Wal-Mart to Upgrade Compliance Process to Assist Paperwork
Wal-Mart Stores Inc. stated that it will be upgrading their vendor compliance process in China, which requires more documentation and using a computer based system to assist suppliers in managing associated paperwork.
The decision to upgrade the process came after China Central Television criticized the retail store for circumventing their quality control process and to fast rack some of their products that has high profit margins. Wal-Mart will ensure that they will be giving the correct documents and other requirements needed in place before products are sold in stores.
Documents will range from labels that reflect ingredients, test reports of the government, China compulsory Certificates, photographs, sample products and copies of manufacturing permits that show details that substantiate health claims such as organic or world famous, barcodes and papers on intellectual properties. This will require the organization, filing, retention and collection of around a million documents annually. Wal-Mart is now investing on a computer based system that enable vendors to upload the legal documents, which was piloted in September in 2013 and is ready for a broader based application process in its retail chain.
Wal-Mart handles more than 400 stores and warehouses in China which uses an expedited special approval process in specific circumstances in dealing with supplier changes or when switching distribution agents. The company will also be taking additional steps in addressing the supply chain concern.