How to stay on top of your production in China

Sunchine Inspection, a professional one-stop international inspection provider, focus on providing more flexible and humanized inspection serviceto clients from all over the world.

Sunchine Inspection, Thinking for you and doing for you!

China Office

Room 2203, 22/F, Building 03, Zhongtai

International Plaza, 311, Middle Jiangdong

Road, 210019 - Nanjing - R.P.China

Tel: 0086-25-6809 3658

Fax: 0086-25- 8609 3678

E-mail: francois.shi@sunchineconsulting.com

Contact: Mr. Francois SHI

Managing Director in China Office

Mob: 0086-18951633559

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BY RENAUD ANJORAN

Many importers negotiate a shipment date (ETD) with their Chinese suppliers before orders are issued, and then fail to follow up on the production schedule.

I think they would avoid a lot of bad surprises if they asked for regular updates.

The danger of flying blind

Chinese suppliers know that asking for 3 weeks of delay is usually rejected. The purchaser might respond “if you ship that late, you’ll have to pay air freight”, or “in that case, the letter of credit won’t be valid anymore; the order is canceled”.

So what do savvy exporters do? They don’t reveal the situation clearly and in advance. They wait until 1 or 2 weeks before original ETD, and they announce a one-week delay “because the materials arrived late”. Then another 5 days “because of power shortages”. Then another 5 days “because we don’t have enough workers”. And so on, until production is three weeks behind schedule.

This process can be devastating for an importer who promised a delivery date to his domestic customers, and who has to postpone it again and again.

How to avoid discovering delays at the last minute?

Before issuing an order, you should ask for a few milestones. Here is a list that is probably too long:

• Arrival of all materials/components (and, if relevant, inspection of these inputs)
• Start of bulk production
• Sending of production samples
• 20% of order is finished (and, if relevant, in-process inspection)
• 50% of order is finished
• 100% of order is packed (and, if relevant, final inspection)
• Ex-factory date (at least 2 days after final inspection)
• Shipment date (ETD)

Then, when you reach each milestone, you can ask your supplier whether it was achieved. If not, they should update all remaining dates.

Sending someone in the factory (e.g. your purchaser, an inspector…) is a good solution to check the production status. At the same time, you can verify product quality.

Can you afford to do this?

If you really need to stay on top of production, you should do as described above.

But you need to find the right balance.

If you place orders with many suppliers, you might not have time to follow all these dates. And if your orders are not very large, you might not want to bother your suppliers with so many updates.

In such cases, you can reduce the number of milestones.

For example, you can track these dates: start of production, 20% of order completed, 100% of order packed, and shipment date.

The most important is to keep some visibility over the production schedule.

Maybe some readers can share their experiences?

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Article Source: qualityinspection

pipe inspection

Sunchine Inspection, a professional one-stop international inspection provider, focus on providing more flexible and humanized inspection serviceto clients from all over the world.

Sunchine Inspection, Thinking for you and doing for you!

China Office

Room 2203, 22/F, Building 03, Zhongtai

International Plaza, 311, Middle Jiangdong

Road, 210019 - Nanjing - R.P.China

Tel: 0086-25-6809 3658

Fax: 0086-25- 8609 3678

E-mail: francois.shi@sunchineconsulting.com

Contact: Mr. Francois SHI

Managing Director in China Office

Mob: 0086-18951633559

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BY RENAUD ANJORAN

Here are some interesting or useful articles that I found recently.

In China, the Dangers of Due Diligence

Checking Chinese suppliers or partners carefully before starting a business relationship is extremely important.

Yet China is making it pretty clear that background checks on companies or individuals (without their consent) are not welcome. They are, in many cases, illegal!

Fast and Flawed Inspections of Factories Abroad

Another interesting article from the New York Times, about the difficulty of auditors to find the real in factories.

The inspections are often so superficial that they omit the most fundamental workplace safeguards like fire escapes. And even when inspectors are tough, factory managers find ways to trick them and hide serious violations, like child labor or locked exit doors. Dangerous conditions cited in the audits frequently take months to correct, often with little enforcement or follow-through to guarantee compliance.

And what is the root cause? First, the type of audits:

Dara O’Rourke, a global supply chain expert at the University of California, Berkeley, said little had improved in 20 years of factory monitoring, especially with increased use of the cheaper “check the box” inspections at thousands of factories.

And second, the bad habit of subcontracting the work:

Unauthorized subcontracting, or farming work out, to an unapproved factory (as was the case for the Quaker Pet Group order in China), is very common.

So what is the solution, according to experts?

You can never visit facilities often enough to make sure they stay compliant — you’ll never have enough inspectors to do that. What really keeps factories compliant is when workers have a voice and they can speak out when something isn’t right.

The Problem With Auditing Factories in China 

Andrew Reich doesn’t seem to agree with the above article.

Retailers, brands and importers are more concerned with CYA (covering their asses) then in making real improvements and protecting workers. This is the ROOT of the problem, and we all know if your root is rotten you ain’t going to grow a very nice tree.

He goes on to describe the perverse incentives that social compliance audits have created in the supply chain.

Insist on a Bank Account When Paying a First Sample Charge 

Callum Makkai gives two GREAT tips to improve the supplier verification process:

• If you need to pay for the initial sample charge, insist to wire money on their company bank account. If they can’t give you that information, they are probably not a serious supplier.
• If you need to pay the courier fee for sending the samples, don’t just give your account number to the supplier — instead, ask your courier to pick the samples up. This way, you know the supplier’s address, and you can compare it to the address on the business registration.

How to Stay Organized While Sourcing

Liz Long gives small buyers a few tips on how to organize their China sourcing activity.

Here are a few of her suggestions:

• Keep all contacts in Excel, with comments etc.;
• Set up the quoting process so that you compare apples to apples;
• Using a CRM software to keep track of all interactions with suppliers.

3 tips for your China price requests

Etienne Charlier gives us three tips on how to request quotations from Chinese suppliers, based on actual examples.

The naughty vendor checklist

Stephen Ashcroft, a “purchasing and proposals coach”, came up with a list of behaviors observed in suppliers who tried to take advantage of the buyer.

Here are a few good ones:

• Shift responsibility to sub-contractors to avoid accountability.
• Blame pressure put on price by the buyer at the time of contract for performance shortfalls, and then try to renegotiate the price.
• Escalate minor difficulties to prevent them being raised in the future.
• Exaggerate costs of variations and changes to enhance profit.

Article Source: qualityinspection