Case Study:  A Global Packaging Supplier Fortifies Supplier Relationships with Robust Quality Control 

Background: 

When sourcing products overseas, building long-term partnerships with quality suppliers can provide a strong foundation for a sustainable, thriving supply chain.  Managing these relationships from afar often requires a significant investment of time and resources.

After establishing a foundation of trust over time through long-term collaboration and a consistent schedule of orders, one global packaging supplier began to notice the quality of their merchandise began to slip.

Challenges: 

• They did not want to abandon their current suppliers to begin establishing new relationships but lacked the physical presence to provide the necessary oversight to fix the issues.
• Over time, price benchmarking was needed to ensure they were receiving a fair price relative to the market.

CPG’s Beijing-based team was commissioned to manage and fortify supplier relationships.  After introducing CPG to their existing supplier network, the following solutions were implemented within 2 months:

• CPG Quality Assurance (QA) engineers analyzed physical products and developed detailed Product Specification Sheets (PSS) and quality standards for each item
• Conducted in-person factory inspections on each order resulting in a detailed inspection report for each
• Established rigorous quality control procedures through Inspection Specification Sheets (ISS) for each item 
• Managed  dynamic  shipping schedules  and implemented  timely in-person inspections that enabled correcting  defective products before shipment
• Explored potential new suppliers through an extensive price-benchmarking process. 

Results:

• 90 Products analyzed: CPG created Product Specification Sheets and Inspection Specification Sheets for over 90 different items across 3 different suppliers within 6 months of being commissioned
• 110 in-person inspections performed (in 2022) 
• 70% of product inspections passed; 30% of product inspections failed (products needed corrections before shipment) 
• Fortified supplier relationships through collaboration on strict, well-defined quality control procedures

Conclusion:  

Creating and implementing a rigorous quality assurance program produced precisely the results desired from the outset. This innovative company was able to not only maintain but enhance its relationship with its trusted partners, optimizing costs and reducing waste from unsupervised shipments.

Lessons Learned:

• Maintaining partnerships with existing suppliers requires more than trust and collaboration; having an in-market, experienced team to leverage for QA oversight and price bench-marking improves efficiency and reduces cost.
• Many suppliers want to maintain their relationships with buyers but lack the insight and communication skills to improve their processes.
• Effective QA programs require more than randomized inspections.  Detailed documentation of PSS and ISS creates a repeatable, sustainable process.