An Overview of Inspection Service Date : Nov. 23, 2005 Speaker : Leo CHOI Sales & Marketing Manager KEMA Quality Hong Kong Ltd.

Objective To introduce inspection service to emerging SME which have increasing needs to comply with the different inspection requests from their international buyers.

Quality Control Laboratory Testing Inhouse laboratory External International Laboratory Physical Inspection Inhouse QC team External International Inspection company

Consumer Products Inspection Electrical Products (household appliances etc.) Electronic Products (electronic toys etc.) Hardgoods (household products etc.) Softgoods (garments etc.) Fabric

Why Inspection International trade between buyer & seller Buyer ensures product quality comply with contractual specifications Buyer ensures manufacturer comply with social accountability (Code of Conduct)

Who do the Inspection First party (by factory) Second party (by buyer) Third party (by inspection company, independent company)

What is Inspection Factory Audit (Vendor Assessment) During Production Inspection (Durpro) / Inline Final Random Inspection Loading Supervision

Factory Audit Verify if factory comply with technical & social requirement Compose of technical & social audit (code of conduct) Technical audit on Incoming Quality Control (IQC), Production line, any Sub-contractor, QC team, Store room etc. Social audit on how labour is treated, any child labour, working hours, pay, dormitory, toilets, freedom of trade union etc. Audit Report of different sections, weighted average to a Total, Pass / Pass with Correction needs / Fail

Inspection Method Inspector uses AQL (Acceptance Quality Level) to select a sample size Within sample size, check for Critical defect – endanger life of consumer e.g. sharp edge Major defect – defect easily spot out in a selling place Minor defect – defect NOT easily spot out in a selling place

Inspector Level & Acceptance Criteria The higher the AQL level, the bigger the sampling size, more demanding The higher the acceptance criteria, more defect is allowed, less demanding Most commonly used is Level II, major 2.5, minor 4.0 Most expensive / quality conscious products, major 1.5, minor 2.5 Large volume and less expensive products use Level I

Inspector checks in the sample size Packaging and Packing Information Barcode scanning Functional check Additonal tests like drop test, Hi-pot test etc.

Inspection Result If critical defect >0, fail If (major & minor) defects < tolerance level, pass If (major & minor) defects > tolerance level, fail If (major & minor) defects = tolerance level, pending

During Production Inspection / Inline When products are produced in an initial stage (e.g. 15% - 20% of whole lots produced) Verify if products comply with contractual requirements Take corrective action on the goods if necessary Use AQL to select sample size Check total number of defects found

Final Random Inspection Most common type of inspection When goods are at least 80% produced or more Use AQL to decide sample size Check total number of defects found Issue inspection certificate if result is pass Inspection certificate link to Letter of Credit

Loading supervision Witness loading of goods into a container (no checking of qualtiy) Randomly open a few cartoons to make sure the right products are loaded Take photos throughout the whole process in a report

Conclusions Inspection result as a reference Shipment control in the hands of buyer and factory Pending results for buyer to decide Inspection company as an independent body Factory prepared by asking for a checklist Quality of the products for long term relationship with buyer

End of Presentation Thank you