Suppliers are challenging to come by. So when you find one that might be worth working with, a factory audit checklist is a tool you don’t want to ignore. Due diligence is your ally, leaving no stone unturned your best course of action. After all, partnering with another company can be a devastatingly costly business if you haven’t done your research. Never read a book by its cover, as they say.
A Factory Audit Checklist is a document used by business owners and senior management to document supplier facility (factory) inspections. Typically utilized in new supplier analysis, the Factory Audit Checklist by 1st Reporting is equipped for new supplier acquisition and existing supplier analysis.
We will explore some of the finer points of factory audit scenarios, so stick around to get some actionable management tips to help you get a leg up on the competition. Beginning with a quick overview of the checklist, we’ll follow up with a few questions to your most commonly asked questions.
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Try auditing your factory or warehouse with our mobile audit checklist, a standard in our mobile app, 1st Reporting, available at Google Play or The Apple App Store.
You may be wondering: What should be included in an audit checklist? Well, we’ve broken the process down into six primary categories. Here’s a brief overview of each:
There are many benefits to auditing a factory’s general facilities and equipment before agreeing to use the factory for production. With a good audit checklist, it will be easy. Here are some of these benefits inclusions:
1. Ensuring that the factory is up to standard with the latest equipment.
2. Checking that the factory has the necessary resources to produce the goods.
In the General Facilities and Equipment section of the Factory Audit Checklist, we include an analysis of:
General management will make or break a company—several key questions in the General Management section focus on analyzing the factory’s management style. Similarly, we’ll also look at operational management and management attentiveness.
Quality Control Management is one of the essential aspects to characterize during your factory audit. Therefore, it’s no wonder this section of the Factory Audit Checklist takes such a relatively large portion of the document.
The QCM section encompasses the quality management system, ISO 9001 and other ratings, and several questions about the quality control processes.
When considering a new supplier, it is essential to carefully audit potential factory suppliers’ quality control practices. This is because the quality of a company’s products or services is essential to maintaining customer satisfaction and trust.
The supplier’s quality management system should include multiple quality audits throughout the manufacturing process of producing quality products. Internal audits should be a standard within the factory, and you must use a robust quality management system.
A comprehensive factory audit checklist includes assessing the quality audit process itself. There’s no other way to adequately gauge a potential factory supplier without a firm analysis of their product quality.
Regulatory compliance will make or break your deal. Therefore, it is essential to focus a keen eye on the factory’s regulatory obligations. The regulatory compliance section of the factory audit checklist aims to do just that – provide a backdrop for regulatory compliance analysis.
Ensuring your suppliers meet the required business standards via regular audits means maintaining compliance with evolving regulations. Regulations change, and your suppliers must follow suit.
Many a quality audit checklist for production processes neglects the inclusion of training as a key indicator of potential quality issues. A highly skilled (trained) workforce will typically produce better products.
Similarly, safety training ensures that suppliers meet regulatory requirements. Furthermore, by actively utilizing safety training programs, compliance teams find that loss of labor and production due to injuries is significantly decreased.
Production units need proper components engineered for best manufacturing practices while maintaining the approved budgetary constraints. Your supply chain has to work for you – and that means that they need to evolve their manufacturing for product changes, upgrades, and mitigation of any issues within the manufacturing process.
Ensuring a factory supplies final products that meet a changing market means they must demonstrate an ability to re-tool equipment, make design changes, or adapt to design changes made by you.
Supplier factory audits don’t have to be significant production processes. You can quickly analyze their quality control system and other aspects of the factory’s operations with a Factory Audit Checklist. Even better, a mobile form application would be ideal, but we’ll get to that.
Here are eight of our favorite tips for managing a supplier factory audit.
ISO (International Organization for Standardization) certifications are internationally recognized quality management standards that play a crucial role in factory audits. They serve as a reliable benchmark for evaluating a supplier’s commitment to quality, efficiency, and consistency.
One of the most well-known ISO certifications is ISO 9001, which focuses on Quality Management Systems. This certification indicates that a factory has established processes and standards that aim to meet and exceed customer and regulatory requirements, as well as continually improve its systems. When auditing a new supplier, confirming their ISO 9001 certification can provide added assurance that you’re partnering with a committed and quality-oriented organization.
While ISO 9001 is often seen as the gold standard for general quality management, there are several other industry-specific ISO certifications to consider, such as ISO 14001 for environmental management or ISO 45001 for occupational health and safety. Ensure you’re aware of the certifications most relevant to your sector to conduct a thorough audit.
In your Quality Control Management section of the audit, review the supplier’s ISO certification status. Verify not only the presence of these certifications but also their validity and relevance to your industry. Ask questions like:
ISO isn’t a one-and-done achievement; it requires ongoing audits and renewal. Consistency in maintaining ISO standards is a good indicator of a factory’s long-term reliability. As such, inquire about the supplier’s history of ISO certification renewals and their plans for future re-certifications.
Always cross-check the supplier’s ISO certifications with the issuing bodies. Most certifying organizations have online databases where you can validate the authenticity of a certification. This small but significant step can save you from entering into contracts based on false or outdated information.
Understanding and verifying ISO certifications should be a cornerstone of your factory audit process. They provide invaluable insights into a supplier’s capability and commitment to quality, making your supplier selection more foolproof.
Depending on your industry and the manufacturing facility type, there are several items to audit when analyzing the operation. You’ll want to ensure these are on your audit checklist. Here are the general aspects of the manufacturing company that require attention during the audit:
– Logistical feasibility
– Factory conditions
– Factory safety and security systems
– Appropriate equipment and equipment management
– Storage capacity
– General Management
– Quality Control Management
– Regulatory Compliance
– Training
– Research and Design
A factory audit is not a simple process, but rather, it has multiple aspects that require scrutiny. Begin by establishing the primary needs your company requires fulfilled. Then, make a list of those needs and include every foreseeable need, no matter how trivial. Reorder your list in order of importance and use a Factory Audit Checklist to complete your auditing procedures.
There are a few different factory audits, but regulatory compliance audits, quality control audits, and safety audits are the most common.
Regulatory Compliance Audits
A regulatory compliance audit assesses whether a factory complies with all relevant regulations. This type of audit is essential to ensure that the factory operates within the bounds of the law and that its products are safe and meet quality standards.
Quality Control Audits
Quality control audits evaluate the quality of products or services produced by a factory.
Quality control audits are essential because they help ensure that the products produced by a factory meet quality standards. By auditing a factory’s quality control processes, you can identify and address any potential issues before they result in defective products. Furthermore, quality control audits help ensure that your supplier consistently meets your expectations for quality.
Safety Audits
A safety audit is conducted to assess a factory’s compliance specifically concerning safety. These audits are essential to ensure that the factory is safe for workers and that products produced by the factory are safe for consumers.
The answer to this question depends on the needs of your company. You should conduct a factory audit whenever you need to evaluate the manufacturing facility’s ability to meet your company’s needs. Additionally, it is good to conduct an audit before entering into a contract with a new supplier and periodically (annually, biennially, etc.).
A factory audit is also essential to perform on your own facilities, not just those of your suppliers. Consistent attention to your factory processes ensures success almost as much as using a robust reporting app like 1st Reporting to document your audit.
Selecting the right supplier is no trivial matter; it’s a decision that impacts your business at its core. Our comprehensive guide deciphers the complexities of conducting effective factory audits to help you make informed choices. Covering six critical audit categories — from General Facilities to Research and Design — we offer invaluable tips and an in-depth FAQ section to answer your burning questions. But that’s not all! Download our FREE Factory Audit Checklist Template to ensure you leave no stone unturned in your quest for a superior supplier.
