No Chance for Bribery! An Example of a Recent Scam

Ensuring quality in your supply chain goes beyond inspections and testing, and often include many other necessary services. For example, loading supervision. A recent example underscores the importance of including this in your quality planning.

 

Our inspector arrived at the loading area to perform loading supervision. A key element of the service is a comprehensive inspection and assessment of the container. In this case, the container was found to have damage and a bad smell. Further investigation uncovered the fact it has been previously used for frozen seafood shipments. Our inspector contacted logistics company and his manager to report the issue. The logistics company sent some employees to resolve the issue. They used glass glue to seal the damages, and sprayed air freshener to cover the smell. However, our inspector did not believe these methods they used cannot solve the problems. An executive with the logistics company tried to bribe the inspector to accept the container so the goods could be loaded. HQTS inspector refused the bribe and explained the company’s code of conduct.

 

Upon informing the client of the situation, the loading order was cancelled, and the logistics company was forced to provide a replacement container. Our client was very pleased with the professionalism of our inspector.

 

See here how a loading supervision works:

container loading inspection

A New Perspective for “Made in China” Products

Products bearing the “Made in China” label have long been considered as goods of questionable quality. When China reformed, opening for business to the world, it quickly became a global leader in manufacturing. This was due to a cheap labor force and access to raw materials.

made in china

However, substandard manufacturing processes made it difficult to produce refined products of high quality. With the accumulation of decades of experience in manufacturing, processing, supply chain management, and increasing demands for quality improvement from domestic and international consumers, China has greatly improved its manufacturing capabilities. This demand has resulted in the emergence of both high-end manufacturers and third-party quality assurance providers, with a focus on inspections, supplier evaluation, and testing.

Certified quality control providers in China must strictly comply with the requirements of the ISO17025 management system, which is recognized by the China National Accreditation Service for Conformity Assessment (CNAS), a member of the International Laboratory Accreditation Cooperation (ILAC). Testing and inspection results issued by certified QC providers are recognized internationally. For example, testing lab results are periodically compared with the results from international labs to ensure they comply with ISO17025 requirements.

Understanding the state of the quality control inspection and testing industry is also key to understanding the shift in perception of “Made in China” products.

For example, clothing and textile products. Because they are close-contact articles, standards governing their manufacture have been implemented by quality assurance bodies around the world. Among the most well-known are the U.S. AATCC and ASTM, ISO, Australia AS, British BS, EU EN, Japan JIS and China GB. The testing standards tend to be similar, and primarily cover issues related to component materials, tensile strength, shrinkage, color fastness, hazardous substances, flammability, etc. However, the standards and requirements may differ considerably by retailer, importer, country and region; leading to varying degrees of product quality.global markets Therefore, the quality of “Made in China” products increasingly depends on market requirements, rather than a preconceived notion.

China manufacturers are now able to manufacture products across the all levels of the value chain, from high quality products at a higher cost, to mid-range and cheap inferior products at lower costs. This is a marked change from the past when limitations in technical and quality competencies in China resulted in a reputation for producing inferior products at low cost.

From the standpoint of buyers, importers and exporters, regions and governments, retailers and consumers, requirements for safety, environmental protection, appearance, function, etc. also vary considerably, thus impacting product quality. Different manufacturing and supply chain models are developed to support these requirements, which are then conveyed to Chinese manufacturers. The manufacturers carry out production and quality management as per the requirements to ensure satisfaction of the customer, receipt of payment, complaint and product recall mitigation, and sustainable development. Manufacturers with the best success in satisfying buyers outside of China are usually the enterprises with suitable scale and technical strength, and who can guarantee the level of product quality. To do so, they must be familiar with, and capable of managing, product quality demands across a broad spectrum of requirements.

Therefore, top manufacturers understand the importance of product inspection and testing from material selection through manufacturing. Proper application of quality processes and techniques helps to avoid reworking of finished products, refusal of entry at port, or recall after the products are sold on market. A qualified product inspection and testing report is quite important for guaranteeing the product quality and for increasing the trust among parties.

 

inspection report

How do inspection and testing providers guarantee the accuracy of inspection and testing reports and the quality of products made in China?

If an inspection or testing provider finds that a product does not comply with relevant criteria, details and proof of non-compliance are clearly recorded in the final report. Providers should not make any false statements or provide inaccurate information for any non-compliance discovered in products during the quality control process. While there are some exceptions, the quality control provider should generally not be viewed as an advocate for the buyer or seller, but rather as an independent, objective third party. As such, it maintains its own integrity, neutrality, and objectivity while providing reliable quality control reports; allowing it to preserve a professional reputation and sustainable business development.

A provider that violates these standards may come to the attention of the relevant regulatory bodies, by means of a complaint. In this case, an investigation is triggered, and any providers found to be repeat violators of prohibited acts would be barred from working in the industry. CNAS certified providers must report their findings of compliance or non-compliance truthfully and accurately; it comes down to their very survival in the industry.

This underscores the importance of engaging only with a CNAS, or other accreditation body, certified quality control provider. It ensures the integrity of the quality control standards and compliance with customer requirements. This helps to avoid compromising situations as suppliers who seek approval based on a single high-quality sample, bribery, and other games they play to circumvent the requirements.

Another factor in changing the perception of “Made in China” products is the growth of the OEM industry in China, the products of which are typically of very high quality. These include products being manufactured for Apple, Armani, GUCCI, and most other well-known brands.

ecommerce

With the rise of internet and ecommerce in China, as well as improvement in manufacturing processes and technologies, some Chinese enterprises have transformed themselves into design and manufacturing powerhouses. This is also changing the view of “Made in China”. These companies are building globally recognized brands such as HUAWEI, XIAOMI, and many others, and are poised to capture significant global market share in their categories.

These developments fully demonstrate that China manufacturing, supply chain, and quality support capabilities are accelerating quickly, and that China manufacturing no longer represents inferior products of low quality. Taken together, these support a new perspective for products “Made in China”.

made in china

Quality Control – DIY or Call in the Experts?

Will in-house quality control, or a third-party quality control provider, best help me achieve my quality goals? Which approach makes the most sense from a budget perspective? Can I affectively do both? How can I trust someone to know my product as well as I do? How can I control ethics and bribery?

The answer to these questions are clearly different for different organizations, and situations. This article will merely provide you with some considerations – advantages and disadvantages – that may help you in your decisioning process.

Personal Experience

I ran a sourcing business for nearly 10 years. In that time, I dealt with a myriad of quality and vendor issues. Some of these included: wrong product colors, wrong sizing, tools that bent or broke easily, substandard shoe leather, flimsy packaging, poorly loaded containers, horrendous factory conditions, and child labor.

In-house quality control vs. third-party quality control inspections

These are only a few of the many quality related problems I faced. In a few cases, just in time delivery of containers full of defective products had a significant negative impact on my business. I learned that a solid QC plan was necessary to keep my customers happy and business profitable.

In fact, I found a mix of in-house quality control and third-party inspections to be right in my case. My situation was different from many, in that my in-house inspectors wore many hats, not just as quality control inspectors. So, justifying the cost was easy for me.

I Know My Product Better Than Anyone!

You should! But, do you know all relevant import regulations? How about testing requirements, recall issues, and AQL inspection standards? Do you know all the tricks suppliers play to offer the best price against an awesome sample, while delivering a substandard product? Do you know how to best avoid production delays? Can you match the quality technical and industry knowledge of third-party quality control providers? Can you really trust test results from your supplier?

In many cases, the answer will be NO! Your business is to develop, manufacture and sell products. Sometimes it is best to leave quality control to the experts.

Cost

Consider the facts. Where pure cost is an issue, a third- party quality control provider is almost always the best option. Why? For example, it is seldom cheaper for someone to travel to Asia to do inspections than using a third-party inspection company.

If your company is large enough to staff in-house quality control in Asia, it can be workable, but the commitment and cost is still significant. Even in this case, there are times when it will be more cost effective, or technically wise, to bring in a third-party quality control provider.

In-house quality control vs. third-party quality control inspections

Scalability

Do you work with a single supplier or a few in the same city? Is your production infrequent? Doing your inspections with in-house staff might make sense. For many, however, production frequency and volume changes with the seasons and product types. Factories are in disparate locations. You might have a limited ability to scale staff to those needs. A third-party inspection provider gives you flexibility in achieving staffing, seasonable, and multi-location requirements.

Antibribery

Some assume this risk increases with third-party quality control providers. However, the risk of corruption must be factored into your in-house quality control model as well. In-house quality control departments are constantly dealing with this issue, because it often comes down to the local inspector, regardless of who they are working for. The key is a practical antibribery policy and how the policy is carried out.

In-house quality control vs. third-party quality control inspections

Of course, you can do this yourself. But the advantage of an accredited third-party quality control provider is unmistakable. A reputable provider will not only have an ethics policy and anti-bribery program in place, they can prove the results with data. It is simple for any company to say, “yes we have an anti-bribery policy”, or “all our inspectors are ethical”. This makes it vital to request documentation that proves how the program works.

Technical Expertise

Since nobody knows your product as well you, you may have a case for training in-house quality control inspectors. But, if you import wide range of products, a third-party inspection can provide expertise, and industry insight, you may not have. We are up-to-date with the latest trends, technology, and regulations. We also have deep experience and technical insight for a wide range of products. In addition, a good QC company will also be happy to accept whatever product training you want to provide.

Conclusions: Third-Party vs. In-House Quality Control

I have learned the hard way – a good quality control plan must be in place. In many cases I found the third-party inspections to be much quicker, more flexible and cost effective. Third-party quality control providers were more skilled at technical and social audits, which helped build value in my sales to retailers. They also helped me keep my in-house QC staff honest by means of unannounced inspector audits.

In-house quality control vs. third-party quality control inspections

A third-party quality control company also did all my testing. I learned to never to blindly trust self-testing by a supplier, or from their chosen labs. They tend to use their own equipment with dubious calibration record, or local testing labs that are not certified. So, the results were always suspect. If you do trust them, double check with a certified testing company from time to time. The supplier is usually not the one hurt by a recall or lawsuit, you are.

Even if you have the resources for in-house quality control in Asia, there will be times when third-party inspection services make total sense. Whether it be quality control inspections, factory audits, social compliance, supplier evaluations, consumer goods testing, or other quality assurance requirements, there will be a circumstance where third-party services can be a huge help.

Whatever you decide, remember, it’s your money and brand on the line.

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In-house quality control vs. third-party quality control inspections

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