Wal-Mart Stores Inc said yesterday it would impose stricter quality standards on its Chinese suppliers after a series of product scandals involving Chinese businesses.
The world's largest retailer would also enforce higher environmental standards, it said.
Wal-Mart had asked its suppliers and importers to report the name and location of every factory that turned out products available in its stores, Mike Duke, vice chairman of Wal-Mart's international division, told a conference in Beijing.
He said Wal-Mart suppliers would be responsible for their subcontractors' work and products. "We expect you to have the answers and to take ownership in getting to the root of the problem," Duke said, describing requirements he said would begin from next month.
Suppliers who failed to meet the standards would be dumped from Wal-Mart's Chinese supply chain if no improvements were made.
Apparel would be the first sector to adopt the new practices, which would be applied to all retail products by the end of next year, he said.
The move would also ensure Wal-Mart's suppliers were more transparent and had greater social responsibilities, Duke added.
China has been active in restoring market confidence after a slew of food and product safety scandals. The latest scandal, in which the toxic chemical melamine was added to infant formula and milk produced by 22 Chinese companies, killed four babies and caused more than 54,000 others to fall ill.
Wal-Mart yesterday also renewed agreements with suppliers requiring factories to abide by local laws and regulations and meet high social and environmental standards. The agreements would be enforced among Chinese suppliers over the next three months and expanded to suppliers globally by 2011, the company said. Wal-Mart would also monitor factory air emissions, management of toxic substances and disposal of hazardous waste, it said. Wal-Mart has more than 60,000 suppliers worldwide, and procures about US$9 billion worth of goods from China.
(Shanghai Daily October 23, 2008)
