What is a supplier review and what sets it apart from other types of factory audits?
If you follow our blog, you know that factory audits in China are a recurring topic throughout our articles because we’re a QC company and that’s our bread and butter. However, we have never gone back to the basics and covered what a supplier review is, and why it is so important.
One of the first rules of manufacturing in China is to never trust your supplier 100 percent. Always check and double check everything your supplier representative says or claims they do. It might sound a bit cynical, but if you know anyone with experience manufacturing in China, then chances are you’ve heard some horror stories from people who’ve worked with bad suppliers.
So regardless of what your supplier tells you, a first-hand investigative report of your factory is a MUST before placing that first order. That’s why in this article, we will give you an introduction to one of most common types of factory audits in China.
Getting the basic data
Factory audits generally begin by checking the basic information provided by the supplier. Everything from financial information, factory location, contact information, production area and evidence of other customer orders is investigated. If a factory exports abroad, an audit of this kind will serve to verify the factory’s export license. Checking basic documentation helps verify the factory actually exists and, more importantly, has the ability to produce the products you need.
Facilities and factory production environment
This particular portion of a factory audit is the actual checking of processes (molding, assembly, packaging, etc.), equipment and documentation to ensure the supplier is organized according to internationally-recognized ISO 9001 standards. This aspect of the supplier review also verifies that all the machines/equipment are properly calibrated and documented. Good organization may not sound like a relevant criterion for you, but organized factories are generally found to make better quality products than those that operate in a disorganized environment.
Auditing materials control
All products come from raw components, so if the materials are not controlled from the very beginning you may find yourself with an entire shipment of products with similar defects due to poor material quality. An example of this can be seen in the lumber used for manufacturing furniture. If the lumber received has high moisture content, this can lead to “warping” or deformation of the wood which can affect the finished product.
With this in mind, an auditor may ask the factory to provide records of Incoming Quality Control (IQC) on the raw materials being used. A supplier review will also seek to find if these inspections of raw materials cover 100 percent of the products or are randomly sampled. Does the factory follow the First-In-First-Out principle of inventory in the warehouse? Is everything labeled and are the defective units properly separated from the “good” units? A factory audit of this kind aims to answer all these questions to ensure you are getting only the best product in every shipment.
Auditing internal production inspection procedures
An important aspect of factory audits in China includes verifying procedures are in place – and the supplier review is careful to check that the factory is mindful of controlling the quality of the finished product. After the initial inspection of raw materials with the provided IQC documentation, the next critical process to check is production inspection. Most capable factories should have their own internal QC staff stationed at the end of each line to look over the product coming directly off production. A QC inspector should be there making sure the products are being made to the client’s specifications before they move onto the packaging process.
Supplier reviews are a type of factory audit designed to give buyers – or prospective buyers – an up-close and personal view of a factory’s manufacturing capabilities, organization, management, and quality controls. This audit looks at a factory’s financial and licensing information, , raw materials control, internal quality control and overall professionalism. Only by auditing a supplier beforehand can you be sure that the supplier you’re about to work with is reputable and qualified.
Do you have questions about supplier reviews? Ask in the comments section below!