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Overseas Manufacturing and Clearly Defined Product Specifications

By Dan Harris on September 23, 2020
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The number of companies with product quality problems seems to be increasing exponentially as companies move their manufacturing from China. There are two reasons for this and one relatively easy and inexpensive solution.

The first reason for the increase in problems is that Chinese manufacturers care a lot less about giving good quality to a company that will be leaving it soon or is believed to be leaving soon. The second reason is because the new supplier — be it in Thailand, Malaysia, Vietnam, Indonesia, Mexico, Pakistan, or wherever — is a new supplier and it almost invariably takes time for a new supplier to understand exactly what it is it is to produce.

What is the solution to all this? A really good product specification sheet that is clearly incorporated into a truly enforceable and localized product manufacturing agreement. See Overseas Manufacturing Contracts (OEM, CM and ODM) and How YOU Can Avoid Problems when Manufacturing Overseas.

What though constitutes a really good product specification sheet? Above all else it should be one that is understood by the factory you wish to understand it. That means writing it clearly and oftentimes it makes sense to just flat out ask your factory if they have fully understood it. Most international factories have a good enough grasp of English so that it is fine for your product specification sheet to be in English, but if they don’t, then get it translated by someone who truly knows your language and the language of the factory and the sorts of specification terms common to your industry.

In terms of what should go into your product specification, it almost always makes sense not to assume anything from your factory and to go overboard in terms of your requirements. So for example, listing some industry specification is fine but you should not assume that your overseas factory actually knows those specifications because they very well may not. So go ahead and list it as a specification but then also list the particular specifications that make up that industry specification.

Generally, you are going to want to list all of the below, at minimum:

Materials. You may want to list the percentage/volume of each material.

  1. Size. This usually means all relevant dimensions and the volume.
  2. Components. You may want to provide separate specification sheets for each component.
  3. Colors. Don’t just tell them red; use something like the Pantone Matching System to make sure it is the exact color red you want.

If your factory will also be responsible for the packaging and boxing of your product, do the exact same thing with both of those as well.

Trust me when I say that if you do all of the above your odds of getting good product anywhere in the world will go way up.

What are you seeing out there?

Photo of Dan Harris Dan Harris

Dan is a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

He primarily represents companies doing business in emerging market countries, having spent years building and maintaining a global, professional network. 

…

Dan is a founder of Harris Bricken, an international law firm with lawyers in Los Angeles, Portland, San Francisco, Seattle, China and Spain.

He primarily represents companies doing business in emerging market countries, having spent years building and maintaining a global, professional network.  His work has been as varied as securing the release of two improperly held helicopters in Papua New Guinea, setting up a legal framework to move slag from Canada to Poland’s interior, overseeing hundreds of litigation and arbitration matters in Korea, helping someone avoid terrorism charges in Japan, and seizing fish product in China to collect on a debt.

He was named as one of only three Washington State Amazing Lawyers in International Law, is AV rated by Martindale-Hubbell Law Directory (its highest rating), is rated 10.0 by AVVO.com (also its highest rating), and is a recognized SuperLawyer.

Dan is a frequent writer and public speaker on doing business in Asia and constantly travels between the United States and Asia. He most commonly speaks on China law issues and is the lead writer of the award winning China Law Blog. Forbes Magazine, Fortune Magazine, the Wall Street Journal, Investors Business Daily, Business Week, The National Law Journal, The Washington Post, The ABA Journal, The Economist, Newsweek, NPR, The New York Times and Inside Counsel have all interviewed Dan regarding various aspects of his international law practice.

Dan is licensed in Washington, Illinois, and Alaska.

In tandem with the international law team at his firm, Dan focuses on setting up/registering companies overseas (via WFOEs, Rep Offices or Joint Ventures), drafting international contracts (NDAs, OEM Agreements, licensing, distribution, etc.), protecting IP (trademarks, trade secrets, copyrights and patents), and overseeing M&A transactions.

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  • Posted in:
    Business and Commercial
  • Blog:
    China Law Blog
  • Organization:
    Harris Sliwoski
  • Article: View Original Source

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