Factory audit: what to check before you order

What an audit is actually for

An inspection tells you whether this batch is right. An audit tells you whether this factory is capable of getting batches right repeatedly. They answer different questions, and passing one says very little about the other.

You audit before you commit: before tooling, before a large first order, before making a supplier the single source for something you depend on. Auditing after a failure is useful too, but by then you are paying for the information twice.

Is the company what it says it is

Start with the legal identity. The business licence, the unified social credit code, the registered scope of business, and whether the registered name matches the entity you are contracting with and the bank account you will pay. Check it against the National Enterprise Credit Information Publicity System at gsxt.gov.cn rather than accepting a document at face value.

Confirm they hold export rights or understand who will be exporting on their behalf, because a factory that cannot export ships through an agent whose name will appear on your documents.

And establish whether the site you are visiting is the site that will make your goods. A group with several plants may quote from one and produce at another, which is not sinister but changes everything you are about to assess.

Capability and capacity

Look at the equipment that will make your product specifically, not the impressive machine near the entrance. Ask how many of your units they can produce per day, how many shifts they run, and what proportion of capacity your order represents. Too large a proportion is a risk; too small and you may be a low priority when a bigger customer needs the line.

Ask what they already make that is closest to your product, and ask to see it. Adjacent experience is worth more than a general claim of capability.

Look for work in progress rather than a spotless empty floor. An audit visit that has been prepared for tells you less than an ordinary working day does.

Process control and the quality function

Ask to see the incoming materials check, the in-process checks and the final inspection, and ask who does them. The critical question is whether quality control reports to production, because a quality function that reports to the person responsible for hitting the shipping date will lose that argument regularly.

Ask how a defect is recorded, who is told, and what happens next. Look for evidence rather than description: records, tags on rejected material, a quarantine area that actually contains something.

Look at calibration of measuring equipment, and at whether there is any test capability on site relevant to your product. For regulated goods, ask which tests they can run themselves and which go to an external laboratory.

Materials, traceability and subcontracting

Ask where the key materials and components come from, and whether they can trace a finished unit back to a material batch. Traceability is what makes a recall survivable rather than catastrophic.

Then ask the question people forget: what do you subcontract? Plating, printing, moulding, heat treatment and finishing are commonly sent out, and a subcontractor you have never assessed is a real gap in everything you just audited. Ask to know who they are and whether the factory audits them.

Agree in writing that your order will not be subcontracted elsewhere without your consent. Quiet subcontracting is a common cause of a second batch that does not match the first.

Documentation, compliance and people

For regulated products, ask who holds the test reports, in whose name, and covering which exact configuration. Verify certificates with the issuing body rather than trusting the copy you were sent, since a genuine-looking PDF is not evidence.

Look at working conditions honestly: hours, age of workforce, fire exits and safety equipment. Beyond the ethics, a factory with a chaotic or unsafe floor rarely has orderly quality systems, and buyers with UK retail customers are increasingly asked to evidence this.

Meet the person who will actually run your order, not only the sales contact. Ask how changes are communicated to the floor. A specification that never reaches the supervisor might as well not exist.

Making the visit worth it

Go with your specification in hand and use it as the agenda: walk the process your product will follow, in order, asking at each step how it would be made and checked.

Photograph what you are allowed to, take notes the same day, and score against a written list so that three factories can be compared rather than remembered.

If you cannot visit, a third-party audit or an agent acting for you is the alternative, and it is far better than nothing. What it is not is a video call arranged a week in advance, which shows you a factory that had a week to prepare.