Maybe the offshoring party is coming to an end. Maybe the gravy train of inexpensive goods is rolling to a halt. Whatever your cliché of choice might be, it looks like offshoring production to China to take advantage of extremely cheap labor might not be offering the competitive advantage to American manufacturers that it used to. Say what you will about the fickleness of the American consumer, but when name-brand toy manufacturer Mattel has to recall 20 million dolls and cars and other toys from China for various health and safety reasons, customers are going to think very long and hard before buying another Mattel toy with “Made in China” printed on the box.
A question likely to be asked of U.S. manufacturers for quite some time to come will be: What are you doing to ensure your imports are safe? “Companies must put consumer protection first and above any other motivations,” says Despina Keegan, a senior trade advisor for JPMorgan Global Trade Services. “In the end, we are all consumers and should expect nothing less.” Before the U.S. government comes knocking on your door, Keegan suggests manufacturers evaluate their current business by reviewing this handy acrostic:
IMPORT SAFETY CHECKLIST
I Inspections – Do you inspect your foreign factories (announced/unannounced)?
M Management – Do you have commitment and corporate objectives?
P Policies – Do you have procedures to ensure corporate objectives are followed?
O Origin – Do you identify and verify product origin?
R Recalls – Do you have a program to inform consumers and agencies of defects?
T Testing – Do you test products (internally/externally) and document/track results?
S Suppliers – Do you have quality/safety requirements in writing/acknowledged?
A Audit – Do you have a product safety audit plan?
F Follow – Do you follow or benchmark what your competitors are doing or recommending?
E Examine – Do you examine what’s going on with your product outside the U.S.?
T Training – Do you train internal units and suppliers on product safety?
Y You – Know your product and must exercise reasonable care to protect consumers.