Protect and Serve
During the summer of 2007, millions of Chinese-made toys were recalled for lead paint violations and magnet hazards. After the incident made headlines, people in the promotional products industry started to worry.
"There were a number of folks who got together and said, 'Hey, we've got an issue,'" D. Fenton, executive director of compliance for Quality Certification Alliance (QCA), said. "'Potentially our industry is at risk. What's to stop our customer from reaching for a gift card in lieu of a promotional product? So what do we need to do to ensure that our customer feels that we are taking the steps necessary to protect their brand?'"
That concern soon developed into the creation of QCA, a Chicago-based nonprofit that conducts a comprehensive manufacturing compliance accreditation program for promotional product suppliers with a focus on product safety, social accountability, environmental stewardship, product quality and supply-chain security.
The QCA is changing the way some companies do business. Several distributors have vowed to give preference to QCA-certified suppliers (see sidebar on page 24). Suppliers touting a compliant product line can validate these claims by going through QCA's formal accreditation process.
"QCA is not a club," Fenton said. "Anyone can put these policies and procedures in place. You can self-validate that you have effective products and procedures. The difference is that QCA members have subjected their policies and procedures to third-party, independent review."
The QCA accreditation process can be broken down into two main areas. The first step involves extensive self-assessment. This part of the process allows suppliers to find any policy or procedure voids and correct them. Next, one of QCA's third-party inspectors audits the headquarters and supply base. If both reach a certain score, the results are passed on to Fenton and then the board of directors for approval.
Read on to find out where QCA has been and where it's headed in the future.
The Early Days
Bensussen Deutsch & Associates Inc. (BDA), Woodinville, Wash., invited approximately 14 companies within the industry to a meeting at the PPAI Expo in 2008 to discuss the state of product safety and compliance, according to Larry Whitney, director of global compliance at New Kensington, Pennsylania-based Polyconcept North America—the parent company of suppliers Leed's, Bullet, and JournalBooks/Timeplanner Calendars—who attended the meeting.
"Short of any of us basically putting our hands on a stack of bibles [and] saying, 'Trust me, we're doing everything we can,' there was really no way, no independent view, no way to demonstrate that any of us were meeting the requirements for our product," Whitney, who was the compliance manager for Leed's at the time, recalled.
All agreed a third-party audit was needed to authenticate their polices and procedures. Ten of the suppliers in attendance, along with BDA, jumped on board and became the founding members of QCA.
"We put money together, we hired somebody who is an expert [Fenton] and funded basically what has become an independent and third-party organization that will accredit us," Whitney said.
To date, 27 companies are currently accredited with 16 working through the roughly 20-month program, though some have completed it in as few as five months. Three formerly accredited suppliers have decided not to continue, and eight started the program without completing it, but three of those have resumed.
Supplier Commitment
Gill Studios Inc., Lenexa, Kan., had been testing its products and even started to phase out solvent inks 20 years ago since they weren't environmentally friendly. The QCA process helped them to formally document policies and procedures, Paul Lage, Gill's president and CEO since 2010, noted.
"I think oftentimes a lot of companies have tribal knowledge, and I would say we were one of those companies," he said. "In our heads we know how it all works, but it wasn't always on paper. And it kind of forced us to do that and that was actually a good thing. [The QCA process] also made us look at a lot of our processes to see what we could do better to better sustain the standards we were committing to."
It also made Gill Studios, which was accredited in January 2013, realize the process wouldn't be as easy as first anticipated. As a U.S. manufacturer, Gill Studios imports very little, but Lage identified working with its supply chain as the most difficult obstacle on the road to QCA accreditation.
"When you start inserting other suppliers of ours in the mix, they don't necessarily have the same commitment or understand why [they must comply to the regulations], and sometimes are challenged by some of the investments that are required on their end to provide the products that we're asking for," Lage remarked. "At the same time, you find yourself aligning with vendors who have the same mindset."
Each supplier may have lacked different components, but they all ended with the same result: a QCA-accreditation and comprehensive policies and procedures in place that varied depending on their products, distributing markets and the regulations that apply to each.
"I think each of the founding members did an awful lot," said Whitney, who is overseeing Leed's third accreditation process. "And if you talk to any of us, we'll all freely admit that while we thought we did a lot, as we went through the QCA process, we all found areas that we needed to tighten up, and it made us stronger companies as a result."
The QCA Effect
The simple truth is more end-buyers are demanding compliant products for various reasons, but all expect products to be safe, Fenton said.
"The supplier is more educated, more informed and to a large degree, the distributor community is likewise, and I'm going to say to a large degree, there is kind of a split between Main Street and Wall Street," she commented.
Fenton described community businesses, like a dry cleaner or small town bank, as "Main Street" and possibly unaware of compliance issues, while "Wall Street" companies are Fortune 1000 businesses that are concerned about the impact a non-compliant product could have on their brand.
Regardless of the company, Whitney believes one wrong move could destroy the industry.
"If a distributor sells something to an [end-buyer] and that product jumps up and bites that [end-buyer's] client or customer or employee, that [end-buyer] is not going to be buying from that distributor again and that distributor is not going to be buying from that supplier again, and depending on who the end-user is, it could be on 'Good Morning America' or the local news and all of a sudden all promotional products are tarred with the same brush," Whitney said.
Lage hopes others will help to take the lead to prevent product safety from having a negative effect on the industry.
"I look forward to having more suppliers and more people committed to this whole program," he shared. "It's the only—what I'm going to say [for now]—big, organized effort in the industry to certify suppliers in an area of product safety."
The Distributor's Role
Whitney believes it's not just on the suppliers to keep non-compliant product out of the industry; the distributors are also responsible. Whitney referred to stories he hears almost every day about lost sales to non-compliant products that were just pennies less.
"It was about a penny difference," Whitney said. "The company that won the bid was subject to a recall and a lot of publicity. And [the supplier] didn't meet the requirements.
"So that one-cent difference cost the distributor a lot more than just one sale. [The distributor] lost the relationship with a client. When everyone's going for the immediate sale, they don't think of the long-term consequences."
Lage sees examples like this as a significant risk to the industry, and everyone, including distributors, should help to ensure end-users are getting a safe product.
"Everybody has a choice," Lage concluded. "As we know, we have thousands of suppliers, so we're not all the same, and not all the products are the same. They may look like it in a picture, but they're not always that way. I don't know why you wouldn't want to use a QCA supplier if you had the choice."
To learn more about QCA, visit www.qcalliance.org.
Amanda L. Cole is the editor-in-chief of NonProfit PRO. She was formerly editor-in-chief of special projects for NonProfit PRO's sister publication, Promo Marketing. Contact her at acole@napco.com.