Doing Business in China

China sourcing supplier audits types and how to reduce china sourcing risks

There are fundamentally two types of audits:

Factory Audits which assess the system used by the factory to control quality and run their business.

Social Audits to assess supplier compliance with safety and environmental standards.
Smart China Sourcing: How does supplier auditing help companies to reduce risks in supply chain?

Risk that your factory will not produce the agreed product at the agreed quality, price and lead time.

Risk that your factory will disappear with your deposit or payment.
A factory audit helps to mitigate both risks because a legitimate manufacturer (as opposed to a broker or trading company) is less likely to disappear when there are problems. In addition, a legitimate manufacturer will have a system to control quality, whereas a broker may be here today, and gone tomorrow.

China sourcing supplier audits types and how to reduce china sourcing risks

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