I saw several people mentioning fake certificates recently in the context of Chinese manufacturing. While I know there are many fake product certificates, I don't think there are many fake ISO 9001 certifications, or those for ISO 14001, or ISO/TS16949 for that matter. My point of view is simple. There are many registrars, and many “consultants” that “guarantee a pass” and that know which registrars are very lax. It means factories simply pay and get the certification. It is not much more … [Read more...]
3 Types of Factory Evaluations for Purchasing in China
More and more importers discover that they can appoint an auditing agency to evaluate factories before they issue an order. But not all these evaluation services are equally helpful. I distinguish between 3 broad types of factory evaluations. Each type is suitable for different needs on the importer's side. 1. Basic Factory Evaluation The purpose is to collect basic information about the manufacturer, such as: What is the address? What do the buildings look like? How big is it? What … [Read more...]
How to reduce costs in a factory? The lean approach.
The number one challenge of Chinese suppliers is price, as revealed by a recent survey. Their costs keep rising, but price competition is stronger and stronger. Factory owners spend a lot of time trying to reduce costs. Unfortunately, they tend to focus only on three levers to keep their costs under control: Negotiating down material prices; Limiting salary raises; Pushing the employees to work hard, for long hours. These are actually NOT the main drivers of cost though... … [Read more...]
Auditing a small Chinese factory: does it make sense?
I see some well-meaning importers who pay for factory audits based on a checklist inspired by the ISO9001 standard. However, I am really questioning the value of auditing a small factory (below 400-600 workers). Don't get me wrong, I am not suggesting that purchasers roll the dice. They should try to visit the factories before placing orders. It is always good to see what equipment the factory will use, and what kind of products they are manufacturing. My point is that a formal audit will … [Read more...]