Trade Compliance

GHY discusses changes to international trade regulations and explores cutting-edge compliance strategies.

Mitigating International Sourcing Risks

Posted June 02, 2015


Speaking this week to DC Velocity magazine, Adam Brosch, director of global sourcing and custom tooling for Berlin Packaging, a supplier of packaging products and services, identified six major risks facing companies buying products from suppliers overseas and provided some sensible advice on how to mitigate them.

Obviously of particular interest to our remit here, “Compliance Issues” appeared on the list, described broadly as, “Suppliers’ failure to comply with social responsibility, quality, environmental, and safety standards,” which Brosch rightly noted “can be detrimental to your company’s relationships with customers.”

The recommendation provided was to: “Make sure suppliers understand both the standards and your expectations, and give them a reasonable period to come into compliance.” Brosch importantly added that “Regular audits of major suppliers are a must; in some cases, it may be worth hiring a neutral auditor to verify that proper practices are being followed.”

Other risks identified included Quality Expectations, Production Scheduling, and Logistics, along with two related to communications (Time Differences and Language Barriers).

Key to all of the recommendations is to never make assumptions or simply take things for granted, but rather to anticipate likely problems beforehand thereby allowing for appropriate precautionary measures to be taken in order to minimize their impact, if not avoid them altogether.  

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