Executive Briefings

Companies Are Still Committed to Manufacturing in China, Despite Product Recalls

The recent wave of recalls of tainted products made in China hasn't dimmed that country's luster in the eyes of global manufacturers. In a survey by The Smart Cube, a business research firm, 78 percent of respondents said their supply chain management processes were more than adequate to address the problem of tainted products. Fewer than 25 percent said they had reviewed their practices in that area after the latest series of recalls. Only one in five said they were considering changes to their quality-control processes. "Despite the extensive publicity involving lead-tainted products from Chinese facilities, survey findings indicated that manufacturers still perceive China as the preferred destination for outsourcing manufacturing," said Omar Abdullah, managing director of The Smart Cube. Those companies view the recent recalls as isolated, supplier-specific incidents, "and not part of a systemic-wide problem or trend." China continues to be an attractive location for cheap labor and raw materials, Abdullah added, "and manufacturers don't believe that relocating to other developing countries would guarantee immunity from similar supply chain breakdowns." The survey further found that more than 80 percent of respondents considered their vendor-selection processes to be adequate.

Visit www.thesmartcube.com

The recent wave of recalls of tainted products made in China hasn't dimmed that country's luster in the eyes of global manufacturers. In a survey by The Smart Cube, a business research firm, 78 percent of respondents said their supply chain management processes were more than adequate to address the problem of tainted products. Fewer than 25 percent said they had reviewed their practices in that area after the latest series of recalls. Only one in five said they were considering changes to their quality-control processes. "Despite the extensive publicity involving lead-tainted products from Chinese facilities, survey findings indicated that manufacturers still perceive China as the preferred destination for outsourcing manufacturing," said Omar Abdullah, managing director of The Smart Cube. Those companies view the recent recalls as isolated, supplier-specific incidents, "and not part of a systemic-wide problem or trend." China continues to be an attractive location for cheap labor and raw materials, Abdullah added, "and manufacturers don't believe that relocating to other developing countries would guarantee immunity from similar supply chain breakdowns." The survey further found that more than 80 percent of respondents considered their vendor-selection processes to be adequate.

Visit www.thesmartcube.com