Story Time
Once upon a time in a magical land of history, culture, riches, eunuchs, opportunity, etc., etc.Story #1. As I was returning from a factory for a US client on Saturday I met another foreign guy that was also returning from a factory visit in Guangzhou. We started talking on the train back to Shenzhen and he told me that he’d been ripped off by some suppliers last year and so decided to take my advice (he attended the Global Sources China Sourcing presentation last year) and visit the factories himself this time.While he was here on the ground and in a few factories he learned a number of important things. First, he found out that his “factory” was really a guy in HK that was charging him about twice as much as he could get it from a real factory source. Second, he found out that another one of his “exclusive” component manufactures was not only not “exclusive, but not a manufacturer either. Third, he was able to test and reject an order that otherwise would have cost him tens of thousands of dollars in bad product and shipping (and return) fees.Moral of the Story? You can pay for QC and information now or you can pay for bad product later—your choice.Story #2. We have a product that was originally supposed to ship the UK on March 15. The lack of returning workers from CNY holiday has extended that date to the 10th of April. When that date was missed but other product was shipped from the factory for other clients we realized that we were not getting the service that we’d been repeated told we could expect.We had, in the spirit of cooperation and understanding, given them more time to finish our order since they honestly didn’t have workers to do the job on time. After the new delivery agreement, like always, we checked up, QC’d, called about worries they would not make the new date and finally when it was clear that they would not finish on time had an argument in the office as to why other product was getting shipped out but ours was not.After about 5 hours of hemming and hawing, the factory finally told us that they didn’t finish our product because the penalties in the other contracts forced them to ship on time or pay for air-freight. We pulled out our contract and pointed to the same line in our agreement and they said: “Yes, but you agreed that we could miss that date so we didn’t think this was urgent.”We hammered out a new agreement, signed it, chopped it and left with a new date and clearer understanding of both “urgent” and “contracts.” As we left my manager said to me: “You were too nice to them. They did that on purpose.”Moral of the Story? Don’t ever break any contracted details yourself or your factory will be more than happy to do it too.Story #3. I enforced some QC standards and helped teach some QC processes to a factory on Monday for an Australian client. The factory is very responsive, had decent product and is more than friendly. But they don’t have great QC and so have a high percentage of rejects on almost every order. They are always willing to re-do product, but the extra time to do this and the additional days of QC gets expensive for them, is time consuming for us and delays delivery for the client.The factory’s solution to this problem was to have us come out earlier in the production cycle to inspect. A great idea if they hadn’t assumed that one visit at 25% was going to be the only visit. How surprised were they when we showed up again at 85% to do QC again! As usual, we rejected a large percentage on both of the first two visits and had to come back the third time--the factory paying for visits 2 and 3. While the product was our first priority, helping the factory improve their processes is an added bonus that helps everyone.Moral of the Story? If one QC visit is good for identifying problems and giving you a heads up before it’s too late, then multiple visits are that much better. QC at 25% is a great idea and I suggest that it’s of much more value that a single day at 100% completion. But IP (In Process) QC is not a replacement for final QC. Ideally you’d have an almost constant presence in the factory. If you can’t do that the next best thing is to be scheduling QC visits at regular intervals—25%, 60%, 90%, for example.Bonus, Moral #2: Work with your factories. Take the time not to just fix the problems with your product but lay out the processes that you've used that they're not getting correct. Take time teach them, not in a condescending way, but with real detail and honest intent to make them better. You'll get better service, better product and better relationships. The factory will get better/more clients and be in business to service your needs longer (and with less worries).