Chinese Manufacturing and Quality

by Business Case Studies on Tuesday 7th August, 2007

Chinese Manufacturing and Quality

The Chinese economy is continuing to grow at an incredibly fast pace, despite government measures undertaken to try and cool the economy.According to recent figures from the Chinese government, its economy has grown 11.9% in the last year (BBC, 19th July 2007).This growth is partly resulting from strong international sales.However, there have been some recent quality problems for the Chinese manufacturing industry.

There have been a number of safety scares relating to products exported from China.51 deaths in Panama were linked to ingredients in Chinese-produced cough syrups, whilst contaminated Chinese pet foods also caused animal deaths in the US (BBC, 10th July 2007).For companies who choose to manufacture in other countries in search of lower costs, it is extremely important to monitor the quality and safety of products, wherever they are produced.Following an internal investigation, toymaker Fisher Price is to recall almost one and a half million Chinese-made toys (many sold in the UK) over fears that their paint contains too much lead (The Times, 2nd August 2007).

There have been some concerns by government officials that the problems have been exaggerated by the international press.China's Commerce Minister Bo Xilai stated:

'We hope that the relevant sides will handle Chinese products in an objective, fair and rational manner. This should not impact on the normal development of trade'.(BBC, 2nd August 2007)

However, the Chinese government has certainly been taking the problems very seriously, with the former head of China's State Food and Drug Administration, Zheng Xiaoyu being executed for corruption (BBC, 10th July 2007).

One way that firms can try to develop a reputation for quality is to conform to recognised quality standards.The Times 100 case study on BSi describes how conforming to international, European and British standards, as well as applying for the Kitemark of quality and legal standards, can help businesses, by showing that their products meet the required levels of quality and safety.

Sources:

Chinese economy refuses to cool – BBC News, 19 July 2007

Toys recalled over safety fears – BBC News, 2 August 2007

Chinese product scares prompt US fears – BBC News, 10 July 2007

Fisher-Price recalls 1.5m Chinese-made toys – TIMESONLINE, 2 August 2007

China food safety head executed – BBC News, 10 July 2007

The Times 100 Edition 12 Case Study – BSI, Creating world class quality standards

Suggested Study Questions:

         What are the advantages for firms in gaining recognised quality standards marks?

         What is the difference between quality control and quality assurance?

         What are the advantages and disadvantages of outsourcing manufacturing to Chinese firms?

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