How did you prepare for the inevitable halt in production this past February as tens of thousands of factories in East and Southeast Asia closed for Lunar New Year?
Did you struggle to ship out goods before a deadline? Did you spend late nights in a stuffy office, sweating product details with your overseas supplier on the other end of a Skype call?
Keeping shipments on schedule is one of the greatest challenges importers regularly face. And delays can be especially hard to avoid when you’re grappling with serious quality problems that need to be addressed before shipping.
But experienced importers have learned to take action early on to prevent production and shipping delays. They’ve succeeded in meeting their customers’ expectations for delivery date without compromising their expectations for product quality.
What’s their secret to dazzling their customers without suffering stomach ulcers? Let’s dig into some importing tips and find out.
1. Set clear expectations for product quality and deadlines upfront
The single, most common mistake importers make is likely failing to properly screen suppliers and clarify expectations upfront. Not only can this mistake cause production and shipping delays, but it can also have a major impact on product quality.
When suppliers don’t understand or agree to meet a buyer’s expectations, the buyer may only discover this close to the budgeted shipping date. The result is often a scramble to correct issues found, while also struggling to meet deadlines. Other times the buyer may find issues that can’t be remedied, or worse, may only discover them after the goods have left the factory.
There are a few steps you can take to ensure your expectations are reasonable and clear.
Understand your customers’ expectations for your product and shipping deadline
Market research probably isn’t the most glamorous aspect of doing business for most importers. But according to Eric T. Wagner, a successful entrepreneur and Forbes contributor, the number one reason businesses fail is they’re “not really in touch with customers through deep dialogue”.
This concept extends to understanding your customers’ needs regarding product quality and deadlines. And doing so can save you a lot of time and money in the long run. This is especially true if you’re working directly with an original equipment manufacturer (OEM) to develop a new product.
For example, maybe you’re investing several thousand dollars in new tooling at a factory because you want to add a feature to an existing product. How do you know your customer will value the new feature? Many manufacturers simply guess that, since they find the feature valuable, their customers will as well.
To what extent the change will complicate production and raise the risk of quality problems and delays are other important considerations. And your customers should have every reasonable opportunity to weigh in on whether they can accept these risks.
Choose the right supplier and reach an agreement upfront
Delays are just one of the likely consequences of working with a supplier that’s not a good fit for you and your customers’ needs. An audit of the supplier’s quality management systems (QMS) is one of the best ways to assess their capabilities.
But even a more casual visit to their facility can offer a lot of insight to help you make an informed sourcing decision. Some relevant observations might be:
- Does the factory appear to have adequate production capacity? Your supplier contact may have led you to believe they have a large facility. But the actual “factory” could just be 15-20 staff working in an old apartment building.
- Does the factory have a clear production schedule to manage orders? Production facilities that lack basic organization are usually prone to missing deadlines or rushing to meet them.
- Is there an independent quality team with sufficient members? Quality problems and subsequent delays are likelier when there’s no distinct team tasked with QC.
Once you’ve chosen a supplier to work with, the next step is to reach a clear agreement on product requirements, any expectations for outside inspection, exit factory date and potential consequences to the supplier for not meeting their obligations.
Will your supplier agree to refund a certain percentage of the PO value if a significant quantity of the finished goods are defective? Will they attempt to rework any pieces with quality problems? How will they be accountable to keeping production and shipping on track?
These are just some of the questions you might consider addressing with your supplier before placing the first order. And experienced importers often have a much longer list of concerns to voice as they further qualify their suppliers.
But even reaching a basic agreement of deliverables before moving forward with production can save you from delays and other more serious problems.
Include key people when setting your product quality standards
Misaligned standards or product requirements often contribute to production and shipping delays at the factory or distribution center. This often happens when differences between standards need to be addressed before shipping:
- Your customer may have one standard
- You may have a second
- Your QC inspection team may have a third; and
- Your supplier may have a fourth
Because each has their own standard, all four parties may have a unique method of assessing the product and any defects found. What the production manager at the factory may accept as a “minor defect” your customer may see as reason to reject your product. This most often occurs when the buyer includes some, but not all, key people in the process of developing their quality standards.
Ask your customers what their requirements are for your product. Get feedback from your supplier about their capabilities to ensure these expectations are achievable. And work with your inspection team to develop criteria for evaluating the product during inspection.
Include all these details in a quality manual, or quality control checklist. Keep this document current by updating it as needed, and share it with your QC staff and supplier so everyone’s expectations stay aligned
2. Get regular updates from someone at the factory
Delays in production or shipping are often a reflection of breaks or delays in communication. But keeping abreast of the situation at your supplier’s facility can be tricky. Anyone who’s ever manufactured products abroad can probably tell you how hard it can be to reliably communicate with some suppliers.
Besides an often formidable language barrier, many suppliers are just hard to stay in contact with. You might reach their voicemail anytime you try to phone them. You might wait days or more to receive a response to an urgent email. And then there’s the time zone difference—you may need to stay up until 1:00am or wake at 5:00am just to (hopefully) reach your supplier during their work hours.
Getting regular updates from your supplier can be even more difficult if your only contact is a salesperson.
Why information from your sales contact at your supplier isn’t always reliable
Like most importers, you may be dealing with a salesperson as your main point of contact. This person receives your product requirements, facilitates the transaction for the order, gives you status updates and answers your questions along the way.
Your sales contact may speak your native language fluently. And you might have a great relationship with them. But there are still some common limitations with communicating through someone in this sales role:
Lack of relevant expertise with your product
Some salespeople may have relevant manufacturing experience that lends to better understanding your product requirements. But English proficiency is the main hiring requirement for salespeople at many manufacturing organizations in Asia.
There’s often a greater risk that requirements will not be relayed reliably to production staff at the factory when your main contact lacks technical experience with your product type. Likewise, the feedback you receive from a sales representative may not be as clear as if you were able to talk with someone on the production floor.
Physical distance from the factory
Factories often have their own salespeople to handle buyers. And these salespeople sometimes work out of an office on the factory grounds. But if you’re working with a trading company or vendor, your salesperson is very likely working in a different city entirely, or perhaps even a different country.
It can be very challenging to reliably communicate with someone who’s far removed from the actual facility where your product is being made.
Instead of being able to see the product and assess the situation at the factory firsthand, your contact may be limited to contacting the factory and trying to understand what’s happening secondhand. This can compromise the reliability of information you receive and your ability to problem solve.
Cultural differences that affect communication
Depending on you and your supplier’s background, you might face some challenges with intercultural communication.
For example, you’ll likely have a vastly different experience communicating to someone from a “high-context” culture than one from a “low-context” one. The former typically relies more on implicit meanings and nonverbal ques, while the latter typically relies on explicit and direct verbal communication.
You might be accustomed to direct communication, especially when concerning problems with your shipment at the factory. And you may misunderstand the situation your sales contact from a “high-context” culture is trying to convey to you. This communication lapse can easily lead to delays and other problems.
Try to talk with someone directly involved with production at the factory whenever possible. If there’s a significant language barrier, ask someone from the factory to send photos of production or of the product. Consider traveling to the factory with an interpreter to meet with production staff.
If all else fails, send some skilled inspectors to the factory to report on order status and product quality.
3. Conduct DUPRO and pre-shipment inspection
Whether by your own staff or a professional third party, inspection plays a vital role in anticipating and addressing problems and avoiding delays (related: 4 Ways Importers Conduct Product Inspection [eBook]).
You might be receiving regular updates and photos from factory staff. But you can’t truly know the situation with your goods without sending a trusted agent to visit, inspect and report back. A detailed inspection report can alert you to all kinds of issues you might otherwise not have found until receiving the goods.
And if you need your shipment to leave the factory by a certain date, inspection will also help you confirm whether production is on track to meet that deadline.
How does inspection during production help prevent delays?
Pre-shipment inspection generally occurs when 80 percent or more of the total order quantity is finished and packaged. Importers often consider it the minimum amount of oversight needed before shipping.
But pre-shipment inspection only offers a limited view of your products. You’ll usually need inspection earlier in the process to catch the kinds of issues that can lead to delays. During production (DUPRO) inspection, offers this advantage.
For example, let’s say you’re manufacturing upholstered furniture and factory workers are using the wrong fabric. This kind of issue would be a major setback to discover with pre-shipment inspection when most of the goods are already finished and packaged.
But a DUPRO inspection performed around the time workers begin adding the upholstery would help you catch and correct the issue with little or no disruption or delay. Inspections at other productions stages would offer you even more transparency.
4. Work toward continuous improvement to prevent future production or shipping delays
Some importers experience repeated quality issues from suppliers that lead to delays as they try to address the issues before shipping. Others are able to consistently meet shipping deadlines only by accepting serious quality issues and sending substandard goods to their customers. Something has to give in both cases and neither tends to be sustainable in the long term.
Successful importers that persist through problems early on know the value of continuous improvement to keeping their business afloat. This is shown in what quality professionals call the plan-do-check-act (PDCA) cycle. The principles applied to managing production and shipping deadlines are simple:
- Plan: have a plan in place with your QC team and supplier about how to check your products and address potential problems—there will almost always be problems.
- Do: follow through on production and maintain open and regular communication with your supplier.
- Check: visit the factory, or send someone on your behalf, to inspect the goods at multiple stages of production. Get feedback from your customers after they receive the goods. Discover any issues and decide how to best avoid them in the future. If your shipment is delayed, discuss with your supplier how to limit or prevent future delays.
- Act: follow through with corrective actions or changes to improve results—whether the goal is to improve quality or better meet shipping deadlines. If there is misalignment or miscommunication of product requirements, update your QC checklist or otherwise clarify expectations. If quality issues were found too late in production, consider inspecting the next batch earlier.
What will separate you from those that struggle with meeting their time commitments to customers will be your ability to adapt and prevent future delays.
Production and shipping delays are more likely among less experienced importers and those working with a new supplier. But few importers, regardless of experience, have never encountered problems that led to delays. And delays can cost you customers, especially if you’re working with retailers that have strict delivery conditions.
So the next time you prepare to place an order with a supplier, be sure you’re taking steps to ensure expectations are aligned. Stay in regular contact with someone at the factory, if possible. Investigate your goods with inspection ahead of when you expect them to leave the factory. And work toward continuous improvement to limit or prevent any delays in the future.
What are you tips for meeting production or shipping deadlines? Share them in the comments section below!