Originally published by Promo Marketing on May 18, 2012.
Walking through one of the larger tradeshows in our industry is an interesting experience. It’s fun to see the plethora of new products, many quite clever, which work their way into suppliers’ product offerings. Like the retail industry, new products keep us fresh while giving our customers new things to get excited about and new reasons to purchase promotional products.
Having said this however, we must be careful when selecting where we purchase these products. Many items are sourced at Chinese tradeshows such as the Canton Fair with little research done regarding the factory that is providing the products. I have weekly conversations with both suppliers and distributors that reinforce the phrase “caveat emptor,” which is Latin for “let the buyer beware.” This has never been more prevalent in our industry as suppliers expand their product offerings into categories that are outside of their strengths or core competencies.
In Wikipedia’s definition of core competency, one of the sentences hit a nerve: “Core competencies are particular strengths relative to other organizations in the industry which provide the fundamental basis for the provision of added value.” Wow! How much does this NOT apply to our industry?
As you walk from booth after booth on the tradeshow floor, it becomes apparent that multiple suppliers are purchasing identical or very similar products-often from the same factories. With multiple product categories being offered by numerous suppliers, how can you tell which supplier is really good? How can you tell what their core competencies are? Is the supplier’s only core competency its ability to decorate the product? Any why does it matter?
In our industry, I believe there are two fundamental ways that suppliers grow their businesses. First, they can work very hard to acquire new customers that will purchase their existing product lines. Or second, they can add new product categories to their lines so they can sell more types of products to their existing customers. Most companies try to do both, but adding more product categories appears to be the path of choice.
It seems that every week there’s a press release announcing a supplier is adding a new product category to its line. This makes sense; adding a new category is easier than winning new customers. However, these new categories often have little, if anything, in common with the supplier’s existing lines-other than the fact that the product can be purchased from a factory in China. This is a big problem, and here is why it matters: If distributors buy an unknown product category from a well intentioned but poorly informed or educated supplier, the distributors are putting both their clients’ brands as well as their own businesses at risk.
I shared some examples of product categories that carry significant risk in an earlier Compliance Chat post, “Risky Business.” A couple of the categories that really drive this home to me are hand washes/sanitizers and candy or food products-both of which are offered by suppliers that are purchasing them out of China. Hand sanitizers in particular have been popular additions to many suppliers’ product offerings throughout the past few years, and who doesn’t offer mints these days? We put this stuff on our hands or into our bodies, so if the supplier offering these products does not know the difference between a safe and compliant product versus a noncompliant one, you could literally be poisoning your clients.
The candy and food examples are equally disturbing. There have been a number of instances that highlight the lack of food safety being offered by Chinese manufacturers. If you want to learn more, this compilation of articles on China’s Food Safety from The New York Times does a much better job of illustrating this point than I can. Chinese manufacturers are not trying to intentionally poison us; they simply do not have the same standards for food safety that we do. With this in mind, do you really want to be purchasing food items that have the risk of containing melamine or other fillers?
Food for thought: Before buying from new or even your preferred suppliers, check into whether or not these suppliers know what the compliance requirements are for any new products they are adding to their lines before you start buying from them. It matters to your end-buyer clients, and it should matter to you.
Next Compliance Chat Blog: Some quick and easy ways to determine if a product category is a core competency for a supplier.
Brent Stone is executive director – operations for Quality Certification Alliance (QCA), the promotional products industry’s only independent, not-for-profit organization dedicated to helping companies provide safe products. A Six Sigma Black Belt, Stone has more than 25 years of in-depth supply chain management experience with extensive expertise in process design, development, improvement and management. He can be reached email@example.com or visit www.qcalliance.org for more information.