Verifying Suppliers is necessary for reliable B2B sourcing
Let’s say you already have a list of screened suppliers that your business needs to connect with. First, to avoid legal disputes in your country, ensure that you have a verified supplier qualification before dealing with them. Given that you could potentially be working very closely with these specific suppliers in the future, it is vital that you assess the levels of risk that they could pose to your business, and ensure verification and compliance in the areas of quality compliance, social compliance, environmental compliance, and security compliance.
Supplier qualification is a factor vital to the integrity of your business, and is a pre-requisite in some sectors, such as importing toys, apparel, shoes, and other consumer products. Moreover, in order for your business to stay competitive, internationally reputable, and trusted by your customers, proper evaluation measures, risk controls and disclosure procedures are critical. Lack of transparency is usually a barrier that puts prospective customers off a particular jurisdiction; however, with the correct supplier qualifications and compliance framework in place, manufacturers, suppliers, and clients can truly go cross-border.
Here are the eight qualifications of different industries that you should be aware of:
Worldwide Responsible Accredited Production (WRAP) – is an independent non-profit organization for footwear, apparel, and sewn-products suppliers that promotes ethical manufacturing. It protects the rights of workers, making sure that they are paid decent wages and enjoy good working conditions; and it also covers health and safety benefits. The program involves 12 principles for international standards. Verify your supplier evaluation rating and ask to see the certification. Click here for more information.
Restriction of Hazardous Substances Directive (RoHS) – is a supplier qualification from the European Union (EU) directed at foreign suppliers and manufacturers in electrical and electronic equipment (EEE). Suppliers are certified under this directive when restricting certain chemical substances in their products, guaranteeing that they are hazard-free based on the above-mentioned classification or products. RoHS is also known as the lead-free directive and restricts the following substances: mercury, lead, hexavalent chromium, Polybrominated biphenyls, and Polybrominated diphenyl. Visit the official website for more information.
CE Mark – is another EU safety standard for foreign suppliers who wish to sell items in the European Economic Area. The mark is usually seen on consumer electronics, toys, medical equipment, and many other products. Products requiring CE marking include many items that you can check in their official website. The directive has mandatory status as regards the relevant product groups. However, according to the UK Government, not all products must carry the mark unless otherwise stated under the classification.
Supplier Ethical Data Exchange (SEDEX) – is a non-profit organization that promotes ethical supply-chain practices on a global scale. It acts as a platform or online database enabling suppliers and manufacturers to exchange supply-chain data, including labor standards, environmental practices, health and safety, and business practices. The organization offers three types of membership for suppliers. However, as stated on the SEDEX official website, it “is not a standard setting body, code of conduct or certification.”
Business Social Compliance Initiative (BSCI) – This is a directive from the EU that promotes ethical working conditions. Similar to SEDEX, this organization advises that no certification is given to suppliers and exporters, but an audit report is given, which the company can use and post on factory premises as a proof that an independent body has conducted an audit. The BSCI audit also complements the SA8000 certification and acts as a support system for exporters and businesses in providing sources and training for social compliance.
ISO Certificate – TheISO organization provides membership for suppliers and manufacturers whose products are in compliance with international standards. The ISO certificate proves that the products are safe, reliable, and of good quality. There are different ISO standards certifications that suppliers may apply for, depending on the type of business and product specifications, including standard certifications for water, health, food, automotive, and many more.
ETL Mark – this is a North American product-safety standard for electrical testing laboratories, ensuring that the products are tested independently and are in compliance with US and Canadian standards. A product with the ETL marking from the Intertek Group is a proof of compliance and successfully passing safety tests.
REACH certificate (Regulation, Evaluation, Authorization, and Restriction of Chemicals) – suppliers can apply for this European safety certification for evaluation of chemical substances in products. The certification requires that the involved suppliers, manufacturers, and importers should disclose all chemicals used throughout the entire supply chain.