Pre-Shipment Inspection in China: Full VS Partial

Welcome back!

I have previously discussed factory inspections in China on my blog, but today I want to specifically delve into the pre-shipment inspection, which is the inspection you do when your goods are finished and ready for dispatch. Do you really have to spend all that money on a FULL inspection, or you can get away with a PARTIAL inspection? Let’s find out!

Just to remind you, if your order is placed through Alibaba’s Trade Assurance program, you will have to pick one of the inspection companies provided by Alibaba to qualify for their order protection.

At the moment, there are three options available:

1) Alibaba’s service team, which costs $48. This is not really a pre-shipment inspection service as all they check is carton quantity (whether or not it is correct), one item for visual defects and one carton for packaging and shipping marks. I don’t recommend you use this at all, as it won’t tell you anything about the quality of the goods in your order.

2) Bureau Veritas’ inspection service, which costs $118. This includes a maximum of two hours of inspection time, which is really not enough. They say that they will check up to fifty pieces for workmanship, one piece for functionality, three pieces for product quality, and they will verify that all the items (quantity) are included. So, if you’re lucky, up to fifty items in your order will get checked, but only if they can do it within that two-hour window.

3) China Certification & Inspection Group’s service, which costs $188. This is a FULL one-man-day service, which means that the inspector will spend up to eight hours at the factory. They promise that they will check up to five hundred items for workmanship defects, three items for functionality, ten items for product quality, three items for conformity, and they will verify that all of the ordered units (quantity) are accounted for.

Without a doubt, the only viable option (in my opinion) is the last one. $188 might seem like a lot compared to $48 or even $118, but I wouldn’t even consider using the first or second options. You would simply be wasting your money.

Now, if you’re not using Trade Assurance for your order, you can use any third-party inspection service you want. Personally, I have been using Richforth for many years now, and 99% of the time, they have done excellent work for me. Plus, their one-man-day service costs just $118, which is the same price that Bureau Veritas charges for their two-hour service.

You can order an inspection service from Richforth directly from their website here.

Plus, you can also use them for general factory inspections, too. The same price of $118 will apply. But today, I specifically want to delve into pre-shipment inspections as that’s the one people struggle with the most.

Your First Order with
a New Supplier

Most Amazon FBA sellers who are launching a new product will usually start with an initial order of 500 to 1000 units. Sometimes it can be more (for example, if it’s a very cheap product) and sometimes it can be less (for more expensive items). But the dilemma all sellers face is how to make sure all the items in their order are of the highest quality.

That’s where the pre-shipment inspection comes in, of course! The problem is that usually a one-man-day inspection is not enough to cover all of the items in the order. What is the solution? This problem is quite complex, so there won’t be one solution that fits all cases. Instead, we have to dive deeper and look at few of the most common situations and identify the best solutions to them.

First of all, I have always said that when you start working with a new factory to source a new product, ideally, you should have your first few (or at least the very first) shipments delivered to you directly before you send it to Amazon FBA.

This way, no matter how bad the order is, you will be able to go through all the items on your own, take out any defective ones and only send products to Amazon FBA that you know are in pristine condition.

Why is this so important for the first order? Because you’re launching a new product on Amazon, those first five, ten or twenty reviews are CRUCIAL to your success. They can have a huge impact on how well your listing converts and ranks over time.

Imagine a scenario where out of first fifty orders, five people receive damaged or defective items and you get five unhappy customers leaving one-star reviews. You’re basically done! That listing will never recover because your rating will be so bad and your conversion rate so low that customers won’t take a chance buying from you, even if you sort out the quality problem later.

When you have your first twenty to thirty positive ratings, one negative review won’t do that much harm, but in the early days, it’s super important to keep everyone happy and get your ratings as high as possible.

So, for this reason alone, I strongly recommend that you at least have your first order from a new supplier, for a new product, delivered straight to your home. This way, you can personally check all the items yourself and only send perfect products to Amazon FBA. Yes, this will cost you slightly more in logistics, but it’s well worth it!

This doesn’t mean that you shouldn’t do an inspection in China, though! You still have to do this so that at least part of your stock is checked in China before you send that last payment and before the goods are dispatched. It’s just that you will have more flexibility with your inspection results when you know that you will also be able to check your goods and take out any defective items.

When you have established a good relationship with the manufacturer in China and begin placing your third, fourth, fifth+ orders—and if everything has been great with previous orders—you can start sending stock directly to Amazon FBA (using your freight-forwarding company or an FBA prep house).

I would still recommend that you continue doing pre-shipment inspection in China, too, even if it’s just a partial inspection. You never know what could happen. The supplier could suddenly change their manufacturing process or use new equipment or make other production changes later on, so be aware that even your seventh order could go wrong.

The best way to approach this is to simply calculate the inspection service cost into your cost of goods. For example, if your order is 1000 units and an inspection costs $118, you simply add 12 cents for each item to the cost of goods. If you do this in the initial research/calculation phrase, you won’t have to moan about how expensive inspections are. You will already have it worked into your numbers.

FULL vs PARTIAL
Pre-Shipment Inspection

What is a PARTIAL inspection and what is a FULL inspection?

Partial inspection is when an inspector randomly checks X number of units from your whole order. For example, if your order is 500 units, the inspector checks 100 or 20% of the overall order.

Full inspection is when the inspector checks ALL of the units in your order for defects. This is obviously the safest way to go, and in an ideal world, we would all be doing FULL inspections on all of our orders. In most situations, however, this isn’t possible. It would simply cost you too much money!

As I already said, you can also order an inspection service and pay for it based on the time the inspector spends at the factory. Whether it is $188 for the Alibaba service or $118 for Richforth, it covers eight hours of inspector work, which usually means that they can only properly check 50 to 100 units max.

If your order is 500 units and the inspector can check 100 units per day, you would have to order five days of service to have everything checked, which will cost you $590 (5 x $118) with Richforth or $940 (5 x $188) with Alibaba’s service.

Obviously, this won’t be cost-effective in most situations, especially when cheap goods are involved. If the item I am sourcing costs more than $10 or $20, then yes, I would be happy to pay an extra $1.18 (Richforth) to have every item in my order checked—at least for the first order with a new supplier. But if you’re paying just $2 to $3 per item, spending that much on an inspection isn’t really viable.

So, what can you do?

With most cheap, simple, everyday items, I recommend you simply go with the partial inspection and have a random 50 to 100 units in your order checked. Then, based on the results of that inspection, you can decide what to do next.

If the items are more valuable, at least $10+, I recommend you pay for a full inspection—at least for your first order. The only exception I would consider is if the items are super simple and don’t carry a high risk of defects.

If your items are highly vulnerable to defects (mechanical products with lots of moving parts, electronics, items made from fabric materials with lots of sewing involved, etc.), then personally, I would do a full inspection on the first order, even if the product cost is say $6 and it would cost me an additional $1.18 to do the inspection. With such “complex” products, you simply can’t take the risk. You have to be 100% sure that everything in your order is defect-free and of the highest quality.

Product specifics will play a huge role in this. As I already mentioned, if it’s a relatively simple product—for example, an item that comes in one piece that is made from silicone using a mold—then the chances of defects are much lower compared to a complex item with lots of parts, like a camping tent. As the business owner, you have to make this call and use common sense.

Alternatively, you can always start with just a one-man-day inspection service, then based on the report, you can decide what to do next. This is an approach I often use. The cost doesn’t change as no one gives you a discount for ordering multiple days of inspection at a time.

The way it works is: you order a partial inspection service. If everything looks perfect, you complete the order. If there are defects in the order, you communicate with the supplier and ask them to fix these defects. Once that is done, I would actually do a FULL inspection of the order to ensure that every single item is sellable. If that report comes back with defects, then you ask the supplier to fix them.

Always ask the inspector to separate the defective items from good ones when carrying out their inspection. Usually, they will do this anyway, but it helps to remind them. This way, they can show the factory/supplier what the defects are, so they know exactly what needs to be fixed.

I will write another blog post to cover in more detail how inspections work, what quality standards they follow, what are classed as critical, major and minor defects, and much more. For now, if this is your first time importing something from China, you should at least understand how inspection services work and whether you need to have a FULL or PARTIAL inspection based on your items, price and order size.

Conclusion

If cost wasn’t an issue, we would all be having FULL inspections on every order from China. However, in reality, we usually have to stick with partial inspections and hope that the supplier has done a good job on the order.

One additional thing I would like to mention, and this is based on my 15+ years of experience, most problems with product quality are a result of three specific situations:

1) You haven’t done a thorough job researching the supplier and ordering samples.

I would NEVER place an order with a supplier without first receiving samples. Yes, they could make high-quality samples and then fail on the production units, that happens, but the minimum you can do is order those samples to check their quality. And you should order samples from at least two to three different suppliers so you can compare them against each other.

Even small details at the sample-ordering stage can reveal that something is not right with the supplier—for example, they poorly package samples, the samples look “used”, or you receive the wrong samples/wrong specs. Any such “mistakes” could indicate that the supplier is not very organised and the risk of getting low-quality products from them is much higher.

2) You have gone for one of the cheapest suppliers.

Classic mistake! You contact ten or twenty suppliers on Alibaba and simply go with the one that is the cheapest. Even in China, common sense works. So, if you get an unbelievably good deal/low price, chances are it’s purely based on the quality of the product.

I actually take the opposite approach. When I find a good supplier who I think I can work with, I ask them, “what are the premium materials or manufacturing practices we can use to make this the BEST product in the marketplace?” Yes, even if it means that my cost of goods increases, I want the absolute best quality possible.

Once you start selling on Amazon, you will quickly realise that the item’s cost is actually not that important. Don’t get me wrong, you have to make the numbers work, but you will often spend more money on PPC costs and Amazon fees than you do on buying the goods in China.

So, your main goal when sourcing goods from China is NOT finding the cheapest price. It’s looking for the highest quality product possible!

If you don’t, it will quickly backfire on you in the form of bad product reviews on Amazon, which will ultimately make your products unsellable.

3) You have picked a complicated product and have ordered it in a relatively low quantity.

People don’t understand that manufacturing is a complex process. We’re not simply buying goods from a shop or wholesaler. Instead, we’re asking a manufacturing company to make those goods for us! This often results in problems when you are dealing with complex items with lots of moving parts.

Let’s use camping tents again as an example:

• You find the cheapest supplier that looks okay to you.
• You ask for lots of customisations for the product.
• You negotiate the MOQ down to 100 (from 500).
• You negotiate the price down, promising huge next orders, etc.

Now, put yourself in the shoes of the factory. They regularly deal with large brands/companies who usually order thousands of units per model. Now there’s that one Amazon seller who is making more problems than anyone else, their order is super small, they require lots of customisations, and the potential profit is minimal. Obviously, in a situation like this, the chance of receiving defective items is high. That’s just business logic and common sense.

For all these reasons, I always recommend that you start out with products that you can actually afford to source in terms of both money and knowledge.

Stick with simple products that are suitable for your buying power. That way, you can order 500 or 1000 units and afford to pay premium prices for premium-quality goods. Be patient, look at this whole game from a long-term perspective, and strive to grow your business from the ground up on solid foundations.