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Asian Food Scandals, Dangerous Factories and Lack of Social Compliance. Hot Topics in Q3 2013 for anybody sourcing (or consuming) products from China, Bangladesh, Vietnam, India and the rest of Asia. Social Accountability is this quarters hot topic.
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Asia’s Shifting Supply Chain
When Chasing Lower Costs Sacrifices Safety
AsiaInspection Q3 Barometer
lack of chinesefood safety controlsallow consumer illnessand death to continue
lack of chinesefood safety controlsallow consumer illnessand death to continue
20 tonsof fake beef
Arsenic in Chineseherbal remedies
Formaldehyde in Chinese fish sold in US
Scandals continue to rock the Chinese food supply:
20 tonsof fake beef
Arsenic in Chineseherbal remedies
Formaldehyde in Chinese fish sold in US
• Eachyear 10+ million containers of food areimportedtotheUS
• 3,037 people died in2011fromfood-borne illnesses
• Over 60% ofUSfoodimportscome from developing countries, with China leading
• Only 1.5% of incoming food shipments are inspected
• Each year 10+ million containers of food are imported to the US
• 3,037 people died in 2011 from food-borne illnesses
• Over 60% of US food imports come from developing countries, with China leading
• Only 1.5% of incoming food shipments are inspected
Despite these alarming numbers,the U.S. Department of Agriculture is relaxing regulations
on food imports from China
Poultry slaughteredin the U.S. & Canada
Poultry processedin China
Poultry consumptionin the U.S.
Despite these alarming numbers,the U.S. Department of Agriculture is relaxing regulations
on food imports from China
To make sureAsian facilities are up
to international standards
Growing concern from the food industryin Q3 saw
Food Inspections increasein Q3 compared to Q3 2012
Food Hygiene Auditsincrease
+89%+93%
Since the Rana Plaza Factory collapse in April 2013, AsiaInspection figures show a :
• +52% increase in Factory Accountability Audits throughout Asia for Q3 2013 compared to Q3 2012
• +167% spike in Bangladesh
• Demand has increased the most from North American importers, up +72% for the period
north american importersdrive surge in social accountabilitynorth american importersdrive surge in social accountability
This growth has been sustained throughout Q3 with September seeing the biggest demand for Audits
AsiaInspection has ever seen.
This growth has been sustained throughout Q3 with September seeing the biggest demand for Audits
AsiaInspection has ever seen
Companies have pledged to achieve 100% inspectionsat all alliance factories by 2014
Growth in North America has charged forwardwith major retailers, brands and apparel companies founding
the alliance forbangladesh worker safetythe alliance forbangladesh worker safety
the alliance for bangladesh worker safetyTHe ALLIANCe FOR BANGLADeSH WORkeR SAFeTy
factories in chinashift inland, score lowin social compliancefactories in chinashift inland, score lowin social compliance
Rising labor costs
Cheaper labor costs
70%
Rising labor costs
Cheaper labor costs
70%
Average compliance score within China in 2013
Western China
The North
eastern seaboard provinces
compliance scorewithin china in 2013compliance scorewithin china in 2013
6.08
6.12
5.91
Guangdong province
7.1
6.226.22
shifting productionto cheaper regionsat the cost of social compliance
shifting productionto cheaper regionsat the cost of social compliance
Recent events through Asia have shown that the social and safety risk is very real for the whole
supply chain.
Buyers should be aware that shifting productionto cheaper regions is likely at the cost of social
compliance
Chasing lower production costs must come with a holistic approach of on-site monitoring and
auditing.
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Sebastien Breteau, CEO of AsiaInspection
about asiainspectionyour eyes in the factory™about asiainspectionyour eyes in the factory™
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