by George Huang
How much money do you lose on each product shipment due to customer returns? How much time do you waste fixing defective goods to make them ready for distribution? And how many suppliers have you worked with that you wish would take steps to reduce or prevent the quality defects that are hurting your bottom line?
It’s obvious to most of us in the manufacturing, import and SCM industry what headaches quality defects can bring.
But how can you, as an importer, address product quality issues with your supplier directly? How can you get the factory to change their processes to make a better product? And how can you accomplish this in a way that improves your relationship with your supplier, instead of deteriorating it?
Acting as an intermediary between importers and suppliers for years, we’ve seen all kinds of quality issues and the ways importers have tried–some more successfully than others–to mitigate them.
Here are three keys to addressing product quality issues with your supplier:
Most importers mistakenly think that being “specific” about product quality issues simply means telling their supplier which defects are not acceptable. But actually, being specific extends beyond the problem to proposing possible solutions.
Let’s say you’re importing earbuds that have an injection-molded, rubber outer coating. The finished goods you receive have a number of defects related to the molding process, namely excess material, or flash. If you’re not happy with the number of defective pieces in the shipment, you might tell the supplier to fix the molding issues in the next shipment.
Your supplier might proactively investigate the cause of the quality issues and alter their processes to fix them. But they probably won’t. It’s more likely that you’ll see many of the same problems with your product recurring in the next shipment.
A better response is to find the potential causes for the defects you’re seeing in the finished product. If you’re not an expert in the product you’re importing, talk to someone who is. Do a bit of research to find out why these product quality issues tend to happen in similar products. Learn the specifics.
For defects related to injection molding, it doesn’t take long to discover the following possible root causes:
Even fixes that strike you as a “no brainer” might not have been considered by the factory. This is especially true for a factory that is less-established and hasn’t yet developed effective quality management systems.
You may feel like it’s not your responsibility to address product quality issues at the factory. But it never hurts to go a step further in providing helpful and actionable feedback to your supplier. Be specific.
This is one point that many buyers don’t realize and even fewer really appreciate.
The first aspect of being realistic relates to expectations. Regardless of who is manufacturing your products and where, you’ve probably never received a shipment that was 100 percent flawless. Quality issues in some quantity of goods are typically acceptable and, in fact, expected. The concept of AQL sampling allows for some defective product.
Secondly, suppliers, especially trading companies, often earn only a slim margin when selling you your product. Let’s look at an example from Mattel toys and their suppliers in China, the makers of products like Barbie dolls and matchbox cars. “A single toy typically brings it a profit of around US$3.60, out of which the Chinese manufacturer earns about 1.5 cents.”
Any investments in new tools, equipment or processes will cut into that margin. So when you’re considering possible remedies for the product defects you’re seeing, you should consider the cost to the supplier.
Let’s return to the injection molding example from earlier. To solve the problem with flash, there are a few possible solutions:
You might have guessed that these options were ordered from least to most expensive. The factory isn’t likely to redesign the mold just because you tell them to, especially if you’re not one of their major customers.
The factory will need to allocate workers to cut away excess material before packaging. But as long as they do the cutting prior to packaging, this is a relatively low-cost solution.
Increasing the clamp force is typically the best option if it solves the flash problem. And there are two great reasons why:
If you’re asking your supplier to make a change that will cost them time and/or money, you’re far less likely to see that change happen. Understand the impact that your corrective or preventative action will have on the supplier’s bottom line. Be reasonable.
This last point is probably more obvious to you. But the method for holding your supplier accountable may be less so.
One way to hold the supplier accountable is to charge them back for defective product. This approach can be effective only if you agree with your supplier ahead of time. It’s also a less-than-ideal approach, since the issue isn’t addressed until you actually receive the finished goods.
You may be happy to get a refund for goods you can’t sell. But you’re customers likely won’t be happy to find out their orders can’t be filled as agreed.
A better approach is to hold the supplier accountable before shipping, so there’s an opportunity to resolve product quality issues. By carrying out pre-shipment inspection, you’ll get a timely look at your order that shows whether the goods meet your specifications and quality expectations.
Then, based on the findings of inspection, you can communicate your suggested corrective actions with the supplier. Once the supplier agrees to a solution, you can re-inspect the goods. If the goods fail inspection repeatedly, you can begin charging back the supplier for failed inspections.
In this way, the supplier is directly held accountable for addressing quality issues. And you also have the added benefit of deciding whether or not to ship the finished goods based on the quality level you see from inspection. Once you see a consistent improvement in product quality, you can consider scaling down inspection frequency.
No one likes product defects, including your supplier. But it’s important to understand that suppliers are constantly balancing cost with technical ability and other factors to meet buyer expectations for both product and shipping.
The next time you receive a shipment of product that doesn’t live up to your standards, consider the relationship you have with your supplier. Investigate quality defects and suggest possible solutions. Be reasonable in asking your supplier to change what they’re doing to address quality issues. And hold your supplier accountable by coming to an agreement and routinely checking the product before it leaves the factory.
Most importantly, continue to communicate openly with your supplier. Work with them to improve product quality. Progress is built on cooperation not confrontation.
George Huang is a Client Manager at InTouch Manufacturing Services, a QC firm that performs product inspections and factory audits in Asia for clients in the US, EU and Australia.
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