The time that a buyer spends at a plant is crucially important. The main goal of taking a plant tour is to observe and judge the plant. So, taking full advantage of this visit comes down to a few very important considerations: What aspects should you pay particular attention to during the trip? and What questions should be asked in addition to inquiries about the product itself?

Here I want to share some tips based on my personal experience.

• The boss/decision maker of the plant
  
  In general, the boss/decision maker’s attitude or working style is conveyed to his/her subordinates, and hence it will affect the efficiency of the whole production/delivery procedure. So if you find the boss is unprofessional or uncooperative from the very beginning, you should think twice about your choice of supplier.
  


• The equipment of the plant
  
  The equipment can normally give a clear impression of the abilities of the plant. We are not necessarily saying the equipment has to be imported equipment; rather, we try to understand if the given equipment can deliver the ideal product. Asking the plant for the equipment list and maintenance status will be a smart test.
  
  
• The production procedure and quality control
  
  Asking the plant if they have proper production procedures/quality control systems is very important. That helps us to understand if there is a systematic way to audit the whole process of implementing our order and insuring the right product is delivered on time. Normally, our questions would be along the following lines:

1. Does the factory have daily production reports?
2. Does it keep a weekly production progress report to identify and compare in-process and completed orders with order delivery dates?
3. Does the factory have a written QA procedures or manuals?
4. Does the factory complete its own final audits?
5. Does the factory have documentation inspection standards?
6. What percentage of received raw materials is inspected?
7. Is there an inspection process between each production section?
   

Of course, the questions above are only part of what should make up the most frequently asked questions, and these are also subject to each buyer's individual needs during the visit. Yet they can be used as a basic guideline of what needs to be asked. 

• The working environment of the plant
  

People sometimes tend to neglect the working environment of the plant. But this is actually an important indicator of the quality of the plant and of some aspects that will affect the quality of the product, such as cleanliness and tidiness of the production areas, and adequate lighting in the factory, especially in areas that will affect the quality of the product (inspection, hand operations, painting, silk screening, printing, packing, testing, etc.), etc.

Generally speaking, many aspects affect and can reflect the quality or the standard of the plant. Different products, different amounts of an order can sometimes also make different requirements of the plant. The visitor should prepare the necessary questions beforehand, and not merely ask random questions during the visit.

This is the last article of this series. After introducing the inspection levels, the AQL, and the types of QC inspections, I am going to put it all together by walking you through several examples.

Example 1: 5,000 widgets from a new supplier
You have no information about the factory, so you should adopt the normal level (a.k.a. level II). The order quantity is comprised between 3,201 and 10,000pcs. If you open the first AQL table, you see the code letter is L. (If you forgot how to read the tables, see the article about AQL tables). And with the second AQL table you see that 200 samples have to be checked by the inspector. If you opt for the standard AQL limits (0 C. / 2.5% M. / 4.0% m.), the inspection is failed if at least one of these conditions comes true:

• One or more critical defects are found
• Eight or more major defects are found
• Eleven or more minor defects are found

And let’s say you want the inspector to check all the product functions on a few samples. This test takes some time. You can choose special level S-2. You see this test will be done on 8 samples (by opening again the first AQL table and then the second AQL table). The 200 samples can be checked by one person in one day, so a third-party QC firm would quote you one man-day.

When to inspect? If this is a standard product and you have flexibility with timing, a final (pre-shipment) inspection should be enough.

Example 2: 30,000 watches from unknown supplier(s)
You suspect that your supplier gave orders to several workshops to produce your goods, but he won’t tell you. And these items are rather valuable. A level-III inspection is probably the most appropriate.

If we read the AQL tables as we did above, we have to inspect 500 samples, and the maximum number of defects is: 0 critical, 18 major, 18 minor.

If a visual check on all samples and a function/accuracy check on a few pieces is enough, it probably takes two or three man-days.

When to inspect? If the supplier refuses to disclose the factory information, you have to go for a final (pre-shipment) inspection.

Example 3: Four different styles of garments from a good factory
You know that this factory’s workmanship is quite good. But you want an inspector to check all the conformity elements, and in particular the measurements. Level I should be enough. You sell these products in boutiques at a high price, so you can only accept 1.5% major defects and 4.0% minor defects (for garments, there are generally no critical defects). The fitting is quite important, especially for the brassiere and the brief, so 3 to 5 samples should be measured in each size. There are 4 different types of products, so there has to be 4 inspections:

Product	Order Qty (in pcs)	Code letter (level 1)	No. of samples to check	Max. No. of defects	No. of samples to measure
Nightdress	1,000	G	13	1M, 2m	3 sizes x 3 pieces
Camisole	3,500	J	32	2M, 5m	3 sizes x 3 pieces
Brassiere	6,000	J	32	2M, 5m	6 sizes x 5 pieces
Brief	11,000	K	50	3M, 6m	3 sizes x 5 pieces
TOTAL	21,500	-	127	-	63

The total number of samples to check is only 127 pieces. But this order cannot be checked in one man-day, for two reasons:

• There are four different inspections to carry out. For each product, the inspector has to check all the conformity elements (fabrics, colors, accessories, stitchings...). And there are four reports to prepare.
• There are 63 samples to measure, across four different products and many sizes.
  

So it will probably take 2 inspectors for one day, and maybe 3 (depending on the products complexity).

When to inspect? The best is clearly during production, when the products are on the line. As the 4 products might not all be processed at exactly the same time, it might be preferable to send an inspector at different times. And if an inspection is failed, a re-inspection can probably be performed at the supplier’s charge.

Now what about you? Tell us briefly about your case in the comments section, and I’ll give you some advice.

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

The first two articles of these series focused on the different inspection levels and on the AQL tables. So you know how to set the number of samples to check and how many defects have to be accepted. With these settings and your detailed product specifications, a QC inspector can check your products and reach a conclusion (passed or failed).

But importers face one more question: when should the products be inspected? This is an extremely important issue for buyers willing to secure their supply chain. Spending a few hundreds of dollars to check and fix issues early can be an excellent investment; if might save you weeks of delay, shipments by air, and/or lower quality products that you have to accept and deliver to your own customers.

Four types of inspections

Let’s picture the simplified model where one factory turns raw materials into finished products. (If you also have to manage the quality of sub-suppliers’ products, the same model can be applied to them).

Pre-production inspection

This type of inspection is necessary if you want to check the raw materials or components that will be used in production. Buying cheaper materials can increase a factory’s margin considerably, so you should keep an eye on this risk. A pre-production inspection might also be a good idea if you suspect that technicians on the factory floor have not been given all the information or have not understood all your requirements. How to make sure of this? By sending an inspector when the very first products are in process (under bulk production conditions). If you need to help the factory improve its processes, this is also the right time. But you will need to either send your own technicians, or find a highly specialized QC/engineering firm.

During production inspection

How to get a good idea of the average product quality, and be able to ask for corrections if problems are found? Send an inspector during production! It can take place as soon as the first finished products get off the line, but these samples might not be representative of the whole order. So usually such an inspection is done after 10-30% of the products are finished. What are the main benefits of an inspection at this stage?   

• Be aware of quality issues early, and implement corrective actions before it is too late
  
• Communicate with your supplier about what is acceptable and what is not
  
• Get a precise production schedule

 

Final (pre-shipment) inspection

Inspecting the goods after they are made and packed is the standard QC solution of most importers. The inspector can really check every detail, including counting the total quantity and confirming the packaging. Final inspections are usually performed in a hurry, just before shipment. To avoid creating delays, inspectors can usually start after 80%+ of the order quantity is packed. Final inspections are appropriate if the factory delivered good quality on the exact same product in the past. Otherwise, buyers are strongly advised to have the products checked earlier.

The downside of final inspections is that inspectors adopt a “policeman attitude”. Factories hate the risk of last-minute rejection, after all the goods are made (and might not be repairable). Buyers have the upper hand and can often ask for discounts and threaten to refuse the goods. This is a major cause for the corruption of QC inspectors. Most Chinese manufacturers are not organized to keep their processes under control, and they often discover the issues after an inspector shows them defective samples. Helping them with pre-production or during-production inspections usually makes more sense.

Container-loading supervision

In some cases, a buyer wants to make sure the factory ships the right products, in the right quantity, and with the right loading plan. This supervision can take place immediately after a final inspection (in which case the same inspector does the job). But usually it is a separate service that consists of two steps:

• Counting the whole quantity, opening a few cartons and doing a quick check on the products, and checking all the packaging details

• Supervising the loading of the cartons in the container or the truck

 
The importance of detailed specifications

1. Most quality issues come from miscommunication and misunderstanding. Importers should keep track of all their requirements regarding the product and its packaging. When a good deal of customization is involved, and for large orders, these specifications should be translated in Chinese (for the factory technicians) and included in a contract. When the time comes for product checking, the inspector will use this information as a checklist
   
2. After an inspection fails, the supplier usually agrees to repair the problems and support the cost of the re-inspection. Detailed specifications are useful in avoiding endless negotiations with your supplier
   

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

In the last article, we explained the different inspection levels that can be used. Another basic concept rings familiar to many importers, but is often not clearly understood: the AQL (Acceptance Quality Limit).

There is no such thing as zero defect

First, as a buyer, you have to know what proportion of defects is tolerated on your market. If you are in the aviation business, any defective part might cause a disaster, so your tolerance will be very, very low. But you will have to accept a higher percentage of defects if you source consumer products made by hand in China.

An objective limit is necessary

So, how many defects are too many? It is up to you, as a buyer, to make this decision. There are two reasons why you should not leave this to the inspector’s judgment: 

1.  When it comes to giving instructions to an inspector, you should never leave gray areas—as they might open the door to corruption.
2. Your supplier should have clear criteria for acceptability, or they will see rejections as unfair. The AQL is the proportion of defects allowed by the buyer. It should be communicated to the supplier in advance.
   

The three categories of defects

Some defects are much worse than others. Three categories are typically distinguished:

• Critical defects might harm a user or cause a whole shipment to be blocked by the customs.
  
• Major defects are not accepted by most consumers, who decide not to buy the product.
  
• Minor defects also represent a departure from specifications, but most consumers would still buy the product.

For most consumer products, the critical defects are not allowed, and the AQL for major defects and minor defects are 2.5% and 4.0% respectively. Remark: a professional inspector will notice defects and evaluate their category by himself. But it is better if the buyer himself describes the most frequent defects and their categories. .

How to read the AQL tables

The master tables included in the relevant standards are commonly called AQL tables. Let’s take an example.

 

You buy 8,000 widgets from a factory, and you choose the normal inspection level. In the table below, you see that the corresponding letter is L.

 

 

 

 

 

 

 

Now let’s turn to the next table. (It is only appropriate for normal-level inspections). The letter L gives you the number of samples to draw at random: 200 pcs. And what about the AQL? Let’s say you follow the usual practice of tolerating 0% of critical defects, 2.5% of major defects, and 4.0% of minor defects. The maximum acceptable number of defects is 7 major and 10 minor. In other words, the inspection is failed if you find at least 1 critical defect and/or at least 8 major defects and/or at least 11 minor defects

Additional notes, for accuracy

• The number of defects is not the only cause for acceptance of refusal. The products can be refused because they are not conform to the buyer’s specifications, even though their workmanship is very good.
  
• If you have two different products (made with different processes or in different factories), you should do two separate inspections. If you inspect them together, one product might be accepted even though it presents too many defects. Why? Because the better workmanship of the other product might “compensate” for its poor quality.

Now you know how many samples should be selected, and how many defects can be tolerated. But when should inspections take place? After production is finished? Won’t it be too late for corrections if quality problems are discovered? These topics will be covered in the next article.

 

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

This series of articles is about QC inspections. Maybe you let your supplier ship the goods without inspecting. Maybe you use a third-party company to control your products. Maybe you have your own inspectors. Are you taking unnecessary risks? Are you paying too much? The only way to form an opinion about these questions is to be familiar with the basics of quality control.

A word about applicable standards

Militari Standard 105 was created by the US Department of Defense to control their procurements more efficiently. In 1994 they decided to rely on non-governmental organizations to maintain this type of standard. The ANSI, ISO, and other institutes all created their own standard, but in essence they are similar to the latest version of Mlt-Std 105. All third-party QC firms use the same standards and the same statistical tables.

Why use random sampling?

Shipments often represent thousands of products. Checking 100% of the quantity would be long and expensive. A solution is to select samples at random and inspect them, instead of checking the whole lot. But how many samples to select? On the one hand, checking only a few pieces might prevent the inspector from noticing quality issues; on the other hand, the objective is to keep the inspection short by reducing the number of samples to check. The relevant standards propose a standard severity, called “normal level” or “level II”. It is designed to balance these two imperatives in the most efficient manner, and it is used for more than 90% of inspections. For example, for an order of 8,000 products, only 200 samples are checked.

When to switch to tightened or reduced levels?

Suppose you source a product from a factory that often ships substandard quality. You know that the risk is higher than average. How to increase the discriminating power of the inspection? You can opt for the “tightened level” (level III) and more samples are checked. Similarly, if a supplier has consistently delivered acceptable products in the past and keeps using the same workshop, you can choose the “reduced level” (level I). As fewer samples have to be checked, the inspection might take less time and be cheaper. In practice, the relevant standards give very precise guidelines about when to switch, but most importers rely on their “gut feeling”. If you want to respect these guidelines strictly, ask your QC manager or your external inspection provider.

The “special levels”

Inspectors frequently have to perform some special tests on the products they are checking. In some cases the tests can only be performed on very few samples, for two reasons:

• They might take a long time (e.g. doing a full function test as per claims on the retail box).
  

• They end up in product destruction. (e.g. unstitching a jacket to check the lining fabric). For these situations only, the inspector can choose a “special level”.
  

So we have three “general” inspection levels, and four “special levels”. For a given order quantity, each level gives a different number of samples to check. Let's see how it plays out in two examples.

Example 1: You order 40,000 products

Special levels				General levels
S-1	S-2	S-3	S-4	Reduced (I)	Normal (II)	Tightened (III)
8 pcs	13 pcs	32 pcs	80 pcs	80 pcs	500 pcs	800 pcs

The number of samples to draw from varies from 8 to 800. Depending on the level you choose, the inspection might take only one day, or up to 4 or 5 days.

Example 2: You order 3,000 products

Special levels				General levels
S-1	S-2	S-3	S-4	Reduced (I)	Normal (II)	Tightened (III)
5 pcs	8 pcs	13 pcs	32 pcs	20 pcs	125 pcs	200 pcs

The number of samples to draw from varies from 5 to 200. If the product is not particularly complex, a professional inspector can check 200 samples in a day. In this case you can choose the tightened level for more reliability at no extra cost. But the factory might have a little more repackaging work.

In practice, how to know the number of samples to select for each order quantity and each level? In the next article I will show how to read the statistical tables and get this information.

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

After you have arrived in China, the following are crucial points to consider. 

• Choose your visiting time wisely

We always try to arrange plant visits at two time slots: 8:30 – 11:00 and 14:00 – 16:00. Compared to normal office times in the West, Chinese plants have different working hours. They start and close earlier and have a longer lunch break. You can only see the production line in operation in one of these two time slots.

• Things to look out for during the workshop tour

Every company has their own evaluation methods to rate suppliers. Here we just mention a few basic points that we have picked up from experience.

1. Ask and verify the raw material sources of your suppliers to make sure that the products are qualified to meet your country standard
2. Check the production process in detail. Make sure their examining and testing machines are actually functioning properly
   
3. Check the warehouse. By doing this you will easily be able to figure out their production capability and product development
4. Make sure their export packaging meets your requirements, especially if you are the first client from your country working with this supplier. The customs of different countries have varying rules regarding packaging. Do not assume the supplier knows the requirements of your country

• Meeting manners

When you hand out business cards, please hand it out with both hands and try to pronounce your name slowly and clearly.

• When in China, do as the Chinese do

Chinese people will always invite guests for lunch or dinner, especially if it is the first time you meet them. You may follow the head of the group and get seated beside him. Fewer suppliers these days will force you to drink with them, but if you do drink with them, it is definitely a sure way to establishing a good relationship.

All international purchasing managers try to minimize import risk. As a China sourcing expert, in order to achieve this goal we will always recommend you to undertake plant visits to China before you place an order, for the following reasons:　

 

• It makes sense to meet the people who you will be working with before you place an order. You will get to know their personality and will start building a relationship with them. As we know, good relationships (or guanxi in Chinese) play a crucial role in business in China - hence the value of a face-to-face meeting can never be underestimated.

• You can inspect manufacturing areas to get an idea of raw material quality, workers’ skills, production capabilities and the internal QC process of the manufacturer. There is nothing better than to see it with your own eyes.

• You can find out to what extent your manufacturers subcontract their production to other plants by checking their work areas and warehouses, or by asking them during meetings.

• You can experience the working environment and meet the workers to be sure that your suppliers are not using child labour and are providing protection masks etc. 

• By making the trip to China, you can give your suppliers a sure signal that you are really serious about quality issues, and more so if you emphasize quality during your meeting. When they produce and deliver products, they will put you in a ‘Picky clients’ list and will therefore be more careful with your products.
  

 

Some extra benefits you can gain from visiting your China plant:

• You may find out that you can actually source many other products in China besides those in your current plan. I had a client before who saw good packaging material during his plant tour in a steel tube plant and finally ordered some packaging materials as well.

• You may see your competitors’ products in a production line during your plant tour. This happens a lot in the top equipment manufacturing plants of China as they get orders from all major international players.
  

As the milk powder scandal shows, out in the trenches, over the past year, nothing’s really changed...We still have the same issues with factories not meeting agreed upon standards, not understanding those standards in the first place, substituting cheaper domestic products in place of more expensive imported ones, using uncontrolled sub-suppliers, working rejected product back into approved stock, and of course purposeful and natural quality fade issues.

In the latest of their TrendWatcher series, the Institute for Corporate Productivity last week produced a piece entitled China's Quality Squeeze, which incorporates a range of statistics, notably:

• 70% of product recalls in 2007 involved Chinese goods, a scenario which has been greatly helped by the
  
• 30% annual increase of Chinese imports to the U.S. from 2001 to 2005, so that today
• 40% of all U.S. consumer imports come from China.
  

This despite the range of well-publicized China supply-chain quality lapses and gaffes of 2007, which have, however, not significantly dampened foreign firms' confidence in continuing to source from China. Instead, the strategic impact of the recent wave of quality concerns in China is inducing companies to inject more stringent quality control measures in their dealings with Chinese suppliers. Even so, the TrendWatcher piece continues, in its examination of best practices and risk factors for sourcing goods from China, a Quality Executive Board (QEB) survey found satisfaction with Chinese imports confined to a relatively small segment of companies that have developed long-range supply chain strategies that employ diligent pre-contract vetting and costly onsite visits.

In outlining how sub-quality products can reach the international marketplace, contract manufacturer Mike Bellamy at Smart China Sourcing recently pointed to how bad things can happen when a certain set of factors overlap. The fast growth of China's production base in recent years has given rise to a rapidly changing environment with a wide range of manufacturers of various quality standards. And as today's communication technology facilitates increasing numbers of first-time foreign buyers to suffer from a lack of experience in sourcing from China, an uninformed choice may lie at the root of product quality problems. (See also Sebastian Bretau at China Success Stories on how product inspection, auditing and testing can be used to spot potential issues before shipping, rather than upon delivery).

In a familiar refrain recurringly echoed by Silk Road International's David Dayton, Bellamy writes

The single most critical action you can take to ensure a successful sourcing program is to visit your selected factory.

In fact, in Dayton's experience, the money saved from not coming to China multiple times will be lost in missed delivery dates or quality problems. Yet simply making it to China is not enough, because without painstaking diligence on your part, you're not going to get what you asked for. In Dayton's list of rules for international purchase managers, this diligence includes, among other things:

• personally speaking Chinese (I suspect, the first problem)
• personally and physically having samples tested and confirming they match production, and
  
• never getting angry in the midst of problems (the challenge is to get your supplier to like you).

And if you do make it to your Chinese factory, Dayton advises, beware if their answer to all your questions is 'no problem, of course we can do that,' because then you are simply not going to get what you asked for.

If there is one product that has received way too much attention in 2007, it must be those millions of toys 'made in China,' a tainted few of which caused such an uproar this year. Those 'few,' whether blamed on the faults of foreign importers or on Chinese manufacturers, had a significant impact on global perceptions of the quality of Chinese products. Yet in the aftermath of the Mattel saga Chinese toys, food products and others have all been subjected to stricter quality controls, and have moreover been caught up in 2007 in the general drive for improved quality occurring in China (see CSB's 2007 China Sourcing Review).

As reported in a previous posting, China's toy-making heartland in Guangdong province stated already by late November that global demand for its toys had rebounded from the recall dramas of earlier. In the end nothing much has changed, because with Chinese toys still cheap and their quality improving, demand for them will not abate. 

But not so for Barack Obama.

A Reuters report yesterday quoted the presidential hopeful as saying he would ban all China-made toy imports following the safety scandals of this year, though admitting that such a move would cut off about 80 percent of toys in the United States. Calling for tougher inspections, Obama cited the example of Japanese food safety inspectors who go to China and meticulously test all food products sent from there.

Obama would probably be heartened by reports from China yesterday claiming the four-month national food safety campaign managed to hit its targets early, with a state newspaper reporting that officials seized 'thousands of tainted products and (put) many unregulated shops and eateries out of business... Inspectors shut 192,400 unlicensed food producers and pulled 29,800 products from the shelves.' 100% of stores in larger towns and cities, it was proclaimed, now had a quality label system in place and could trace back where their supplies came from.

And on the day after Thanksgiving, Xinhua reported yesterday, U.S. customers 'rushed in their hordes' to stores such as Toys 'R' Us to purchase Christmas gifts for their children. The article mentions Samantha Gusteins, a mother of one, who was carrying two big bags of toys and about to leave a store, saying "The toys are many and affordable."

No doubt she and many other shoppers would have Obama think twice about going to such extremes...      

Ahead of impending cabinet-level talks between China and the United States likely to be dominated by fears of substandard Chinese-made products, the U.S. Secretary of Health and Human Services Mike Leavitt today in a conciliatory tone said the issue at hand was one of improving the monitoring of imports,

Our message to China, as well as to every other import/export partner we have, is if you desire to produce goods for the American consumer, you need to meet American standards of quality. We want you to know what they are, and we'll work with you to meet them.

The current emphasis on effective and sustained monitoring, resulting from the product quality and safety issues involving Chinese products in 2007, echo findings from KPMG's March 2007 Sourcing Survey (available here). Acclaiming sourcing, when managed well, as having evolved today to a key strategic business tool, the survey found 'significant opportunities' still exist for organizations to capitalize on the strategic value of sourcing;

this potential is often unlocked by more consistent measurements of contract provisions and other metrics about the relationship with service providers... This measurement process, while challenging, can be instrumental in protecting the bottom line (and) also helps consolidate the alignment of expectations among both customers and service providers, enhancing overall corporate governance and ensuring money is well spent.

In Asia Sentinel today John Berthelson looked at how the events of 2007 have impacted on sourcing companies in China. Numerous quality concerns have contributed to the development of a flourishing quality-testing industry, and with such vast amounts of products flowing out of China, Chinese producers have come under ever-increasing scrutiny. Yet the companies in the first line of fire here are the sourcing companies who constantly and vigilantly need to ensure factory owners are delivering on what they promised. Hence sourcing companies are constantly engaged in monitoring and testing, not only when products are made but also when they are transported. Speaking of logistics, in today's macro-growth China forecast the organiser of the Asian International Transport and Logistics Exhibition stated in Beijing that the value of China's logistics industry rose 12.1% over last year and is expected to grow 20% annually, reaching 1.2 trillion RMB in 2010.

The New York TImes today reports China's explanation for blocking the visit to Hong Kong last week of a U.S. carrier battle group and other American warships. The lack of hospitality was actually in retaliation against the upgrading of Taiwan's Patriot anti-missile batteries, proposed by the Bush administration. Even two minesweepers were turned away from Hong Kong's protected harbour when seeking shelter from a storm. Although China later rescinded its decision, the Pentagon launched a formal complaint as senior U.S. naval commanders said they were 'perplexed and troubled.'

Yet two commentaries today on China's global supply chain dynamics give a different perspective of the expanding levels of engagement. Author and Boston Consulting Group senior partner Hal Sirkin writes in the Washington Times that the era of the global supply chain has arrived, and companies need to deal with it and adapt accordingly. While the U.S. and Chinese militaries might not be the best of friends, relations are much better between the Consumer Product Safety Commission (CPSC) in the U.S. and its Chinese counterpart, the General Administration of Quality Supervision, Inspection and Quarantine (AQSIQ), who have concluded an agreement supposed to resolve safety issues. The real responsibility for ensuring safety, however, Sirkin writes, lies in 'corporate boardrooms and with corporate managers' and their ability to monitor global supply chains. Low-cost demands extra vigilence, and companies should monitor their suppliers instead of simply blaming 'the Chinese.'

Bradley Feuling today in Industry Week adds an interesting assessment of the status of the China supply chain. Whereas cost was originally the primary driver for companies entering China, quality has since become increasingly important, and this has emphasised machinery investment and internationally recognised certifications. But today, according to Feuling, companies must pay more particular attention to the China supply chain itself. As opposed to squabbling as independent operators for supply chain knowledge, execution and talent, Chinese manufacturers can take advantage of new competitive advantages as China's expansion continues. In fact,  

By further developing a supply chain and procedural mindset, we may witness a true great leap forward rapidly approaching.

With all the high-profile product recalls and quality scares associated with Chinese products this year, events in the news can give some sense of the response elicited from Chinese government and business circles. Xinhua today reports customs authorities in Guangdong Province, a major base for toy-making industries in China, saying demand for exported toys has rebounded from the recall dramas of earlier this year. Partly spurred by the start of the Christmas retail season, Guangdong toy exports in October still registered no less than a 27.6% year-on-year increase. Yet in reaction to the outcry over toy safety the province launched a month-long safety inspection in September, and the provincial Quarantine and Inspection Bureau subsequently withdrew production licenses from 423 toy makers.  

In terms of food safety, a Chinese government spokesman has recently outlined the measures recently taken in legislation, administration and media supervision. In the aftermath of international food quality scandals Chinese officials have called for international consultation on food security, and today saw news of the issuing of a joint declaration in Beijing by 600 World Health Organization (WHO) and international delegates from 45 countries to boost information exchange on food contamination and disease outbreaks. 

It seems likely in fact Chinese manufacturing is taking the quality concerns of 2007 in its stride. The editor of Cargonews Asia this week expressed his amazement at signs that manufacturers in China have actually increased their profitability despite a number of challenges such as inflationary pressures and increased costs of raw materials:

The rising costs forced mainland manufacturers to seek out the inefficiencies in their systems that were previously of little consequence... Labour costs have always been low enough that some factories employed hundreds of thousands of workers with no regard for the payroll. Those days are over. Better transport and storage of raw materials, improved technical efficiency in the production process, better warehousing and road access have all enabled factories to cut down on waste and ramp up productivity.