China: Cracking down on Pollution Inspections creates scaling complications.

The pressure to meet better air quality goals in Chinese cities could cause large-scaling complications for existing and future supply chain activities.

In a recent article by Bloomberg BNA, it was reported that some factory operations have come to a complete halt amidst the wide-sweeping environmental investigations.

“The situation could linger for months as authorities near major urban areas around Beijing, Shanghai and South China’s Pearl River Delta push to meet cleaner air quality goals laid out in a national air pollution action plan launched in late 2013, which expires at the end of the year” (bna.com 2017).

Considering the volume of production managed in Chinese factories- servicing some of the largest companies around the globe - these investigations will impact thousands of companies’ efficiency when it’s all said and done. This could cause massive inventory delays, in turn- heavily impacting quarterly/yearly sales for some household brand names.

These investigations, environmental audits and financial audits come at a surprise for some, but the writing has been on the wall. Worldwide, there has been increasing consumer demands on supply chain proficiency to include sustainable aspects- benefiting business, but not compromising on promises to people and planet. Not to mention, companies have delayed inspections to meet standards set in 2013 until Q3 of 2017; procrastination at it's most damning of points. 

“The Ministry of Environmental Protection said Sept. 5 that more than 5,600 companies had already been punished in the fourth round of inspections, totaling 280 million yuan in fines ($43 million)” (bna.com 2017).

Though investigations could make for a loss of revenue-stream due to delayed shipping times, halted manufacturing, and/or the shutting of factories, more sustainable/compliant factory operations will likely be the output of investigation.

Short-term loss must take place to create long-term, multidimensional, gain.

Despite the good intentions of the pollution inspections, some business leaders are less than amused.

Michael D. Crotty, president of Golden Pacific Fashion & Design Co., Ltd. told, Bloomberg BNA Sept. 6. “We have a large project we are working on and shipment is due, and we are having a hard time getting to a ship date.”

Crotty worries that the closing of certain factories will force not only wide-sweeping negative implications for his business, but for other small factories due to the cross-organizational codependency that exists within many regions of Chinese manufacturing districts. 

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