A quality audit is a procedure in which a team of auditors, either internal or external, thoroughly examines a quality system. It is a key component ...
Third-Party Quality Companies To Check Verified Suppliers
By AMREP | Posted on March 30 , 2022
Updated on December 12, 2023
Online supplier directories and B2B marketplaces like Alibaba, Global Sources, IndiaMart, DH Gate, and HKTDC have made finding suppliers much easier by placing the world’s suppliers at your fingertips. No matter what you want to be made, there’s a supplier for it somewhere in the world – and you get to shop for the cheapest option too. All you have to do is to sit at your computer and do a lot of trawling through the Internet.
- How Do You Choose High-Performing Suppliers?
- Supplier Verification – The Solution?
- Tips For Selecting A QC Company For Supplier Evaluation
How Do You Choose High-Performing Suppliers?
Having so many options to buy from has made matters extremely confusing. All the suppliers say the same things – they post photos of perfect products and immaculate factory premises, and they say that they have millions in annual revenue, hundreds of employees, QA departments, and service the European and North American markets.
How do you tell which are the high-performing suppliers, the ones that you can trust and rely on? Which ones are the fraudsters and scammers? One solution to this is you can get supplier management services from a third-party QC company.
Supplier Verification – The Solution?
Some of the buyer-supplier platforms have introduced their own supplier verification systems. Alibaba offers a trade assurance program where you have suppliers that have been verified by Alibaba and/or a third-party company.
These programs cannot give you the answer to your questions. Here’s why:
Verification confirms the existence of the business, but even this cannot be fully relied upon.
Supplier verification tends to focus on checking the company’s business registration details. But business details can be falsified.
In 2011, Alibaba's CEO David Wei and COO Elvis Lee both had to resign after an internal probe found that employees had knowingly allowed fraudsters to evade the company’s authentication and verification measures and set up fraudulent storefronts.
Verification procedures only serve the financial interests of the suppliers and online marketplaces
The online marketplace needs suppliers to list themselves and needs customers to feel that they can trust the marketplace. Suppliers need customers to believe in their business. It is in the supplier’s and marketplace’s interests to say that they are verified as it is good for business.
Need help finding the best supplier?
Tips For Selecting A QC Company For Supplier Evaluation
Bring in the quality company
The way around all these problems is to visit the supplier yourself or hire a third-party quality inspection company to evaluate the supplier for you. The upside is that you’ll be getting a professional who’s acting in your interests, has production knowledge, and understands supplier behavior.
Here are some tips for selecting a Quality Control Company:
- Quality inspection is a very competitive industry and in places like China, companies fight for the customer’s attention by undercutting one another’s prices. The game is about who can offer the lowest price. But the only way that these prices can be achieved is to make extreme comprises that ultimately mean compromises in your quality. A price that is too low should be scrutinized very closely. You get what you pay for.
- Quality inspection companies can actually be spin-offs by the supplier. Suppliers will do anything to survive and it is their objective to get those goods, defective or not, out of the door. Rejects and rework mean more costs for them. Suppliers may get people who are friendly to their interests, like former employees or customers, to form a quality company and use that as the ‘third party to pass their products. Usually, the former employees or customers will be shadow directors or owners.
- Quality inspection companies may use temporary staff who have very basic skills and have no quality control knowledge to do the product inspections. There are a couple of warning signs you can look out for, one is the cost of the inspections (as discussed earlier) and the second is if the inspection company says that they don’t use the same inspector for repeat jobs to ‘reduce the possibility of corruption. This is a very strong indicator of a high turnover and casual workforce that work on an on-call basis.
To select the right company, the easiest way is to pick up the phone and try to speak to someone. You learn a lot just from the way the person speaks to you.
Ask them lots of questions about their personnel and the customers they serve, see if you can interview the inspector, and make sure that the person is familiar with your product.
We would also recommend doing your own research on quality inspection companies and not relying entirely on what’s listed on online supplier marketplaces.
Don't Forget to Share This Post
Supply chain management (SCM) is the process of planning, measuring, and monitoring the flow of goods and services from the suppliers to the end customer...
AMREP Supplier Management Services is back again working in the Defense Electronics industry. Previously our work was on night vision ...