The competition in the quality control industry

Quality Control CompetitionWhen I am on a trade show in Hong Kong and I speak to random purchasers, I am always amazed. Amazed by the number of people who don’t know that they should do quality control on their shipments.

They are generally beginners, or they only import a few containers of year. But one shipment of unsellable junk can sink their business.

I was thinking about it, and I created the pie chart that you see on the right. I made up the proportions, but I feel they are not far from the truth.

The takeaway for me is that the market is very large and there is space for all third-party inspection agencies.┬áRather than trying to get clients away from competitors, we should educate the buyers. It would tap into the dark blue part (“do not know about inspection firms”) and into the red part (“decide not to do QC inspections”).

The share of professional QC firms is growing anyway, as more buyers cut the trading companies (the green part in the chart) and buy directly from manufacturers.

Another trend I am forecasting is the rise of the light blue part (“pay for customized project management“). It includes the buyers working with sophisticated sourcing agents, with supply-chain specialists, or with highly specialized quality assurance firms.

The market is large and new opportunities appear every day…

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Comments

  1. says

    Good Pie chart.

    100% agree with you on “we should educate the buyer”, in our company (in the past one year) we got more number of buyers who used first time a 3rd party for quality control.

  2. Renaud Anjoran says

    Sarath,
    Thanks for your comment. You are right, many importers are not familiar enough with quality control.

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