How often do you carry out a supplier assessment in a year? What forms of assessment do you use? Which one do you think is most critical, especially for your suppliers in China?
Before presenting my answers against above these questions, I would like to share with you a real story that I experienced in the past.
We were buying sort of aluminum products from one supplier in China in the past. The product is a semi, which would be assembled again with the other components after we received them, with high standard of surface quality requirement.
We did basically the things that necessary for qualifying a supplier at the development phase, such as contracting, audit on quality management system inclusive of tooling management and control plan, 5S, first article etc. Even we did second round as a follow-up to those open problems. Then we started the series production.
Orders came in, and production run very well.
We clapped hands and enjoyed tea from there! Both were very happy.
One day, we suddenly found a problem from one shipment about unacceptable surface scratching upon the goods arrival. The scratching was quite noticeable that you barely had a chance to ignore by common sense, even not by quality standard.
Immediately, we were like a rat, scurried around, and rushed shipping back defectives, pushing supplier for replacement and correctives. Both were in a very passive situation.
Eventually, we got by the embarrassment. However these incurred higher dispensable costs, either in our side or supplier side:
- Shipping back and forth
- Scrap cost in both raw materials and fabrication
- Additional manufacturing cost: re-setup machines, prioritization of cut-in orders amongst others, extra pay to labors for overtime work occasionally
On top, longer delivery time, downgraded customer satisfaction, and so on.
You might be wondering what happened in fact behind this accident. Not that mysterious, the supplier found the scratching already during the production and even packaging, but they just wanted to gamble it.
What if we did through production inspection and before shipment check? We are doing in general, but we only missed for this batch unfortunately. We were too relying on the foregoing assessment and understanding with that supplier, which were true positive. It does not mean the inspection we do during the whole production is a redundant work, it proved absolutely NOT.
Story ends here.
Now I could answer the very first three questions.
In our experience, most companies only conduct once a year (some even less frequency, very risky) for supplier assessment or evaluation, naming annual evaluation. Definitely it’s not sufficient especially for your suppliers in China.
Many forms of assessment can be done, but I will not bān mén nòng fǔ(showing off in front of your expertise). While what I do like to emphasize is the necessity of physical or on-site check, twice a year at least, in a systematic approach.
This will be the most crucial form in China, and for your Chinese suppliers.
You will have the chance to identify the change of personnel, machines, their procurement, and most importantly their market development, some times even the owner will run a second independent business, which has nothing to do with yours, and that will possibly distract the owner’s focus and endeavor from current one, you do not expect that happen certainly.
Batch inspection (I call it) and systematic assessment must be combined together, to guarantee the supply safety and quality in a holistic way.
While, site check in both approaches requires massive traveling and effort, which only can be done from local like us. You will benefit from this approach greatly, believe me.
Same concerns from your current supply chain, or plan to start for your new suppliers in China?
Welcome you to contact us for a conversation towards your needs in China, and we’ll be for sure happy to facilitate your requirement.
PINTUU Business International
Post time: Jun-14-2018