Quality Control in China: 5 Basic Steps
By Seth Berman
Easy to follow quality control guidelines for people purchasing from Chinese manufacturers.
Ok, so quality control is never easy. But, there are some basic guidelines that, if you follow them like the law, will make your life a lot easier. Most large companies outsourcing with Chinese suppliers have systems in place, and I’ve found them all to be remarkably similar. These concepts go beyond home furnishings, as I’ve seen them applied in the shoe, garment, and electronic industries. Below is a basic summary of the key elements.
Create Master Standards
Master Standards are items which the factory, your company, and anybody looking for details on a product should refer to.
Written Orders and Specification Sheets: The written order is the bible. Make sure you have a very detailed spec sheet for every product. Take the time to create a form for your company that is submitted with every order, so the supplier knows exactly the specs you require. Don’t leave details out. The lack of details in an order means that you are essentially giving the option of “Factory Choice”. If there is any question, you can even write in “all other specs are per the approved sample”. Don’t give the factory the choice, unless you really trust them.
Approved samples: Take the time to sign off on your exact product. If the product you want to buy already exists, make sure when you are at your supplier to take a permanent marker to sign and date the sample. Even better, is to create a sticker that you can sign and date. This lets the factory know that this is what you ordered. When quality inspections are done, this and the written order are what need to compare with final production.
Other steps can be taken, including establishing finish standards, especially if you are using the same finish on multiple items. Also, you can create item files for every sku you order, with images and notes on important details. These can be used as a record for Quality Inspections, and should include the date of an inspection, final inspection results, and any issues encountered. These should be used by your company and can also be used by the factory.
Pre Production Samples (PPS)
If you have inspectors (internal or hired) already in China, it is highly recommended that you take the next step, and review a “pre production” sample. This should be a duplicate of your signed sample, or if there were any modifications needed, this may become your master standard. Also, this represents exactly what the factory is committing to produce for your order. Not only is it good to look at the sample, but you should make it clear to your Chinese supplier that the PPS should include packaging. This way, you can ensure the packaging meets your standards long before shipment, thus avoiding any shipment delays. Your team should sign off on the carton, and take images for future reference. Please note, that carton marks and hangtags may not be finished in time for the PPS sample inspection. You should not let this be a hang up, but should make sure that your written order has very good detailed images of the carton marks, and you should approve your hangtags, if you are not supplying them yourself.
Final Inspection
If you have completed the steps above, your final inspection should be a breeze. The most common complaint I’ve received from lighting manufacturers, is that we did not supply enough information, and that is why they made the error.
There are quite a few ways to do a final inspection, but below are 2 ways I’ve seen used.
100% inspections, pre packaging: Make sure the factory knows the date you plan to view your goods. Have them lay out the order in an open warehouse, along with your master standards, in an area with good lighting. Take out some random specimens and compare your master standards, item by item, and line by line. If these are up to spec, go though the rest, and look at the key areas you expect a problem. I suggest having a label created for your inspector. This way, if a shipment comes in, and there is a problem, you know who to contact. Also, the inspector will be more accountable. If they are not willing to put their approval on a product, are you willing to ship it to your customer? Also, make sure to have a few of the products in the packaging, so you can confirm packaging is to spec, carton marks are correct, and all labels and hang tags are in the correct locations.
Random inspections: This is the most common way for companies to do inspections before shipments. The Chinese factory will have all the goods for the order already packaged and in the warehouse. Your inspectors will go there, and select at random a select number of boxes. There are guidelines and rules as to which level of random inspection is called for, depending on the size of the order. If you have a good factory, and have gone through the above processes, than this is a more time effective way to do an inspection. But, I would suggest the 100% inspections with new suppliers, until you feel you have confidence to move to random inspections.
Training
Last and certainly not least is the most important part of quality control in any situation. Training your quality inspectors well is as important as all of the above steps. You need to work with them, so they understand exactly how your quality control system works, and most importantly, when to ask questions. They will run into cases where something is not 100% perfect, and they will need to make a decision. Clearly defining what decisions they should make, vs. when to bring in a manager is essential. Build a library of examples and images for them to review. Spend time with them, and let them offer their opinion and make the decisions while you are there. Once you feel confident that they can do this on their own, let them do it. Managers can stop by unannounced on an inspection already underway, and help and offer advice, to keep the training going and to get feedback from them on the Chinese supplier. You will be surprised how hard and diligent inspectors are, if you spend the time to train them.
Good Chinese Factories
The final note I’ll make, is that none of this really matters if the Chinese supplier you are working with is not good. If you find a factory in China, which seems to not want to follow through with the steps above, or makes excuses why he cannot achieve what you have outlined, walk away. The will power to move away from suppliers who are not meeting your quality inspections is probably vital to your future business. There are lots of Chinese factories out there hungry for business that ship good quality.
Seth Berman is the founder and CEO of GoodFactories.com. Berman has years of outsourcing and manufacturing experience in China. He has worked in quality control, purchasing, and product development at a large lighting company. GoodFactories.com is the largest directory exclusively for furniture and home decor manufacturers.















May 29th, 2009 at 6:40 pm
Great article. I would add a couple of things that I find helpful and were proactive. Develop a vendor certification program that profiles the factory, details of manufacturing capabilities, machinery,capacity,quality processes, customer base. This will give you a good indication if the factory is worthwhile pursuing. Next establish your performance standards and develop an evaluation process that that factory must meet minimum standards in order for business to be placed. The evaluation should be performed annually. Nothing beats experience, but having detailed information on a factory and laying out clearly your requirements in advance will go a long way in preventing missteps.
June 5th, 2009 at 9:06 pm
Hi, Pam, good point.
Yes, a vendor certification program, a vendor guide (so the vendor understands exactly how you business), and vendor performance metrics are all very important. I have developed these for our suppliers, and found it really helps add clarity and ease when starting working with a new supplier or training new employees…
Thanks for the comment, and if you would like me to outline any of these let me know, and I can get into more details…
Seth
China Furniture Manufacturers
June 9th, 2009 at 7:44 pm
Having established a W.F.O.E. in 2006, I am now trying to close it, but am told that it can only be closed after 10 years and that the capital I invested into the company cannot be recovered!
In 2006, many of the manufacturers I worked with did not have an export service, so my W.O.F.E. was established to overcome this. In 2009 nearly every manufacturer is exporting.
Does anyone have experience in closing a W.F.O.E. and know if this is the case?
Thanks for any help with this problem.
Geoff
June 11th, 2009 at 1:35 am
Geoff,
I have not heard about this before, it sounds strange… If nobody answers your question by next week, feel free to email me…
seth@goodfactories.com
June 11th, 2009 at 11:26 am
Hi Seth,
No other comments so far, so I will get back to you next week to see if you have any other information.
June 12th, 2009 at 4:26 pm
Did you try to sell your WFOE instead? How much registered capital are we talking about here and what amount are you trying to recover before closing down? There are lawyers around who should be able to get you a deal for your company instead of shutting it down.
June 17th, 2009 at 1:54 pm
Selling the WFOE would be a better choice, but is there a market for established manufacturing WFOE’s that are no longer trading?
The registered capital was RMB500,000 based on the standard requirement.
June 18th, 2009 at 2:29 am
One of my colleages in Shanghai helped close an entity last year. I don’t recall if it was a JV or WFOE. There was a 90 day requirement to post it in the newspaper so creditors could make claims. Also various governmental entities wanted their special reports and audits.
June 18th, 2009 at 10:33 am
Hi Geoff
There is no general requirement that a WOFE should be kept open for a set 10 year period. I am an Irish lawyer working for A Chinese firm and I have seen many WOFE’s wound up after 5-6 years. I have seen one wound up after 1 yesr (although this is not typical). Please feel free to contact me if you need any assistance.
alanmullin@junzejun.com
June 18th, 2009 at 10:45 am
Dan,
Thanks for your input, which does help fill in some gaps. When I can find the complete requirements for this process I will let everyone know.