Factory Audit: Important Step in Sourcing Process!

As the world becomes global market, it should come as no surprise that export and import, both have gained importance over this period of time. The factories producing goods need to assure that the quality of their goods never falls down the set standards. The goods are rejected if their quality doesn’t meet the requirements of the importer.

In order to keep a check on this, factory audits at several levels were executed. A few companies have set up local offices to conduct factory audit while few others acquired large companies to organize their supply chain as per their needs. Recently, quality control is practiced to find out the defects by sampling method. The customers who purchase products want to know the product they are buying has been produced in a responsible and ethical way. They look for trustworthy and responsible sellers who offer them quality products. This makes factory audits more necessary.

• Identification- Searching for the potential suppliers for your business on directories, trade shows, etc.
• Screening- Shortlist the incapable suppliers by a questionnaire to a bunch of three or four.
• Verification- Conduct factory audits to assure that the selected suppliers will fulfill the quality demands.

Factory audits are the last step in the sourcing process and it takes place usually after a group of potential suppliers have been screened down to a few serious candidates. It is not only the most expensive but also the most depth form of supplier evaluation. It helps you to monitor your supply chain while heading towards the global market, have accurate reports that enforce timely decisions and minimize risks.

Benefits of factory audit:

• To ease the burden facing multiple audits, questionnaires and certifications.
• To drive ethical improvements in global supply chains and encourages progress.
• To easily access the audit report and share information of your working groups on supply chains.
• To enable the approval of the factory where production will take place.
• To ensure that the factory will deliver the right product at the right time.

Low cost factory audits have emerged as a good alternative to the time intensive process. As businesses are expanding their global footprint, they have shifted to sourcing from emerging markets. This increases the need for factory audits, which would be very costly for a single organization to carry out. They can either perform the onsite audit to check if implementing supply chain security policies and procedures effectively or not. Or they can switch to an audit network that provides a systematic approach and reduce the audit costs while maintaining confidentiality.

As competition grows, the need for factory audits has also risen. The supply-chain is built on strong partnerships and trust. It is necessary for the suppliers to ensure quality check before they supply their product to the demanding store. All in all, factory audits are an excellent means to minimize environmental damages due to use of machines and sustainable improvements in production.