Quality planning for imported goods: Classification by risk level (Part 1)

Every buyer knows that some orders are more risky than others, and the risk affects many of the decisions they make. This is why quality planning and sorting orders based on the level of risk are important for importers.

A common problem that I have observed is a tendency to follow a sense of familiarity rather than structured analysis.

So how to assess risks properly, without spending a lot of time crunching numbers?

2 criteria of order risk

You can score each order on 2 sets of risk criteria, to keep things simple and easy to manage:

Risk component 1: Commercial risk

There is a higher potential loss on the order of USD 100,000 compared to the order of USD 10,000. That is obvious, and so it needs to be taken into account.

Similarly, the management department in your business may feel worse about delaying or even canceling certain customer orders that they have already defined. A customer may charge a particularly high fine. Maybe ten customers are waiting for a certain product, and it’s always harder to disappoint and soften 10 companies than just 1.

Risk component 2: Process and/or product risk

Some types of products are more prone to quality problems than others. Here are some examples:

Light gray aluminum powder usually leads to more removal than black.

A wire bra in an inelastic material is more likely to have a size problem than a molded bra.

A coffee maker is more complicated than a toaster, and it comes with more potential problems.

New products with a high degree of change are inherently more risky than a product that has been produced many times, in the same way and in the same facility.

And, with the same idea, some manufacturers have proven they are more reliable than others.

Productivity and Quality Office