China Inspection Company: Has Yours Got a “Conflict of Interest”?

One of the tips you have often read in this blog is “you need to visit the factory and, if you can’t do it, you need an inspection company to visit it for you”.  I’ve repeated this one through different stages of the supply process (when you are selecting your supplier, through the product development process, during production, for quality control purposes…)

Today I was reading about this same topic at the Quality Inspection Tips blog. Renaud Anjoran  has written a post with tips on “How to Choose a Quality Inspection Firm”, based on an article at Pro QC International  Newsletter entitled Controlling Quality Worldwide- Without Leaving your office”.

I recommend reading both of them to get some insights on how to choose the right inspection company.

Michael L. Hetzel – Vice President / Americas, Pro QC International adds in the original article an interesting angle. Had you realized that your inspection company may have a conflict of interests?
These are the two “watch-out” remarks Mr Hetzel makes:

1. They may be the company that has qualified your supplier as ISO9000 or other quality standard
“A number of companies offering third party inspection services are also ISO9000 or other quality standard registrars. This can be a non-issue for the most part, or a liability if a vendor being qualified has been registered by that company, creating a conflict of the “of course they’re qualified, we registered them” type.”

2. They may not be a real 3rd party, but work also for the supplier.
“Another potential conflict of interest lies with companies that are not truly “third party,” who work for the supplier rather than the buyer. You’ll want a company who only works for you conducting these activities, or you may as well return to reliance on the seller’s assertions of quality and conformance and save the service costs“


Have you found yourself in this situation?
Do you agree with this view?

2 comments

  1. Actually I have not mentioned Mr. Hetzel’s remarks about conflicts of interest because I don’t think importers should be concerned about this point.
    Re: the ISO9000 registration: I agree that ordering a factory audit from SGS on a factory that claims to be ISO9000 certified by SGS does not make sense. But I don’t think it has any importance for product inspections. In Chinese factories, there are maybe 100 inspections for every audit…
    Re: the “third party” thing: in theory, a real third party does the job, regardless of who pays for it. If a factory wants to pay for an external QC inspection because they really want to avoid any quality issue, why refuse it? Of course they might set the tolerances for defects looser than usual, and show the passed report to an ignorant importer. But, as long as these tolerances are clearly displayed in the report, I don’t see any conflict of interest.

  2. We use 3rd party inspection companies in China but we always hire a 4th party inspection company to monitor/audit the 3rd party. After all, it’s China and we all know how things really work in China. If you don’t, you have no business being there!