When Do You Have Enough Compliance?

"When do you have enough compliance?"

I was recently asked this question by an industry-leading distributor. He regularly has to field compliance inquiries from his customers and is frustrated by the wide range of responses he gets from suppliers. The correct answer is, "when your response is more than enough to meet the expectations of your clients." If your clients do not care, you probably do not. But more and more companies are finding out first-hand that having a comprehensive compliance program is making a difference in their relationships and business with their Fortune 1000 clients.

Many suppliers feel like they are doing enough. Their position is "this is how we approach compliance." This is what we do and here is why it is enough. A good example is the many apparel companies who are relying on WRAP or FLA certifications. They may even have made this a requirement for the factories that they do work with. Here the answer to the question "is this enough?" is pretty clear. WRAP and FLA certifications are factory-level certifications that focus almost exclusively on social accountability. It's a great step in the right direction for your factories to have been audited on social accountability, but what are you doing? The factory's certification does not pass through to you and even if it did, you would only have one component of a compliance program covered. You still have not addressed product safety. It's not enough for Fortune 1000 customers.

Still more distributors and suppliers rely on testing or auditing as their compliance program. I addressed much of why this approach is not enough in a recent blog on the Golden Sample. With so many of the orders in our industry being small quantity, short lead-time orders, if you do not have compliance baked into your offering before the order it will be very difficult and cost prohibitive to manage it into a $500 order than ships in 3 days. At best, you would have blank product that was tested before it shipped and would hope that the inks you are using did not have any lead or cadmium in them. How would you know this if didn't test them? The ink companies have stated that they do not manufacture a children's product and at best have offered up outdated testing. They too feel that they are doing enough. You will be sending your Fortune 1000 clients a product that may or may not meet product safety requirements but you would only have one component of a compliance program covered. You still have not addressed social compliance. It's not enough for Fortune 1000 customers.