One of the things we are always telling our clients who source product to China is to be specific. Always. I talk about how China has levels of quality five levels below anything you would even think possible and for Chinese manufacturers, those levels are normal.
I mention how you can buy shirts (unbelievably cheaply) in China that are pretty much ruined after one washing. I tell them of the company that sought our assistance after receiving USD $500,000 of computer bags whose handles broke pretty much every time they were used to tote a laptop. Or I tell of the company that contacted us when its massive order of Christmas tree lights would not be delivered until mid-December. In both cases, I blamed the US companies for having failed to be specific. In the laptop bag case, the Chinese manufacturer essentially said that if the US company had wanted the bags to have been strong enough to hold a laptop, they should have paid more for them.
I talk about the US company that came to us after discovering its Chinese manufacturer was selling its rejected and unsafe product around the world and had no legal basis to stop this. It had no legal basis to stop it because it had no trademarks in the key countries and because its OEM contract failed to require rejected product be destroyed.
I thought of all those things today after reading “Documents Unsealed in Chinese Drywall Lawsuit.” The article’s first paragraph says it all:
Knauf Plasterboard Tianjin Co. LTD, a major Chinese drywall manufacturer, urged one of its main U.S. customers, Banner Supply, to sell thousands of sheets of foul-smelling drywall “overseas” after Banner complained about the tainted product, according to documents and depositions unsealed Friday by a Florida circuit court judge in Miami-Dade County. A Banner executive said the offer was refused.
If you are a Western manufacturer outsourcing to China and you get bad product, the first thing the Chinese manufacturer usually suggests is that the product is good enough. When that does not work, the Chinese manufacturer usually then suggests you simply sell it for less. When that also does not work, the next suggestion is usually for you to sell it somewhere other than in the United States.
The best way to avoid these sorts of problems is to always be clear on your quality standards and on the penalties the Chinese manufacturer may face for not meeting them. It is not really this simple, but this is the minimum you must do if you are to have a shot.
For more on what should go into your China OEM Agreement, check out the following:
– China OEM Agreements. You Are Naked Without A Good Bill Of Materials
– Why You MUST Have A China OEM Agreement
– China OEM Agreements. Why Ours Are In Chinese. Flat Out.
– China OEM Agreements: Ten Things To Consider.
For more on maintaining quality control with your China-made products, check out the following:
– China Product Quality. What It’s Gonna Take.
– Outsourcing in China: Five Legal Basics For Reducing Risk.
– How To Handle Bad Product From Your China Supplier.
– The Six (Not Five) Keys To China Quality.
– Six More Keys To Quality Product Made In China.
