1. China–United States trade war
‘Made in China’ products used to have a negative connotation when it comes to product quality. That has surely become a thing of the past. Compared to other South-East Asian manufacturing countries, China is the go-to-country for more complex products, with more qualitative results.
But that was before the China-US trade war happened. It all started in 2018 when US President Donald Trump started setting tariffs and other trade barriers on China, with the goal of forcing it to make changes to what the U.S. says are “unfair trade practices”.
The result is that many US brands are shifting their supply chains outside of China – if they hadn’t started doing so already. And those who are staying, are putting even more pressure on their Chinese suppliers’ prices, to make up for the loss of margin caused by the tariffs. And we all know what happens when you put pressure on suppliers… A decrease in quality and a decline in CSR.
2. Demand for more transparency
Shoppers are increasingly demanding more transparency and a closer connection to the stuff they buy. They are demanding to know much more about where and how items are made, and pay closer attention to the quality of the products. Brands can’t ignore this call for more transparency and are obliged to respond to their customers’ demands by creating more visibility into their supply chain and by taking measures to improve their products’ quality. And if brands really want to get ahead of their competition, they should already be thinking about the next step and educate their consumers instead of just responding to their demands.
3. Stronger brand-supplier collaboration
Another result of these increasing consumer demands, is an improvement in brand-supplier relationships. If brands want to have more insights into their supply chain, they need to build relationships with their suppliers that are based on trust and collaboration.
At the same time, factories, from their side, also need to open up and be more transparent about their way of working. Only then will brands be encouraged to build long-term relationships, which will ultimately lead to better working conditions for the factory staff, better-quality products for the consumer, and a stronger reputation for the brand.
4. More self-inspection and self-audits
Better brand-supplier collaboration means less need for control. That’s why many factories now have a dedicated team of quality inspectors and factory auditors. This is beneficial for the brands, because they don’t have to send their QC inspectors to far-away factories. But it is equally beneficial for the factories, who get a better insight into their quality issues and take that knowledge to improve their internal workflows and product quality.
5. Quality & compliance digitization
The only way to create transparency in your supply chain, is by capturing data throughout the process. Data is knowledge, and knowledge is the first step to improvement. Only by capturing data, can quality problems be traced back and dealt with in order to avoid reoccurrence.
By digitizing quality inspections and factory audits, everyone in the supply chain gets a clear overview of what is happening, in real-time. Delays can be avoided, problems can be dealt with immediately, and the analytics offered provide a valuable foundation for future improvement.