Quality Fade, the process of quality degradation over time, is the single biggest issue in low cost manufacturing countries. It happens frequently in China where manufacturing processes are immature and competitive pricing drives the profits to extremely low levels. It also happens in Vietnam, Indonesia, Bangladesh and other low-cost countries.
You have probably noticed quality fade, but didn’t know what to call it, or understand how it happened. Maybe you noticed a plastic shampoo bottle that seemed too thin. Maybe that hand-held electronic game you put in your son’s Christmas stocking stopped working after a few days. Maybe the zipper in your pants broke after a few zips.
Quality fade is a particular problem for products coming from China, where nearly 40%of the world’s production now takes place. This startling fact about the tremendous volume of goods produced in China is evidenced at the drug store, department store, big box retailer and the grocery store. The ubiquitous “Made in China” label can be found everywhere. These products are initially equal or superior in quality to Western-made goods, but over time, quality begins to fade. Sometimes poor quality is just an inconvenience and sometimes it is downright dangerous.
Products manufactured or assembled in low cost countries, aren’t designed to break or poison anybody. In fact, typically when a new contract is signed and specs are given for initial production at a new supplier, importers of Chinese goods are thrilled. The vendor’s service levels are outstanding, the quality is above expectations and the future looks bright. Customers are pleased with the price of initial production, and they assume that it will last. New importers feel like they’ve hit a home run with low-cost country sourcing.
Don’t be fooled! The initial production runs are often not sustainable. Over time, degradation in quality is likely. For example, the label on your product becomes 10 percent smaller, your 100 ml product may actually be 99 ml, non-toxic paint you specify for toys may become fast-drying lead paint, the 5/8 inch seam may become 3/8 inch.
You may think you have negotiated a spectacular deal, but when negotiating in China, you may not have all the facts.