Chapter 21 – Ask Your Factory for a Corrective Action Plan to Prevent the Recurrence of a Similar Claim

After everything is agreed upon and the contract is signed by both parties, there remains one important point that has to be finalized before you go home. Having reached an amicable settlement with your supplier is good for your business but you must make sure that your factory takes the right actions to avoid similar problems in future.

If your home country authorities discovered a regulation violation, they will certainly want to make sure that the events are not repeated. They may even require proof that it will not be repeated before you can resume importing. This is usually accomplished by supplying them with a corrective action plan from your supplier.

What Exactly is a Corrective Action Plan?

This is an expression that you hear quite often from certification organizations when a product is found to be out of compliance with existing directives or regulations.

Non-compliance with an existing directive or regulation can give your company a big headache if your supplier does not have the competence or willingness to take corrective actions.

The factory has to prepare a technical document explaining in great detail what changes will be implemented immediately. It must apply to all new production in order to assure full future compliance with the existing regulations and directives. The document must be supported by photos, technical drawings, or any other information necessary to assure full compliance.

If it is a technical product the factory must apply for new certificates and may have to change the model number as well. I suggest you consider a new model if it is your own brand because your customers may be very reluctant to continue buying the same model after the authorities called for a nationwide sales stop. It is always good to inform them that you have changed the model number because major improvements have been implemented.

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