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2016 IN REVIEW: WORRYING TRENDS
FOR QUALITY AND COMPLIANCE ACROSS
GLOBAL SUPPLY CHAINS
ASIAINSPECTION Q1 BAROMETER
HONG KONG, JANUARY 5, 2017
ASIAINSPECTION (AI)
A LEADING GLOBAL QUALITY CONTROL AND COMPLIANCE SERVICE PROVIDER
THAT PARTNERS WITH BRANDS, RETAILERS AND IMPORTERS AROUND THE WORLD
TO SECURE, MANAGE AND OPTIMIZE THEIR SUPPLY CHAIN
today announces its 2017 Q1 Barometer, a quarterly synopsis
on outsourced manufacturing and the quality control services industry.
SOURCING GEOGRAPHIES: CHINA
REBOUNDS, SOUTH ASIA SURGES
+18.2%PAKISTAN
+12.5%CHINA
+11.7%BANGLADESH
+5.0% VIETNAM
YEAROVERYEARGROWTH
SUPPLY CHAIN SUSTAINABILITY:
STRUCTURAL SAFETY STILL A MAJOR ISSUE
63% of audited factories found in need of remediation
Critical issues found in 3% factories
Number of compliant factories dropped from 41% to 37% YoY
63%in need of
remediation
PROGRESS SLOW IN ETHICAL COMPLIANCE
Less than a third of factories found compliant
27% of factories had critical non-compliances
Top concerns in ethical compliance
Forced labor
and child labor
Sexual
harassment
Exploitation
of refugees
ENVIRONMENTAL COMPLIANCE
STILL A STRUGGLE
36% of environmental audits failed in 2016, compared to 31% in 2015
Many brands find ISO 14001 commitment challenging and struggle even
with much lower statutory minimum requirements
36%failed in 2016
MORE BRANDS SEEK TO EDUCATE
SUPPLIERS AND IMPROVE AWARENESS
AI has seen strong demand for workshops and trainings in 2016
Structural safety and environmental compliance education
in most demand
PRODUCT MANUFACTURING QUALITY:
WORRYING RESULTS OVERALL
Consumer goods quality worldwide has deteriorated in 2016
AI data shows a 2.9% increase in product inspection failure rates
in 2016 vs. 2015
+2.9%2016 vs. 2015
CONTRASTED QUALITY TRENDS THROUGHOUT ASIA
Vietnam shows a
small improvement,
driving Beyond AQL
rates down to 29%
Product quality in
China remains stable,
with failed inspections
around 32.4%
India, Bangladesh,
Pakistan show
double-digit growth
in inspection
failure rates
PRODUCT QUALITY: INDUSTRY BREAKDOWN
Textiles most prone to
quality problems: 41.6%
products beyond AQL
Toys & Juvenile Products
quality slightly improved
by 3 points, to 30.3% of
rejected inspections
LAB TESTS SHOW IMPROVEMENT
IN PRODUCT SAFETY
Failure rates for lab tests at 3.3% in 2016,
improvement by +11.4% compared to 2015
3.3%failed in 2016
SPECIFIC TEST RESULTS
REMAIN MORE DISPARATE
REACH-related tests: failure rates tripled YoY
Phthalate tests: 5.4% products fail safety requirements
x3
REACH FAILURE RATE
5.4%
FAIL PHTHALATE
TESTS
AsiaInspection (AI), a leading global quality control
and compliance service provider
that partners with Brands, Retailers and Importers around the world
to secure, manage and optimize their supply chain.
ABOUT ASIAINSPECTION
YOUR EYES IN THE FACTORY!™
ABOUT ASIAINSPECTION
YOUR EYES IN THE FACTORY!™
DEDICATED ACCOUNT MANAGER
A supply chain partner
offering advice on your specific needs
INDUSTRY LEADING TURNAROUND
Onsite within 48 hours.
Reports the same day 80% of the time
COMPREHENSIVE ONLINE MANAGEMENT
Use your real-time dashboard
to benchmark and identify
your high performing suppliers
FLEXIBLE
Cancel or modify orders up to 4pm
the day before the inspection for free
PRODUCT EXPERTISE
Hundreds of off-the-shelf customizable
product specific checklists
TRUSTED AND TRULY INDEPENDENT
100% QC. AI is not involved in sourcing
and protects your factory information
MOBILE
Book, check reports
and make decisions on the go
ALL-INCLUSIVE PRICING
Easy to budget. No hidden costs

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AI Q1 Barometer: 2016 in Review - Worrying Trends for Quality and Compliance across Global Supply Chains

  • 1. 2016 IN REVIEW: WORRYING TRENDS FOR QUALITY AND COMPLIANCE ACROSS GLOBAL SUPPLY CHAINS ASIAINSPECTION Q1 BAROMETER
  • 2. HONG KONG, JANUARY 5, 2017 ASIAINSPECTION (AI) A LEADING GLOBAL QUALITY CONTROL AND COMPLIANCE SERVICE PROVIDER THAT PARTNERS WITH BRANDS, RETAILERS AND IMPORTERS AROUND THE WORLD TO SECURE, MANAGE AND OPTIMIZE THEIR SUPPLY CHAIN today announces its 2017 Q1 Barometer, a quarterly synopsis on outsourced manufacturing and the quality control services industry.
  • 3. SOURCING GEOGRAPHIES: CHINA REBOUNDS, SOUTH ASIA SURGES +18.2%PAKISTAN +12.5%CHINA +11.7%BANGLADESH +5.0% VIETNAM YEAROVERYEARGROWTH
  • 4. SUPPLY CHAIN SUSTAINABILITY: STRUCTURAL SAFETY STILL A MAJOR ISSUE 63% of audited factories found in need of remediation Critical issues found in 3% factories Number of compliant factories dropped from 41% to 37% YoY 63%in need of remediation
  • 5. PROGRESS SLOW IN ETHICAL COMPLIANCE Less than a third of factories found compliant 27% of factories had critical non-compliances Top concerns in ethical compliance Forced labor and child labor Sexual harassment Exploitation of refugees
  • 6. ENVIRONMENTAL COMPLIANCE STILL A STRUGGLE 36% of environmental audits failed in 2016, compared to 31% in 2015 Many brands find ISO 14001 commitment challenging and struggle even with much lower statutory minimum requirements 36%failed in 2016
  • 7. MORE BRANDS SEEK TO EDUCATE SUPPLIERS AND IMPROVE AWARENESS AI has seen strong demand for workshops and trainings in 2016 Structural safety and environmental compliance education in most demand
  • 8. PRODUCT MANUFACTURING QUALITY: WORRYING RESULTS OVERALL Consumer goods quality worldwide has deteriorated in 2016 AI data shows a 2.9% increase in product inspection failure rates in 2016 vs. 2015 +2.9%2016 vs. 2015
  • 9. CONTRASTED QUALITY TRENDS THROUGHOUT ASIA Vietnam shows a small improvement, driving Beyond AQL rates down to 29% Product quality in China remains stable, with failed inspections around 32.4% India, Bangladesh, Pakistan show double-digit growth in inspection failure rates
  • 10. PRODUCT QUALITY: INDUSTRY BREAKDOWN Textiles most prone to quality problems: 41.6% products beyond AQL Toys & Juvenile Products quality slightly improved by 3 points, to 30.3% of rejected inspections
  • 11. LAB TESTS SHOW IMPROVEMENT IN PRODUCT SAFETY Failure rates for lab tests at 3.3% in 2016, improvement by +11.4% compared to 2015 3.3%failed in 2016
  • 12. SPECIFIC TEST RESULTS REMAIN MORE DISPARATE REACH-related tests: failure rates tripled YoY Phthalate tests: 5.4% products fail safety requirements x3 REACH FAILURE RATE 5.4% FAIL PHTHALATE TESTS
  • 13. AsiaInspection (AI), a leading global quality control and compliance service provider that partners with Brands, Retailers and Importers around the world to secure, manage and optimize their supply chain. ABOUT ASIAINSPECTION YOUR EYES IN THE FACTORY!™
  • 14. ABOUT ASIAINSPECTION YOUR EYES IN THE FACTORY!™ DEDICATED ACCOUNT MANAGER A supply chain partner offering advice on your specific needs INDUSTRY LEADING TURNAROUND Onsite within 48 hours. Reports the same day 80% of the time COMPREHENSIVE ONLINE MANAGEMENT Use your real-time dashboard to benchmark and identify your high performing suppliers FLEXIBLE Cancel or modify orders up to 4pm the day before the inspection for free PRODUCT EXPERTISE Hundreds of off-the-shelf customizable product specific checklists TRUSTED AND TRULY INDEPENDENT 100% QC. AI is not involved in sourcing and protects your factory information MOBILE Book, check reports and make decisions on the go ALL-INCLUSIVE PRICING Easy to budget. No hidden costs