Successfully reported this slideshow.
We use your LinkedIn profile and activity data to personalize ads and to show you more relevant ads. You can change your ad preferences anytime.

AsiaInspection Q3 Barometer: Quality, Safety, Ethics: Supply Chains Still Struggle in 2017

2,252 views

Published on

The first half of 2017 shows that safe and ethical manufacturing is still a long way down the road for global supply chains, while lab tests reveal alarming frequency of chemical non-compliance. Read more in AI’s Q3 barometer

Published in: Business
  • Be the first to comment

  • Be the first to like this

AsiaInspection Q3 Barometer: Quality, Safety, Ethics: Supply Chains Still Struggle in 2017

  1. 1. QUALITY, SAFETY, ETHICS: SUPPLY CHAINS STILL STRUGGLE IN 2017 ASIAINSPECTION Q3 BAROMETER
  2. 2. HONG KONG, JULY 6, 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 Q3 Barometer, a quarterly synopsis on outsourced manufacturing and the quality control services industry.
  3. 3. GLOBAL SOURCING TRENDS: CHINA KEEPS UP GROWTH PACE, REGIONAL COMPETITION NOT FAR BEHIND +10.4%VIETNAM +25.4%CAMBODIA +15%CHINA SOUTH AFRICA +7.7% YEAROVERYEARGROWTH
  4. 4. 2017 IS PROVING CHALLENGING TO ETHICAL COMPLIANCE AND STRUCTURAL SAFETY Share of fully compliant (“Green”) factories dropped to 27.5% (vs. 34% in 2016) Critical non-compliances were found in up to 32.5% factories Average ethical scores dropped to 7.5 out of 10, from 7.9/10 in 2016 Lowest scores awarded on the criteria “working hours and wages” and “waste management” 32.5%offactorieshadCritical non-compliances
  5. 5. LESS REGIONAL VARIANCE IN ETHICAL COMPLIANCE SOUTHEAST ASIA 8.6 * * 9% improvement on 2016 CHINA 7.6
  6. 6. ETHICAL COMPLIANCE TRENDS BY INDUSTRY BEST ETHICAL SCORES IN Q2 2017 E&E 8.2/10 LOWEST ETHICAL SCORE IN Q2 2017 Toys and Juvenile Products 7.2/10 PROMINENT NEGATIVE TREND Textile from 7.8/10 in 2016 to 7.2/10 in 1H 2017 Cross-industry average 7.5/10
  7. 7. UNEVEN PROGRESS IN STRUCTURAL SAFETY Share of compliant factories up 3.5 pts : 36.5% in Q2 2017 vs. 33% in 2016 Remediation underway, but not complete in 59.5% factories Up to 4% of facilities still have immediate safety risks
  8. 8. COMPLIANCE IN LAB REMAINS CHALLENGING FOR US AND EU IMPORTERS STATE OF SHIPMENTS TO THE US AND EU 13% products contained lead 9% lots contained banned phthalates REACH COMPLIANCE (EU) 11.5% products failed lab tests 13%of products containedlead
  9. 9. MECHANICAL HAZARDS: A MAJOR REASON FOR PRODUCT RECALLS Recalls for choking hazard and small parts frequent in Q2 2017 High failure rates for mechanical compliance lab tests: 10% of shipments 7% of shipments 10%of shipment to the US failed
  10. 10. PRODUCT QUALITY IN FACTORY: SLOW IMPROVEMENT IN THE LONG TERM * down 4 points YoY
  11. 11. MANUFACTURING QUALITY TRENDS BY REGION South Asian manufacturers improve on last year, but rejection rates still 50%+ in major sourcing hubs: Bangladesh: 53.9% Pakistan: 50.5% India: 49.3% China continues trend for gradual improvement: 31% Beyond AQL in 1H 2017, vs. 33% in 1H 2016
  12. 12. PRODUCT QUALITY BY INDUSTRY STILL VARIES Textiles in the lead for quality failure: 40% products Beyond AQL in Q2 2017 Accessories and Eyewear quality trend flat around 20% and 13% Beyond AQL Toys and Juvenile Products, E&E: down 2 points vs. 2016 Beyond AQL values, to 29% and 25% respectively
  13. 13. www.asiainspection.com info@asiainspection.com facebook.com/asiainspection twitter.com/asiainspection linkedin.com/company/asiainspection   

×