China Product Manufacturing: You Want Quality With That?

China NNN Agreements

In Why you Need a Backup Factory for your China Production, Renaud Anjoran notes how a Chinese factory’s “communication and development skills do NOT correlate with good manufacturing skills” and how so many “bad product” situations involve the following:

  • The buyer does no inspection in the factory before shipment.
  • The factory sends a few well-chosen samples taken out of production, which reassures the buyer.
  • Upon arrival, the buyer finds most products are defective.
  • All the supplier offers is a discount on the next order, as well as profuse apologies (or excuses).
  • The second shipment is bad too (there is an 80% chance the second shipment will be no better than the first).

I agree with all of the above but I would put the chance of getting a bad second shipment at greater than 80%. The above sort of situation virtually always results from the product buyer failing to do any or enough of the following:

  • Due diligence on the China manufacturing company.
  • Due diligence on the China manufacturing facility.
  • Requiring the China manufacturing company to sign an enforceable China Manufacturing Agreement.
  • Having an inspector check product quality before anything ships.

What do you do to ensure good product?

4 responses to “China Product Manufacturing: You Want Quality With That?”

  1. Here’s another step that usually works very well. Put highly knowledgable manufacturing people side by side with their Chinese counterparts in the supplier’s factory. Show them, train them how to make the product correctly. Take steps with the supplier to develop a training program so that knowledge passes on effectively to new employees. Put a highly knowledgable inspector or quality engineer side by side with his/her counterpart(s) in the supplier’s factory. Show them how to inspect and record observations, and even how to fix problems.
    Three aspects of Chinese culture help to enable this approach. First, Chinese employees at all levels are often hungry for training and knowledge, and are highly motivated to learn. Second, Chinese employees, managers, and those in leadership positions will often go to great lengths to avoid a loss of face to which defects contribute. Third, offer a performance bonus for improving quality based on the assessments made by off-site inspectors employed by the customer. Research shows that people of Asian cultures are highly motivated by money. Why off-site? So the inspectors cannot be influenced or threatened by the supplier’s employees.
    Is this expensive? Yes, but taking these measures can often be less expensive than dealing with the fallout from receiving defective product. In addition, making this investment in a Chinese supplier goes a long way towards building lasting and constructive relationships with the supplier.

  2. One point to add on inspections; it is too late once they are ready to ship. At best you will lose your deposit. In order to make sure that you get what you order you need a person in the factory, if not full time, at least several times for critical checks. For example checks on material quality before manufacturing starts. If checks are done throughout the processing then it is far less likely that you will have a major surprise at the end.

    • Unfortunatelly, many China companies requires a lot of pre – work before the order is made. Does the company really exist? Does the company have a reasonable financial situation? Does the company is able to produce what you are asking for with the quality and quantity that you need? Are we on the right moment to place order (never before Chinese new year!)? After placing the order, you will also need to follow up (in person) to make sure they will produce according to the specification (It is very, very difficult to re inforce contracts in China, for most of the suppliers. Right before shipment, you will also need to check the produtc (thorugh sampling , or 100%). So, dealing with Chinese suppliers requires experience and time. We have been dealing with China for more than 15 years, is getting better in some aspects, but still the same way-of-work.

  3. Another option is to use the services of a North American contract manufacturer with a Chinese supply chain that has a quality control program in place with guarantees to stand behind the product and assume the risk of defective product or production delays. You save the frustration and cost of your staff dealing with an offshore supplier and still receive a quality product at a compelling price. At our company fighting for quality is a full-time commitment. Having the right vendors (knowing how to motivate them), understanding the culture and language, experts in supply chain management and logistics and knowledge of the manufacturing processes and ways to add value. This is collaborative not a transactional.

Leave a Reply

Your email address will not be published. Required fields are marked *