3PQ - An Often Overlooked Resource
By: Michael L. Hetzel, Vice President/Americas
Pro QC International
One of the most frequently overlooked resources available for long distance procurement risk reduction in the areas of product quality and payment security is the use of third party quality service providers ("3PQ"). Basically, a 3PQ provider has engineers based near your source locations to represent your interests in quality and conformance of tooling and products to your orders, and at a fraction of the total cost of opening your own field office(s) near your suppliers.
3PQ reports can be used as the basis of shipping and/or payment approvals, substantially reducing your sourcing risk since you receive an objective report covering the same elements you and/or your customer would be inspecting upon receipt. Very important is the fact that most problems will be detected before the population leaves the factory, saving not only money but the significant time it would take to receive the shipment, detect the defects, and then have the factory make and ship replacements while you and your clients wait to receive them.
For container loading supervision the 3PQ inspector observes the loading, takes photos and diagrams the load, verifies the count and places a seal on the container. The 3PQ report then allows you to authorize release of payment with a high level of confidence in its contents and your shipment is on its way.
From vendor qualification audits to pre-shipment inspections, corrective action management to container loading supervision, a good 3PQ provider is like having your own local staff near your suppliers except you only pay for those days that you need them.
Our company is one of many providers offering 3PQ services China, in our case since 1984 and in over 30 countries altogether. When evaluating a 3PQ look for companies with many years of experience in the target country, reports delivered online and in English at most 24 hours after completion of service, company owned regional offices rather than franchises, direct employees rather than contractors (although virtually all 3PQs use some contract engineers in limited locations or categories), and degreed and accredited engineers and auditors conducting the inspections and audits. Also confirm that they only work for buyers - not sellers (this is a true 3PQ), and then consider cost/value relative to your product movements.
As with any potential supplier visit their offices and meet their staff and beware of those who make excuses and try to meet you at your hotel or the factory instead of their office. Finally, find the best price balanced against level of services needed. The lowest price is definitely not in your best interest considering the implications of inaccurate reporting relative to the value of each shipment and the many 3PQ companies who literally employ kids with minimal training rather than experienced engineers.