The distributer said, "actually we don't need this much, so either take back this enormous amount of coffee that we know you can't handle or give it to us for free and you can "write it off on taxes," which leaves the coffee company screwed on their loans. When the coffee company says they want to take it back, the big company tries to make them pay an enormous fee. The grift, as I understand it, is in the distributor saying they needed X and then saying they didn't need it and giving them two shitty options for how to proceed.
Those options were explicitly laid out in the contract they signed, they even say that in the blog post. It's not a grift if they tell you up front exactly what will happen.
What might happen, vs. what a company decided to inflict on you are different things.
Why did the potential buyer have a sudden inability to sell any part of a large order, what changed? Presumably, if they're got the product for free they somehow would have found a way to sell it all. Maybe they (the potential buyer) were just using the small company to force a price with a different supplier.
I'm not sure if one can tell if it's grift or not; it certainly seems immoral. Like going into a small restaurant, ordering loads of food and then saying "oh, I ate before I came out, I'm not hungry" and just leaving without paying.
I'm happy they were able to move their stock, but yeah. Something got signed with these terms in it. So you need to account for the possibility or have it renegotiated.
This sounds like the business equivalent of college advisors. They had an advisor who was probably well meaning but couldn't fully accommodate the young company because of ignorance/inability/whatever and now they're deep in a decision they never would have made.
$5-10k in a decent retainer would likely have prevented this.
I'm not convinced of well-meaning. I've seen this same scam happen with a different distributor in a different domain.
This is the classic "if you owe the bank $1000 you have a problem, if you owe the bank $1 billion the bank has a problem". And thanks to the net N terms + control of the end client, you're the bank.
