The 30-second advertisement below promoting Made in China products has been airing on CNN since late November 2009. The advertisement was produced under the auspices of four Chinese industrial chambers of commerce (China Advertising Association of Commerce; China Chamber of Commerce for Import and Export of Machinery and Electronic Products; China Chamber of Commerce for Import and Export of Light Industrial Products and Arts/Crafts; and China Chamber of Commerce for Import and Export of Textiles) and supported by the Ministry of Commerce of China.

This advertisement represents China’s first ever global branding campaign to enhance the image of the Made in China brand. The theme of the ad is Made in China, Made With the World. It attempts to highlight how Chinese and overseas firms work together to produce high-quality goods. Appearing in the ad are products used in daily life, including running shoes made with US sports technology, an iPod player with software from Silicon Valley, a French-designed fashion label and a European-designed refrigerator - all sporting the Made in China label. As such the ad is a clear attempt to link Made in China with Designed in the West and to illustrate China's capability and potential to manufacture quality products.

Before this advertisement, the global branding image of Made-in-China products was derived from individual companies such as Haier, Tsingtao, Huawei, or from Chinese companies investing capital overseas, such as Lenovo. The new theme of Made in China, made with the world, however, points to a whole new trend in the development of the Made-in-China brand. Yet this is only the start of the global reconfiguration of the Made-in-China brand. What do you think of the ad? Have a look and let us know in the comments section below. 

As all sourcing professionals will admit, finding the right supplier is the most important step for successful China production. But how can buyers evaluate the probability that a given factory will deliver acceptable products without delay? They should perform factory audits to approve each manufacturing facility.

Buying teams, or the quality assurance firms that represent them, can perform two kinds of factory audits:

• Audit to quality standards: overview of the factory (organisation, processes, capacity…) and study of its quality system
• Social audit: study of the factory’s labour policy and/or any other issue relevant to the client (i.e. the environment…).

This article focuses on the evaluation of the quality system. Auditors generally follow a standard checklist inspired by the requirements of the ISO 9000 series. The vast majority of Chinese factories—including many of the so-called 'ISO 9000 certified' ones—will fall short on at least a few checkpoints. Buyers who need acceptable products shipped on time will easily weed out the most unreliable manufacturers, which will fail on most points.

The checklist below is only a suggestion, and each buyer is encouraged to customise it to their needs. Take the time to apply it in several factories and you will have a clear picture of who you want to work with.

Part 1 of the checklist: What you should check as a priority

Understanding the buyer's requirements
Does the factory have a clear list of all desired characteristics of a product, before production starts?
Is it clearly specified how each characteristic should be measured?
Are conform samples available to workers in production and QC areas?

Suppliers of inputs
How does the factory evaluate and select material suppliers?
Do they communicate the requirements accurately to material suppliers?
Do they check whether a purchased product is up to specifications? How?
Do they send samples for lab tests? How often and for what tests?
Are materials properly stored?

In-house production
Does the factory give clear procedures to each worker and for each job (including the QC staff)?
How do they validate that each production process achieves the desired results?
Do they do in-process QC? On what proportion of products? What do they do with the data collected this way (corrective/preventive actions)? What happens to pieces found to be defective?
How do they ensure that measuring instruments are available and correctly used?
Do the operators control their own work?
Is there regular training?

Subcontracted production
Are materials delivered directly to subcontractors? How are they checked?
How does the factory control the work of the subcontractor(s)?
What do they check about the subcontractors' operations?

Final QC
What proportion of products is checked? How are they checked? Does it include packing?
Is there one last inspection based on AQL statistics? Based on what level of AQL?
What happens when non-conformities are detected?

Part 2 of the checklist: What you can check if you have some extra time

Accepting an order
How does the factory decide whether it can make a product and meet all the customer’s requirements?
And how do they validate a change in the product or the packaging asked by the customer?
Can they explain the process and the decision makers?
Can they give an example of a product they have recently refused to make?

Sampling
When the factory prepares some prototypes/samples, how does it make sure that the resulting product can meet all the customer’s requirements in bulk production?
Do they also make a prototype for the packaging at an early stage?
How are approved samples stored? Are they protected?

Instruments and machines
How does the factory determine what monitoring and measurements should be undertaken?
How do they ensure that measurement devices are calibrated and verified at specified intervals?
How often are production machines maintained and calibrated?

Prevention
Does the factory determine the root causes of non-conformities, and what actions do they take so that they don’t occur again?
Do they determine potential non-conformities and take preventive actions?

Note about supporting evidence:
For every checkpoint, the factory should present corresponding documents. You should be able to form an opinion by yourself, for example by counting the QC staff or observing some workers. Don’t just ask questions in a meeting room—go and check! Chinese factories are often tempted to say “yes we always do this, but we cannot show you records today because [reason XYZ]”. In 95% of cases, this is a lie and the records either don’t exist or are not kept properly.

The inability to present supporting elements in a timely manner, in itself, is not acceptable—make sure you mention it to them before the audit.

Note about the role of factory audits:
Being shown a nice workshop is not enough. Subcontracting is very, very common in China. Many suppliers are not transparent about this issue. Therefore importers are strongly advised to check where their orders are produced. They can send an employee or a third-party inspector to check the goods during production. Another advantage of this is that quality issues are noticed and corrective actions can be taken early.


Renaud Anjoran is the founder of Sofeast Quality Control, a third-party QC firm specializing in garments and textiles in China. He also writes on the Quality Inspection blog. You can contact him at info@sofeast.com. 

I recently accompanied clients to visit a few Chinese mining machinery suppliers. Conversing with these suppliers face to face helped me form a picture of the current work status of these companies, and afforded me a glance at the Chinese mining machinery industry generally. The following are some observations that made an distinct impression on me:

• Less busy

The worldwide financial crisis has inhibited cash flow on expansions and new projects in the mining industry. Almost all the companies I visited experienced order cancellations. Yet Chinese companies have learned to deal with cancelled orders with more a more logical strategy. They are working together with buyers to follow up and maintain good relationships. Nonetheless, these Chinese companies have much fewer orders compared with 2007 and early 2008. I saw 8-10 sets of equipment standing in the open area of one supplier’s factory waiting for collection. The supplier told me that at the same time last year, there was a great deal more equipment in the open area and the yard was full of finished products and trucks that came for collection.

• Innovation

Although the market is at the bottom, the suppliers are all very optimistic and spending more time on R&D. I attended ‘Australia Sino IronФ7.93m×13.6m Ball Mill Factory Test Run & Delivery Ceremony’ hosted by CITIC Heavy Industry. TheФ7.93m×13.6m ball mill is the largest mill manufactured in the world and totally developed and manufactured by CITIC HIC. The other private mining equipment company I visited said they have over 100 engineers working in their R&D department and develop on average 10 new products every year.

• Expanding overseas market

Although I know that the Chinese mining equipment industry is expanding its overseas markets, what I saw and felt during this visit was still very surprising. The companies I visited all have a large international business department with 20-30 people. The people receiving me generally spoke good English, were sensitive to western culture and have accumulated remarkable knowledge and experience in dealing with orders, negotiations and crises with overseas buyers. Some of them have started to actively approach overseas clients by searching on the Internet and sending emails directly, or attending exhibitions.

There is no doubt that the Chinese mining equipment industry still has a long way to go before their manufacturing capability and after-sale service can be recognized internationally, but this objective could be attained much sooner than when many international buyers assume, especially those who never come to China and see these factories for themselves.