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'Quality Fade': China's Great Business Challenge

Knowledge at Wharton·@HashtagPLUS·about 1 month ago
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Numerous news stories this past month have focused on concerns about the quality and safety of certain Chinese exports. In this opinion piece, Paul Midler, founder and president of China Advantage, a services firm that provides outsourcing and supply chain management to U.S. and European companies, discusses what he calls “quality fade” in China, which he defines as “the deliberate and secretive habit of widening profit margins through a reduction in the quality of materials.” Recent media reports detailing a series of quality problems with Chinese-made exports — pet food tainted with prohibited chemicals, toys covered with lead paint and tires that fall apart at high speed — have understandably alarmed the American public and resulted in a number of international product recalls. But supply chain professionals not directly affected by these recalls remain unusually calm. “Everything will be all right,” said one U.S. importer on a buying mission to China.…

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