Many suppliers failed to pass the factory audit, that they couldn’t reach big brand companies and lost immeasurable value. Besides price and product quality, now factory audit has become a necessary factor in the business. But Why do big brand choose factory audit? You will totally understand through this article.
1. What is the factory audit?
Factory Audit is the last step of the sourcing. Simply put, It is checking the factory.
It requires the on-site evaluation of the plant’s quality system, working environment, production workers and plant capacity. Has ensured that specified suppliers are able to accept specific orders in accordance with customer requirements. Factory audit consists of three aspects:
Factory Audit of Social Compliance Audit
The Social Compliance Audit programs in China focus on the below-mentioned areas namely：
- Child labor laws
- Forced labor
- Disciplinary practices
- Health and safety
- Freedom of association
- Management practices
- Working hours
Factory Audit of Quality Inspection
- Major customers
- Total employees
- Number of quality staff
- Operating time
- Peak production months
- Main products
- Production process
- List of machine
Factory Audit of Security Verification
- Global Security Verification (GSV Audit)
- Customs-Trade Partnership Against Terrorism (C-TPAT) Audit
2. Example of big brand factory audit
In general, large and medium-sized multinational companies have their own corporate codes of conduct. Such as Walmart, Disney, Nike, Carrefour, BROWN SHOE, PAYLESS HOME SOURCE, VIEWPOINT, Macy’s and other European and American countries clothing, footwear, daily necessities, retail, and other groups.
Disney factory audit
Disney has more and more manufacturers in China. In order to better manage these suppliers, Disney requires factory audit. Only when the inspection is successfully passed, can the supplier obtain the order.
Many people have grown up watching Disney’s cartoons since childhood. Therefore, all the major industries involved in Disney have been highly praised by consumers and achieved substantial commercial value. If they do not choose the factory audit, that it is difficult to search and manage many suppliers.
Wal-mart factory audit
Wal-mart inspection standards mainly include wages, working hours and child labor, etc. Wal-mart does not allow child labor.
Wal-mart has a list of inspection. In theory, as long as your factory meets the requirements of the list, it is good. But in practice, your factory cannot meet the requirements of the list. Therefore, you need to find a way to meet the requirements of the list. In addition, the first audit of Wal-Mart only gave the scope without specific details, you must get the yellow light in the first time, otherwise, it will be troublesome.
Carrefour factory audit
Carrefour is the largest retailer in Europe and the second largest international retail chain group in the world. Its factory inspections include corporate legitimacy, child and underage labor, discrimination, working hours, labor remuneration, disciplinary measures, health and safety, and counter-terrorism.
3. Why big brand need factory audit?
Factory audit has also become the standard for big brand companies to assess supplier. Why do they choose a factory audit? We will show you one by one.
Verify supplier capability
Factory audit is to verify the ability of suppliers in the most comprehensive assessment.
Because the brand company’s order is not a little bit, such a large order given to a strange supplier should be very careful. The supplier’s production capacity, production efficiency, and other comprehensive capabilities need to be reflected by an assessment standard. Otherwise, when an order goes wrong, no one can afford it.
Suppliers who pass the factory audit will have the product quality constraint clause, which means that if the supplier’s product quality is not produced according to the expected standard, or how many defective products are produced, the supplier will have to bear the penalty.
In this way, suppliers are aware of the importance you attach to product quality, which can effectively control product quality and reduce losses.
Machine and equipment certification
In addition to listening to the supplier orally explain the machine and equipment, field, professional factory audit will certify that the machine and equipment really exist, meet customer standards, practical and usable.
Since many Chinese suppliers exaggerate the plant’s production capacity and machinery in order to receive orders from customers, the factory audit will have a certification process. Especially for brand companies, the requirements for machinery and equipment are also very high, otherwise, it is difficult to produce products with high efficiency and quality.
Factory audit means that products have passed the human rights guarantee, safety guarantee, and quality guarantee, and customers can safely sell the product to all parts of the world.
Reduce the product due to its own defects brought by consumer complaints, public opinion pressure and pressure of human rights organizations. To bring a sense of security to the brand, reduce negative effects, to establish brand prestige and bring more trust to consumers.
Easy to manage your own suppliers
There are many suppliers of brand companies, how to manage these suppliers needs a standard, factory audit is a good evaluation method.
Many brand companies, such as large companies in Hong Kong, will first ask whether they have a factory audit report or conduct factory audit when they are looking for suppliers. Only those who pass the test can become suppliers. Secondly, the approved supplier will also have a very detailed report covering all aspects of the factory for customers to backup and consult.
Increase the autonomy and self-discipline to abide by local laws and regulations
Consciously abide by the local laws and regulations, in order to ensure that all work smoothly.
Voluntary compliance with the law improves the overall level of management and competitiveness.
Improve work efficiency
The factory audit limits the working time and the output of the factory, which strictly guarantees working efficiency.
Many Chinese factory workers are lazy and idle, which greatly affects their work efficiency. The implementation of factory audit ensures the smooth progress of orders, especially for brand companies with large quantities of goods and tight delivery time, which need to strictly control the production schedule
4. List of factory audit companies
The following are the factory audit companies we provide to you to help the factory’s competitiveness and get more orders.
- InTouch Manufacturing Services
- Bureau Veritas
- Asia Quality Focus
5. RunSourcing agent can help you arrange factory audit:
Now, in addition to brand companies, more and more customers choose factory audit to ensure their own interests, to ensure the smooth and high quality of orders in China. We are willing to arrange a factory audit and all the other things for you.
Runsourcing is a China sourcing agent, we provide one-stop service, sourcing supplier–factory audit—sign the contract–quality inspection—shipment, We will help you process everything that you import from China!
Hope this article will help you and we will continue to update more on this topic. If you want to know more information about importing from China, you can go to our blog page, https://www.runsourcing.com/blog-home/. There must be one thing you need. We are a professional agent in China and have been working in the B2B field for 10 years.