Component Suppliers for All Unused Galaxy Note 7 Parts in Full
According to sources close to the matter, Samsung has stated that it will compensate component suppliers for the discontinued Galaxy Note 7 smartphones and will consider giving them orders for other models in order to soften the blow and show to these partners that the company is not letting history become a rift between the entities’ future partnerships. Samsung has also stated that it is going to fully pay for unused Note 7 parts that have already been manufactured, as well as compensate suppliers for unfinished components and pay for materials bought to make Note 7 parts.
Samsung has stated the following in a statement, showing how it will carry out its own ‘check and balance’ run before determining the amount that needs to be paid:
"Samsung will determine the inventory levels for the partner companies and carry out compensation quickly."
This decision comes after some South Korean government and central bank officials stated that the Note 7 crises could have an adverse effect on the domestic economy. A deputy finance minister has stated that the fallout could hurt the economy during the third and fourth quarters of the year. However, the concerns are being stated not on the manufacturing processes of the Galaxy Note 7, but the customers being a key factor to the thriving economy. Keep in mind that majority of Samsung’s phones are manufactured overseas, so this naturally means that the concerns are being voiced in regards to the customers.
This is probably the reason why Samsung has urged its suppliers, employees, and executives, to stay mum on the Galaxy S8, most likely to build up as much hype as it possibly can before the official announcement kicks off. After the fire-prone Galaxy Note 7 stopped getting produced, Samsung expects that this saga is going to cost the manufacturer $5.5 billion in operating profit from the third quarter of 2016 to the first quarter of 2017.
Do you guys believe that Samsung has done the right thing as a business associate of its partners? Tell us your thoughts right away.
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