Supply chain auditing is a crucial part of all business operations. If you have suppliers, they are a part of your business and operating inefficiently, have a higher environmental footprint, or treat their workers poorly, which can also reflect on your business. By analyzing and auditing the supply chain structure, you can ensure they show your company’s values and operate on your standards.
Import from China or anywhere in the world will require you to carry out an audit of your suppliers to make sure that they are capable and reliable. It might seem simple, but the process is not easy. Today, you will understand the most important part of supply chain management: supply chain audit.
What is a supply chain audit?
A supply chain audit can thoroughly analyze your suppliers to recognize areas needing improvement. This might include risk management, process, inventory assessment, environmental and social responsibility, supply chain performance, etc. Many kinds of audits can focus on different areas of the supplier chain based on your company’s goals.
If a company wants to reduce its carbon footprint, it will conduct an environmental audit to help analyze the impact of its different suppliers. Suppliers greatly influence the company’s goals and operations; hence, the sustainability audit is essential for all e-commerce businesses that want to improve their operations and help build sustainable business practices.
Which company should get a supply chain audit?
All businesses that have suppliers must carry out a supply chain audit. This report can help you see the current status of the supply chain management, recognize risks, and reveal any weaknesses. Once the issues are highlighted, you can work with the supply chain to make betterments. Not only this, but many certified businesses need a supply chain audit, a crucial part of their certification application process. Some certifications that need a supply chain audit in their supply chain management are ISO 14001, B-Corp and so on.
Why supplier audits are necessary?
Supplier audits check the current situation of the suppliers, find out if they can make the products you need, and reduce your supply chain risk. You may also hire a 3rd party inspection company or another sourcing company that can do this for you.
Auditing suppliers is important when you are sourcing overseas, and you may use many platforms that can help you find suppliers in many cases rather than visiting them on-site, mainly when you want to buy hundreds of products.
But you can’t be sure that these suppliers are as entirely professional as they say they are and can be assured of their qualifications, size, capacity, etc. Hence, at this point, you will need to inspect their production capacity and see whether they can make your products.
Additionally, carrying out vendor audits helps verify their compliance with your goals and reduces the risks of fines, penalties, or reputational damages. This important step in supply chain management can help you mitigate future risks and failures in your business process.
What are the most important factors of the supply chain audit checklist?
Here are some of the top factors you should check for while curating a vendor audit checklist
- Human resources
The supplier should be trained and certified enough. He should be specified in inspections, should have a scope of authorization, staff should have qualifications, and also the period of validity must be defined.
- Requirement and design management
Ensure the supplier can translate the customer’s needs into a world-class product at a good price. Check if the supplier guarantees customer satisfaction. The supplier should also know how customer needs are managed and considered in the final product design.
- On-time delivery ability and processing of orders
This is added to the supplier audit checklist to make sure on-time delivery is possible and to ensure product quality delivery as well. Check how the supplier manages customer satisfaction, buying orders, bills of materials, and revisions of products.
- Purchasing
To ensure that ideal suppliers are picked to supply products and raw materials used for the construction of end products for you, you should make sure all the end products are technical, safe, high quality, and delivered suitably. Check for quality assurance for key suppliers and see how new suppliers are rated in their previous work.
- Inspect incoming products
When inspecting incoming products, you should check the process and procedure, as an early inspection can help form great products. Also, check for tools and skills needed to create the product and see the physical area used for creating products. All of these factors can help decide whether you are going ahead with a reliable supplier.
These are some of the most important factors to consider when picking a supplier and doing supply chain management.
MU Group can help you find the best suppliers possible
MU Group has been renowned for its services to clients in the Western world for over 20 years. It has served its people right and garnered great reviews from customers and clients around the globe. MU Group is located in China and has offices in different regions of the world.
Along with years of knowledge and expertise in the area, professionals at MU Group can help you find the best suppliers in the region. They will deal completely with the suppliers and connect you with the personnel who will bring you the best products and services at ideal prices. MU Group’s professional audit team can visit on-site and chat with the suppliers to help you check their work, background, and company profile so that you can go ahead with the ideally fitting suppliers for your company.
You will be able to examine all the aspects of the suppliers through the MU Group auditors without even having to meet the suppliers in person. The transparency and clarity of professionals from MU group will help you finalize your ideal fit as a supplier of products you need in no time. Hence, soon, you can move to the next step of supply chain management and obtain your desired products and services from China.