The quality detectives

Zhang says he sometimes feels like a doctor breaking bad news to his patient whenever, that is, he has to tell a customer he has “unfortunately found something” in their merchandise. A chemical for instance that has no place in a “Made in China” product meant for export to Europe. While Zhang is practically inconsolable at such meetings, they also give him a sense of accomplishment: after all, it is his job to detect the unwanted and unlawful. Everything the quality assurance manager tests has to comply with specific purity regulations.

Zhang works at the Hermes Hansecontrol testing institute in the Chinese city of Dongguan, an Otto Group company. It monitors the quality of goods manufactured in China’s flourishing procurement market and destined for sale in the West, to ensure they meet international standards. Hansecontrol offers its clients a comprehensive package of quality assurance services. In the Otto Group, it stands as a good example for the entire portfolio of retail-related services across the value chain (see chart). Hanjo Schneider, Member of the Otto Group Executive Board, Services, and CEO of Hermes Europe GmbH, which unites all Hermes operations, says: “We are the only vendor on the market able to offer customers everything from product development to sourcing, from quality control of goods in the Far East to transport to Europe and America, through to delivery to warehouses, stores and the customer’s doorstep – including payment management.”

Hansecontrol works for manufacturers and retailers outside the Otto Group as well, offering them the full range of quality assurance services: from consulting to on-site product testing at the production plant, to inspections just before the product is exported. Therefore their customers can fully concentrate on their core business.

Hansecontrol Dongguan is a recent arrival in this city of 1.5 million, where ambitious planning is in evidence wherever you look. The once cosy little village of Chen Jia Pui is now a landscape of factories and industrial estates, high-rise buildings and streets that still appear outsize. More and more businesses are expected to settle in the area – in Chen Jia Pui and the town of Liaobu, the prefecture-level city Dongguan and the southern Chinese province of Guangdong, where roughly a third of all Chinese exports are manufactured.

Quality defects can bankrupt a company
In this ongoing boom, assuring the quality of its products is crucial to a company’s survival. Every now and again, buyers in Europe are alarmed by reports of defective goods made in China. Hazardous substances can damage the consumer’s health, and material defects or poor workmanship can impair the product’s usability. Failure to discover such problems in time results in fines and penalties, financial losses and damaged reputations. These in turn can drive a company to ruin.

The company has invested more than three million Euros in Dongguan. Its American General Manager Keith Kimsey, 64, is the company’s only non-Chinese employee, and has been on board in Dongguan from the beginning. In just nine months – all bureaucratic barriers notwithstanding – he and his team transformed a former warehouse into a state-of-the-art lab, and Hansecontrol was able to launch its Dongguan operations in March 2010. Since then, the quality of products has been tested and assured in spacious, well-lit rooms right where they are produced – from shoes and leather goods to textiles and toys. Everything still looks brand-new; one can almost imagine the scent of fresh paint in the air. The staff of 40 is predominantly young – at 38, Zhang is one of the oldest employees.

He is very much aware of his responsibility: for his own work, and for that done by his customers. Production cycles are getting shorter all the time. Even minor disruptions to the production process can bring the manufacturing machinery to a costly standstill – as when Zhang has to report that he has detected illegal levels of heavy metals in a test object. Or of azo compounds. Some of these hazardous chemical dyes have been banned in the EU for a number of years, but still occasionally crop up in products.

For Zhang, customer focus also meant extending his own horizon: he studied chemistry at Shanghai’s renowned Huadong Li Gong University, and later worked as a chemist for an American company, which is where he met Kimsey. “I used to see myself as a specialist, as a chemist. But it isn’t enough just to tell the customer: ‘We’ve tested your product and it failed the test.’ You have to also offer him help in solving the problem.”

This is why Hansecontrol Dongguan doesn’t just run lab tests, but also hosts seminars, workshops and coaching. Among the beneficiaries are many suppliers, including small and medium-size enterprises (SMEs). Hansecontrol provides them with information about chemical interrelationships in the production process. What steps can one take to avoid contamination with harmful substances? How can specific problems be remedied? What are the latest EU Directives and what is important to consumers in Europe?

Sometimes Zhang and his colleagues find themselves on the receiving end of such coaching – when the experts from Hansecontrol in Hamburg are in town, that is. They train the staff in Dongguan and work with them to develop ideas for further improving the work in China. The two sites see each other as collaborators rather than rivals. Bundling expertise in this way benefits the two companies, their clients – and ultimately and most importantly, consumers all over the world.

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Workbench for the world

An alternative name for the region around the Pearl River delta. The province of Guangdong accounts for one-third of all Chinese exports.