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Are Calibration Reports Always A Must? Why Auditors Should Think Before Raising Suppliers’ Costs

By Annie Chan Did you get a visit from an auditor who seemed obsessed with calibration reports? Was he/she happy to see that all tools had been calibrated based on internal reports, or (even better) on third-party lab certificates? There is no doubt auditors love asking for all kinds of reports to confirm the supplier complies with requirements. However, their requests are not always reasonable. … [Read more...]

Manufacturing Electronics in Taiwan: A China Alternative?

As the US-China trade war intensifies, many American importers are looking for alternatives. They often look at Vietnam, Thailand, Indonesia, India, Mexico, etc. But what about Taiwan? There is sometimes an opportunity to start sourcing products from there, especially in electronics. … [Read more...]

Will US Tariffs Drive Manufacturing From China To Vietnam?

A few days ago, Trump claimed that many tariffed companies would leave China for Vietnam and other such countries in Asia in this  series of tweets (read from bottom to top): In parallel, I see an Asia Briefing article entitled Why Vietnam is Overtaking China as a Destination for US Export Manufacturing, showing that this trend is already underway: Vietnam’s exports to the US rose by 28.8 percent year on year in the first quarter of 2019, making the US the largest importer of Vietnamese … [Read more...]

Traceability in Manufacturing: Do your Chinese Suppliers Do it Right?

I see buyers who spend a lot of time pushing their suppliers to do QC inspections on incoming components, to keep the production area clean, to give clear instructions to operators, and other basics. But I seldom hear them push for traceability in manufacturing, despite how important it is. I thought I should write about it again.   … [Read more...]

9 Consequences of the Upcoming US-China Trade War

Based on all the articles I have read about the current geopolitical situation, I am not optimistic about the affect of the US-China trade war on American importers. Dan Harris, who wrote "the US-China Cold War start now," announced that a "mega-storm" might be coming, and he may be right. Now, if things turn out as bad as predicted, and if tariffs apply on more goods imported from China to the US -- and at higher rates -- what does it mean for US importers? … [Read more...]

How To Ensure your Chinese Factory Purchases Good Components?

One of the most common ways Chinese manufacturers enlarge their margin is buying substandard components. Any time a lot of money can be saved this way, the temptation is very strong. What can you do to avoid this risky behaviour from happening? … [Read more...]

100% Inspection in a Third Party Facility in China: The How-To

I am guessing that about 96% of quality inspections done in China, on behalf of overseas buyers, are conducted in the supplier's facility on a set of randomly-picked samples. About 3% are done at the supplier's facility, on 100% of the pieces (typically, high-value items). And maybe 1% is done in a facility controlled by the buyer or a service provider engaged by the buyer. And it makes sense. In most cases, a random inspection (or a series of such inspections along the manufacturing cycle) … [Read more...]

Why Your Ground Agent in China is NOT Helping Cut Costs

From time to time, I hear from a company that works with a ground agent in China, and they basically tell me two things: The agent did a relatively good job lining up suppliers, communicating requirements, and generally ironing out most issues. (That makes sense -- otherwise, the importer switches to another agent or to another approach.) After the initial burst, the agent feels entitled to a commission of X% and is resting on her laurels, not challenging factories, not looking for new … [Read more...]