Consolidating Small Orders in China before Shipment

A reader asked me an interesting question. I am reproducing a part of it, with all identifiers removed:

We are getting to the point where we are doing about a container each month where each container is a mixture of anywhere from 5 – 15 products from different factories across China. We have been talking about the feasibility of using a forwarder or a warehouse/multiple warehouses to have all the goods sent to first. Once we have enough products to fill a container, we’ll get it packed and send it off. The goal for this is to be able to confirm and enter into production more quicker and on a weekly basis. Currently, we source the goods, wait for each product to be confirmed and then purchase from all the factories at the same time.

I’m wondering if you have any ideas to streamline this process so we can get items produced faster and have a continuous flow of goods being manufactured and stored before shipment.

So the situation is this:

  • Most factories are roughly in the same area in China (mostly in/around Zhejiang)
  • Many SKUs are purchased from a number of suppliers
  • Most of the time, one supplier’s order cannot fill a container up, so consolidation is necessary

The way importers generally do is as follows:

  • They try to coordinate production completion times (but, as you know, this can be tricky)
  • Once the factories have completed enough products to fill a container, they ask each factory to deliver to the freight forwarder’s warehouse (by coordinating details directly with the freight forwarder).
  • The freight forwarder makes sure it all goes into the same container. Or arranges a LCL if the volume is small.

From a QC inspection perspective, here is what I observes:

  • Large companies that have high and regular volumes can rent a room in the forwarder’s warehouse and station an inspection team there. Since there is on travel and no supplier interference, results are known faster.
  • Smaller companies still need to send inspectors in the different factories (often on a randomized skip-lot plan). It is generally not realistic to bring the goods from several factories into one factory and check them there — the other factories will not accept to deliver before they get full payment, and the hosting factory will hate the idea of providing space and manpower for this.

I don’t know of any “easy” solution for this reader’s situation. Any tips?

Technical Data Files for China Production – part 15

I wrote before about the importance of writing a product specification sheet. It is the bare minimum every importer should document.

However, if you develop your own product and have it made in China, you should document additional technical data. And in some instances it is a requirement — for example all CE marking directives require the manufacturer of the product to create a technical file.

As the importer, you are considered the manufacturer. You have to be able to demonstrate with appropriately detailed documentation, calculations and drawings, how your product complies with all relevant directives, and so is safe during all phases of its life.

Technical_data_pack

What needs to be in a technical data file?

As a general guide, the following items should be included (this is based on an example for an electro-mechanical product):

  • Information concerning the products design assessment and construction, including information showing how relevant essential requirements have been met (which may include references to technical standards)
  • Copy of the Declaration of Conformity (and any other Declarations of Conformity or Incorporation relevant to the product or its subassemblies)
  • Description of the apparatus, usually accompanied by block diagram
  • Wiring and circuit diagrams
  • General Arrangement drawing
  • List of standards applied
  • Records of risk assessments and assessments to standards
  • Description of control approach
  • Datasheets for critical sub-assemblies
  • Part list (Bill of Materials)
  • Copies of any markings and labels
  • Copy of instructions (user, maintenance, installation)
  • Test reports
  • Quality control & commissioning procedures
  • Details of relevant research and test reports
  • Where a series of products are made, details of the quality systems to assure the safety of those products.

In the European Union, the technical file does not have to be permanently available in material form but should be made available in a reasonable period of time if authorities ask for it (sources: hse.gov.uk; conformance.co.uk).

Technical Drawings

From a technical drawing point of view, certain features should be included in your product drawings. Each component should have its own drawing with enough detail to allow the Chinese manufacturer to produce it. Each part should be dimensioned accordingly, important dimensions should have specific tolerances applied, and some of these tolerances may have geometric tolerances applied to them.

A percentage of dimensions that are critical to quality or critical to functionality should be marked up as ‘critical dimensions’ or ‘critical to quality’ (CTQ).

These critical dimensions will need to be monitored and tracked throughout the manufacturing process (if possible through Statistical Process Control — you can read how to use statistical tools to improve production processes for more information).

The UK Department of Trade and Industry has published an interesting ‘National measurement good practice guide’. Here is an excerpt from that guide:

The purpose of an engineering drawing is to show the requirements of the design function, with clear and relevant information so that the product can be manufactured and inspected to those requirements. The methods used in the design process should be clear and concise so as not to cause ambiguity in the interpretation of the design and this should in turn allow everyone involved in the process to interpret the design.

Safety and Regulation Requirements china – part 14

Many companies develop a new product but totally overlook the safety and regulatory requirements that will apply to that new product. We have pulled some information from different sources to give you an idea of what to look out for.

Safety_regulatory_requirements

Different countries have different regulations that must be met in order to sell a product within that country. Some other countries stipulate that getting your products certified is voluntary. Sometimes the rules and regulations on what you should ideally do and what you absolutely must do are very confusing. With this in mind, the following information is a guideline only and should not be taken as hard and fast rules.

I am not a qualified legal advisor, therefore I strongly suggest that you contact your local legal advisor and discuss with them what certification if any you need to get your product tested to.

To help you understand what the different marks that are applied to products after testing are, a list is shown below. (source: National Instruments.)

Please remember, this is just a guide to allow you to understand what the different symbols and logo mean and we recommend you contact your independent testing laboratory or local authority to understand what you would need to do in your local area.

Combined UL Mark for Europe, Canada and United States

UL

Products in compliance with UL’s Listing and Follow-Up Service for Canada and the United States as well as UL’s EU Mark service and factory inspection requirements for Europe are eligible to bear the combined UL Mark for Europe, Canada and the United States. This mark is a step toward addressing customer desire for a single certification mark for multiple key markets. The mark builds on UL’s combined UL certification Marks for Canada and the United States and is the first transcontinental mark in the UL portfolio.

The combined UL Mark for Europe, Canada and the United States generally includes the following:

  • UL in a circle symbol with “C,” “US” and “EU” identifiers
  • Word “Listed”
  • Alphanumeric control number
  • Manufacturer’s name or trademark
  • Model number
  • Product category name (product identifier) as indicated in the appropriate UL directory and UL-EU Mark certificate

When applicable, a combined UL Mark for Europe, Canada and the United States may only be applied as long as a product remains in compliance with all certification programs represented by the combined UL Mark.

Products found to be noncompliant with the terms, conditions or other UL requirements of any of the certification programs for Europe, Canada or the United States are not eligible to bear the combined UL Mark. However, these products can continue to bear individual UL Marks for specific certification programs as long as a product continues to comply with UL’s requirements.

FCC

FCC

The Federal Communications Commission (FCC) is an independent United States government agency. The FCC was established by the Communications Act of 1934 and is charged with regulating interstate and international communications by radio, television, wire, satellite and cable. The FCC’s jurisdiction covers the 50 states, the District of Columbia, and U.S. possessions.

All commercial electronic devices (unintentional radio-frequency radiators) sold in the United Sates are regulated by the Federal Communications Commission (FCC) if they are:

  • Employ clocks or oscillators
  • Operate at a frequency of greater than 9kHz, and
  • Use digital technologies

This includes almost every product that contains a microprocessor. If an unintentional radiator is not controlled through proper design using grounding and shielding, the result may be high levels of energy radiated or conducted from the equipment, causing unwanted effects on another device. Specific requirements have been set up by the FCC under Rules and Regulations, Title 47, Part 15 Subpart B. The FCC has broken down Part 15 into two categories, Class A and Class B.

Class A Device: A device marketed for use in an industrial or business environment and not intended for use in the home or residential area.

Class B Device: A device marketed for use in the home or a residential area. Examples of such devices include, but are not limited to, personal computers, calculators, printers, modems, many electronic games, and similar devices that are marketed to the general public.

It is ILLEGAL to sell or even advertise Class A or Class B products until their radiation and conducted emissions have been measured and proven to be in compliance with FCC regulations.

See the top ten reasons products fail testing here.

CE

CE

The CE-marking is the manufacturer’s statement to the EU authorities that his product complies with all relevant CE-marking Directives. It is important to emphasise that the CE-marking is not a quality mark or a guarantee to consumers in the EU.

The manufacturer is always responsible — within or outside EU — for CE-marking. If the manufacturer is not located in the EU, he can authorise a representative located in the EU who thus becomes responsible for CE-marking. The representative’s duties and responsibilities must be agreed in writing.

Importers not authorised by the manufacturer must keep his documentation in safekeeping in EU for ten years after the last production date. Bear in mind that the importer may always be held responsible for the documentation.

CE — The European Conformity (CE) — marking is affixed to products with input of 50 – 1,000 V AC or 75 – 1,500 V DC and/or for products which may cause or be affected by electromagnetic disturbance.

The CE marking symbolizes conformity of the product with the applicable Community requirements. CE is the manufacturer or suppliers’ self-declaration allowing products to circulate freely within the Community. NI products meet the essential requirements of Directives 2004/108/EC (EMC) and 2006/95/EC (product safety), and comply with the relevant standards. Standards for Measurement, Control and Laboratory Equipment include EN 61326 and EN 55011 for EMC, and EN 61010-1 for product safety.

C Tick – Australian EMC Compliance Declaration

C-Tick

To limit potential problems of electromagnetic interference (EMI), the Australian Communications Authority (ACA) introduced an EMC protection framework requiring EMC compliance for electronic products.

The C-Tick Mark along with the supplier’s registration number indicates that the product complies with Australian EMI standard AUS/NZ CISPR 11 and establishes a traceable link between the product and the manufacturer.

WEEE – Waste Electrical and Electronic Equipment Directives

WEEE

In 2003, the European Parliament passed the Waste Electrical and Electronic Equipment (WEEE) directives to encourage the reuse, recycling, and recovery of WEEE and to improve the environmental performance of all operators involved in the life cycle of electrical and electronic equipment, especially those dealing with WEEE.

Member states were required to adopt legislation by August 13, 2005. The regulations apply to all electrical and electronic equipment on the European Union market in that falls into any of 10 categories.

Additional information regarding what is required for RoHS – Restriction of the Use of Certain Hazardous Substances

ROhS

For reference, there is no longer a separate RoHS mark — it’s now part of the EN directives that requires CE marking.

The RoHS directive aims to restrict certain dangerous substances commonly used in electronic and electronic equipment. Any RoHS compliant component is tested for the presence of Lead (Pb), Cadmium (Cd), Mercury (Hg), Hexavalent chromium (Hex-Cr), Polybrominated biphenyls (PBB), and Polybrominated diphenyl ethers (PBDE).

For Cadmium and Hexavalent chromium, there must be less than 0.01% of the substance by weight at raw homogeneous materials level. For Lead, PBB, and PBDE, there must be no more than 0.1% of the material, when calculated by weight at raw homogeneous materials. Any RoHS compliant component must have 100 ppm or less of mercury and the mercury must not have been intentionally added to the component.

In the EU, some military and medical equipment are exempt from RoHS compliance.

Assembly Review after an Initial Product Build – Part 13

Once a first assembly job has been completed, it is time to review the results. It is not only a matter of checking quality and giving feedback to the Chinese factory.

Assembly_Review

First, what is an assembly line?

It is a manufacturing process in which interchangeable parts are added to a product in a sequential manner to create an end product. In most cases, a manufacturing assembly line is a semi-automated system through which a product moves. At each station along the line, some part of the production process takes place. The workers and machinery used to produce the item are stationary along the line and the product moves through the cycle, from start to finish.

The assembly review is an important activity within the overall review process. Two elements should be considered:

1.  Physical product assembly process and techniques from a design perspective

This review should highlight any problematic areas during the assembly process so that they can be listed within some sort of register, such as a risk register / improvement plan.

The review should include monitoring areas such as how parts or sub-assemblies are presented to the operators on the assembly line, how many times the operator needs to handle the part before passing onto the next station. Is the assembly in one direction or does the operator need to turn the assembly multiple times in order complete the tasks?

Other aspects to consider during the assembly review are workstation ergonomics and the ease with which the operators carry out the tasks required at each station, bearing in mind that some may require higher working surface levels than others.

The outcome of this review should be to identify all areas within the assembly that are problematic from a handling point of view, assembly point of view, how long it takes to assemble each particular element, etc. Once a list of all the issues has been identified, they need to be recorded in a process improvement plan. This way a resource can be assigned to generate a corrective action plan for each of the highlighted points.

2. Assembly line flow process review

This will depend on how the manufacturer is structured from a plant processing point of view. I wrote about the differences between the different levels of Chinese factories here.

The outcome of a production line review should be to identify smooth flowing areas and stations, as well as areas where there seems to be hold ups or looks as if there could be improvements made within the process, taking into account the ease of assembly throughout the flow.

The same principle applies with any areas that were identified as potential candidates for improvement — they should be recorded in a master document.

The second assembly review can also be reviewed with respect to lean production. You can write more on this topic here.

Initial Product Build – Part 12

Once a prototype has been tested, design iterations haven taken place, and tooling is ready (if applicable), it is time to test whether quality products can be made at the right speed in the Chinese factory you have selected.

As  you will see, the new product development process we advise follows somewhat the same logic as the AQPQ (Advanced Product Quality Planning Process) used in the car industry.

Initial_Product_Build

The Trial Production Run (TPR)

A trial production run takes place to establish whether the existing mass production process is capable of manufacturing your products to the required quality with the agreed production capacity, for a stipulated period, or of providing the relevant services.

The following criteria should apply with supporting data for each element as a result of the TPR:

  • all mass production equipment (e. g. installations, machinery, tools, inspection equipment) must be in operation
  • using mass production material
  • working to full capacity
  • using standard personnel
  • and all supporting systems

The TPR should be carried out with a batch size which represents the volume that would normally be run, or at least the target volume, for a full shift, eight to twelve hours for example.

One of the best methods of gathering data for analysis during the TPR is for a simple time and motion study. With engineers and production management reviewing each element of each station within the production process, data can be gathered that allows for improvements to be made. This process also provides the opportunity to identify where additional training needs to take place.

Reviewing the data

The TRP data should be reviewed and it should be the quality assurance engineer who leads these reviews, but should consist of a cross-functional team wherever possible. These critical, multiple-perspective reviews help ensure the final product built on the production line will meet quality requirements and your expectation.  This review is especially beneficial for lines that employ large amounts of manual labor due to the human-oriented quality of the controls (visual inspection).

Monitoring how each operator carries out their tasks and comparing the actions against the work instructions and at the same time monitoring the time it takes to complete each task should provide valuable data that can be used to adjust how operators function, improve work instructions, and increase the overall performance of the production process.

When to Implement TPR

There are clearly times when a trial production run is obviously required. When a new product is being made for the first time, however, there are other less obvious situations which call for a trial production run where product is produced and everything is monitored and data recorded for analysis and review.

Ideally, the following situations should trigger the TPR process:

  • New products being introduced onto a production line that has never built that product before.
  • Any major changes made to a current product, including sub-assemblies and critical component supplier changes.
  • Any material specification changes — these may be introduced as a cost down initiative; TPR is still required as this is a significant change.
  • Production of an existing product stopped for an extended period of time, greater than six months or more (during that time they may have been staff changes and product build knowledge lost).

Implementing a trial production run in a Chinese factory is of the upmost importance if you, as the buyer, don’t want bad surprises. This will give you all the data mentioned above for you to review, analyze and discuss with your supplier about the following topics:

  • Product improvements
  • Quality improvements
  • Potential areas for cost reduction
  • The reassurance that they can in fact produce your product to the required quality level

I have seen too many importers trust a Chinese manufacturer to make a complex new product right the first time. From experience, in 98% of cases it just doesn’t happen. There are always surprises — it is up to you to decide whether you want to find them out upfront or after you have wired a deposit and you have a shipping deadline.