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Best practices for choosing the right Chinese factory

by Renaud Anjoran 

Maybe you are looking for a new Chinese factory and you are not sure how to find a good one. You’d like to get inspiration from those companies that have THE BEST supplier screening process.

Well, look no further than the car industry. A car assembler, say General Motors or Volkswagen, has to decide on 1 supplier for each part of a new car — and then they CANNOT change that supplier for the life of the car in question.

Why can’t car manufacturers switch suppliers?

David Collins, consulting director at from CMC, explained to me why. Double-sourcing one part — let’s say buying a seat from two suppliers — would require so much additional work and testing that the final bill would approximate 500 million USD. Very heavy testing is required by law, and 1 new part in a car would make the whole testing process start again.

So having a backup supplier is impossible. That’s a very uncomfortable situation. When a manufacturer has quality or delivery issues, the implications for their customer (the car plant) are enormous. A downtime in a car factory costs tens of thousands of dollars per minute.

In this situation, qualifying the suppliers and approving their parts is a critical process. Picking a wrong supplier (which will deliver late, or deliver poor quality) is extremely costly.

How do car manufacturers select the right suppliers?

Car manufacturers use the PPAP (Production Part Approval Process) to quality each part coming from outside suppliers. The PPAP includes quality tools that are usually seen as particular to the auto industry, but that are applicable in any industry — electronics, furniture, etc.

Now, let’s be realistic. The PPAP process is very heavy and involves a LOT of documentation. It is very useful in bringing the risk of working with the wrong supplier down, but should you go through all these steps? No.

What you should do is the 20% of the work that will get you 80% of the results.

Here are the PPAP process steps:

  • Design Records
  • Authorized Engineering Change Documents
  • Customer Engineering Approval, if required
  • Design Failure Modes and Effects Analysis (DFMEA) applied in special situations
  • Process Flow Diagram
  • Process Failure Modes and Effects Analysis (PFMEA)
  • Control Plan
  • Measurement Systems Analysis (MSA)
  • Dimensional Results
  • Records of Material / Performance Test Results
  • Initial Process Studies
  • Qualified Laboratory Documentation
  • Appearance Approval Report (AAR)
  • Sample Production Parts
  • Master Sample
  • Checking Aids
  • Customer-Specific Requirements
  • Part Submission Warrant (PSW)

How can importers get inspiration from the PPAP?

Among the above list, here are the tools every importer should try to apply when selecting a new supplier for custom-made products:

  • Design Records
  • Authorized Engineering Change Documents
  • Design Failure Modes and Effects Analysis (DFMEA) if the design is a bit complicated
  • Process Flow Diagram
  • Process Failure Modes and Effects Analysis (PFMEA)

And, once an order has been issued and the factory is willing to invest time and energy in improving their processes and their organization, these steps generally make sense:

  • Control Plan
  • Measurement Systems Analysis (MSA)
  • Dimensional Results
  • Initial Process Studies (including running small pilot batches at the rate of mass production)
  • Master Sample
  • Checking Aids

What do you think?

Renaud Anjoran has been managing his quality assurance agency (Sofeast Ltd) since 2006. In addition, a passion for improving the way people work has pushed him to launch a consultancy to improve factories and a web application to manage the purchasing process. He writes advice for importers on

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