QUALITY ASSURANCE 2017 NORDSTROM PRODUCT GROUP QUALITY ASSURANCE PROGRAM FINAL RANDOM INSPECTIONS July 2017
TABLE OF CONTENTS SECTION PAGE(S) Foreword 2 Introduction - NPG Quality Assurance Team 3 Final Inspection Procedure 4-24 Final Random Inspection Overview 4-5 NPG Approved Inspectors 6 Booking Form 7 Combined Inspections 8 Replenishment Inspections 9 Product Inspection Process 10-12 Product Inspection (AQL / Sampling Plan) 10 During the Booking Stage 11 Upon Inspectors Arrival at Factory 12 Carton Inspection 13-14 Carton Selection Process 13 Carton Inspection Process 14 Visual (Construction / Workmanship) Review 15 Defects Judgment for Visual Check 16 Measurements / Dimensions Review 17-22 Measurements / Dimensions Inspection Process 17-19 Recording Measurements / Dimensions 20-22 On Site Test 23 Defect Sorting and Carton Re-Sealing 24 Final Inspection Report 25-26 Inspection Report Instructions 25 Inspection Report Distribution 26 1
FOREWORD For additional information, contact: Nordstrom Product Group Quality Assurance 1617 6th Avenue, Suite 1000 Seattle, Washington 98101 USA npgqam@nordstrom.com This document offers guidance on effectively implementing the Nordstrom Product Group (NPG) Quality Assurance Program - Final Random Inspections. This document will be used in conjunction with additional sections of the NPG Supplier Manual located at: https://www.nordstromsupplier.com. 2016 Nordstrom, Inc., all rights reserved. CONFIDENTIAL: This document contains proprietary, trade secret, and confidential information which are the property of Nordstrom, Inc. This document and the contents may not be duplicated or disclosed to any other party without express authorization of Nordstrom, Inc. 2
INTRODUCTION NPG QUALITY ASSURANCE TEAM Quality Assurance Communication: Send all communication to NPG Quality Assurance Mailbox: npgqam@nordstrom.com Unless, requested otherwise. Quality Assurance Team: Title Name Email Address Quality Assurance Manager Open Position (continue to use this email address as the primary QA contact) npgqam@nordstrom.com Director, Operations Services Abby Bueler Abby.L.Bueler@nordstrom.com 3
FINAL RANDOM INSPECTION OVERVIEW Final Random Inspection Overview: To ensure Nordstrom is shipped only first quality products that meet or exceed Nordstrom Product Group (NPG) standards, a Final Random Inspection will be conducted on each Purchase Order. A Final Random Inspection ensures conformance to documents and samples. A Final Random Inspection consists of: Product Inspection Visual (Construction / Workmanship) Review Measurements / Dimensions Review Carton Inspection for FOB order only If the quantity status doesn t meet the statement(s) below, the inspector will call the Operating Office for further decision. For initial Final Random Inspection, the goods will be 100% finished, and 80% packed and ready to be shipped. For Re-Final Random Inspection, the goods will be 100% finished, and 100% packed and ready to be shipped. For Non-Third Party Inspectors: If the quantity status doesn t meet the statement(s) below, the inspector will email the NPG QA mailbox for further instruction. npgqam@nordstrom.com 4
FINAL RANDOM INSPECTION OVERVIEW Final Random Inspection Overview: NPG will be billed the cost of the Final Random Inspection with the Third Party Service Provider, including: Normal Working Days, Saturday, Sunday, Overtime and Traveling Time Charges. Under the Terms & Conditions in the Booking Form, the following exceptions will be at the factory s expense: Working / Traveling on Holiday Charge (Public holiday or local customs) Re-Inspection from Failed Initial Inspection Late Booking Late Revised Service Date Late Cancelation Inspection is Canceled A third party final random product inspection is required for ALL products except for the following product categories listed in the table below (Out of Scope): Division Accessories, Women's Specialized, Women's Active and Home (ACC/WSP) Product Categories Out of Scope Hosiery, Socks and Jewelry (ask Product Developer for Full Line Store Jewelry) Footwear All Categories Kids & Mens Hosiery, Socks and Ties Women s & Young Customer Young Customer Accessories Hardlines (including Jewelry) and Softlines For the products listed above, the expectation is that the factory will perform a final random inspection and be responsible for the quality of the product, including any major claims for quality. 5
NPG APPROVED INSPECTORS Inspectors Approved for NPG Final Random Inspections: All NPG Final Random Inspections and Re-Inspections will be conducted by one of four parties considered to be NPG approved Inspectors: Third Party Service Provider, contracted by NPG specifically for the purpose of conducting Final Random Inspections and Re-Inspections. Agent Inspector who has been certified by NPG after going through the Supplier Training Program (STP). Supplier Inspector who has been certified by NPG after going through the Supplier Training Program (STP). Select Off-the-Line (OTL) Suppliers who have been granted self inspection after meeting all requirements. Unless otherwise stated, all policies and procedures outlined in this document will apply equally to all four types of NPG approved Inspectors, hereafter generally referred to as Inspectors. New Inspector Approvals: This document does not include information about becoming a NPG Certified Inspector. The Supplier Training Program is on hold at this time. 6
BOOKING FORM Third Party Service Providers: When booking with a Third Party Service Provider, reference the booking form, booking form example, instructions, inspection offices and contacts on the NPG Supplier Manual: https://www.nordstromsupplier.com/npg/qualitymfr.html In order to initialize the Final Random Inspection, Supplier will complete and submit an Inspection Request Form to Bureau Veritas (BV), accompanied by documents and samples as outlined on the Inspection Checklist, at least 3-5 business days prior to the proposed inspection date (depending on location). The Booking Form contains fields that are mandatory. This critical information can be found on the Tech Pack and/or Purchase Order (PO): NPG Contact (Product Developer) Sourcing Category Nordstrom Performance Specification (NPS Number) Manufacturer RMS Number (Nordstrom System Generated number) Factory RMS Number (Nordstrom System Generated number) If the information that is input on the Booking Form is inaccurate, it may cause a delay during booking and subsequent issues may arise during the inspection. When sending in the booking form, include: A copy of the Nordstrom Purchase Order (manufacturer to factory Purchase Orders are NOT accepted) A Production Tech Pack, including the QA Audit Measurement pages (if available) A Production Test Report (if available) 7
COMBINED INSPECTIONS Combined Inspection Criteria: When there are multiple Purchase Orders, of the same style, in the same ship window, there will be one Final Random Inspection. When there are multiple Purchase Orders, of the same style, in different colors and prints, with the same measurement specs, in the same ship window, there will be one Final Random Inspection. When there are multiple children s size ranges or adult size ranges of the same style, there will be one Final Random Inspection. Example: BY210000LB (little boy) and BY210000BB (big boy) can be combined. Example: HA200000MI and HA200000MP can be combined. When combining Purchase Orders, the order quantity is the sum of the Purchase Orders and the ratio is dependent on the quantity of each Purchase Order. Example: BB = 400 units + LB = 200 units, total quantity = 600 units, so sample size = 80 units, 54 of which are BB and 26 are LB. Requests for Combined Inspection Reports: Supplier will complete one booking Form for each anticipated Final Inspection Report. Supplier will email their request to combine Purchase Orders when they submit the booking form, with all documentation for the Final Random Inspections. It is at the discretion of the Operating Office for Third Party Service Providers to determine if the Purchase Orders do, indeed, meet the criteria for combined inspections. For all other inspectors, contact the NPG Quality Assurance Mailbox, if you have any questions: npgqam@nordstrom.com 8
REPLENISHMENT INSPECTIONS Replenishment Inspection Reports: When there are multiple Replenishment Orders, of the same style, there will be one Final Random Inspection. Conditions: Supplier will write Replenishment and the Purchase Order number (if available) in the line where the Purchase Order number is to be listed. Example: Replenishment #05662197 Include a copy of the Nordstrom Purchase Order or Bulk Units Spreadsheet with the booking form. If nothing is attached, the request will be rejected. Final Random Inspection will be based on the total number of units that are shipped. At anytime, NPG reserves the right to request additional inspections for multiple replenishment orders with different production timelines. 9
PRODUCT INSPECTION PROCESS Product Inspection (AQL / Sampling PLAN) Overview: NPG uses the standard criteria of ANSI /ASQ Z1.4 (ISO 2859-1) Statistical Sampling Plan and Acceptance Quality Limit (AQL). The Lot Size is based on the number of units shipped. Sampling & AQL Criteria: Initial Final Random Inspections & Re-Inspections will be conducted using the following criteria: Sampling Plan - Single Inspection Procedure - Normal Inspection Level - General II AQL for Critical Defectives - Not Allowed AQL for Major Defectives - 2.5 AQL for Minor Defectives - N/A LOT SIZE SAMPLE SIZE AQL 2.5 Accept/Reject 26 to 50 5 0 / 1 51 to 90 20 1 / 2 91 to 150 20 1 / 2 151 to 280 32 2 / 3 281 to 500 50 3 / 4 501 to 1200 80 5 / 6 1201 to 3200 125 7 / 8 3201 to 10000 200 10 / 11 10001 to 35000 315 14 / 15 Over 35000 500 21 / 22 Pre-packed sets identified on PO: Pre-packs can contain 2 or more units. PO calls this total units which are the number of pre-packs. AQL is determined by total number of each individual unit: not pre-pack units. 10
PRODUCT INSPECTION PROCESS During the Booking Stage: The factory will provide the following to the third party office for the Final Random Inspection: Nordstrom Purchase Order Bulk Unit Spreadsheet (for Replenishment inspections) Production Tech Pack and QA Audit Pages (if available) or Line Sheet Passing Production Test Report(s): The factory will provide a passing test report for the product in a medium to dark colorway, and a passing test report for additional colorways (either in fabric or garment form). If any of these test reports is rated FAIL, please follow the below: If the test report is FAIL, but the supplier can provide a copy of an email or document showing that NPG accepted the failure, the inspector will leave a remark in the report and this does not impact the result of the inspection. If the test report is FAIL, and the supplier cannot provide an email or document showing that NPG accepted the failure, the inspector shall rate the result of the inspection as PENDING. If the factory does not provide the inspector with a passing test report for both the garment and additional colorways (either in fabric or garment form): the inspection will proceed the inspector will leave a remark in the report the inspection shall be rated as PENDING 11
PRODUCT INSPECTION PROCESS Upon Inspectors Arrival at Factory: The factory will provide the following to the inspectors for the Final Random Inspection: General Conformity Certificate (GCC), if applicable, or Children's Product Certificate (CPC) Approved Production Sample: In most cases, NPG Suppliers will not have a sealed/signed off sample. Based on NPG Product Developer comments, sample will be marked as Approve, Reject or Approve with Comments. Supplier will attach Tech Pack pages and/or Pre-Production meeting notes to sample. If Approved Production Sample is not provided, Inspector will not commence the inspection. Shade Band (for Softlines only): If Shade Band is not provided, Inspector will rate overall Final Inspection Report as Pass, and add comment. Approved Trims / Findings: If Approved Trims / Findings are not provided or on approved sample, Inspector will rate overall Final Inspection Report as PENDING FOR CLIENT DECISION, and add comment. Approved Packaging / Labeling UPC / Retail Ticket 12
CARTON INSPECTION Carton Selection Process: Inspector will: Select cartons that represent orders packed for all shipping locations (if multiple locations are included in the Purchase Order). Select samples that represent all colors and sizes included in the Purchase Order. Select the number of cartons based on the criteria listed below: If the total carton quantity 150, 10% of total cartons will be selected. If the total carton quantity >150, the inspector will review the total shipment of cartons, determine the square root ( ) of that number, and round up. Please see the chart below for example carton selections. # of Cartons (# of Cartons) 151 13 200 15 300 18 500 23 13
CARTON INSPECTION Carton Inspection Process: Inspector will: If the purchase type is FOB: Verify the total carton count of packed goods against the packing list. Check carton requirements and carton markings as outlined in the NPG Supplier Manual: https://www.nordstromsupplier.com/npg/edicompliance.html Open the cartons and verify the packed count, size and color of contents against the carton label. Determine if the actual quantity shipped will be the same as the quantity listed on the Purchase Order. If the result is outside of the allowable tolerance (± 5%), the inspection will be rated PENDING FOR CLIENT DECISION. Evaluate the Carton Marking: The following detail is required by Nordstrom to be included on the cartons: GS1-128 carton label DC (number) PO number Country of Origin Store number (if Store Pack) If any of these details is missing or incorrect on the label or carton markings, the inspection will be rated as FAIL. If there are other issues of non-compliance identified, the inspector will make a remark in the report, and the inspection will be rated as PASS. If the purchase type is LDP, DDP, FCA: The inspector will NOT conduct the carton inspection, as the product(s) will be shipped to a secondary location for final packing and shipping. The Inspector will rate the Carton Inspection Decision as PASS and remark this explanation in the Final Inspection Report. 14
VISUAL (CONSTRUCTION / WORKMANSHIP) REVIEW Visual Inspection Process: To perform a visual inspection, Inspector will: Select samples randomly from top, middle and bottom of carton Remove the product from package. Verify details against all documents and samples (refer to Inspection Check-List). In most cases, NPG Suppliers will NOT have a sealed/signed off Approved Production Sample. Based on NPG Product Developer comments, sample will be marked as Approve, Reject or Approve with Comments. Tech Pack pages and/or Pre-Production Meeting notes, attached to Approved Production Sample, are more accurate than sample itself. If the Inspector discovers a discrepancy between the Approved Production Sample and corresponding documentation (Tech Pack, email, etc.) for the label or trim, the Inspector will follow the documentation. Verify additional construction, workmanship, and labeling against NPG Supplier Manual. https://www.nordstromsupplier.com/npg/qualitymfr.html Mark and separate visual defects. Although the AQL / Sampling Plan accepts and rejects based on total defective units, the Final Random Inspection also serves as a tool to evaluate corrective action and overall factory performance. Therefore, Inspector will not stop after finding one defect on a unit, but perform a full evaluation of the unit, recording all discrepancies. This may result in the possibility of identifying multiple defects per garment. 15
VISUAL (CONSTRUCTION / WORKMANSHIP) REVIEW Defects Judgement for Visual Check Recording Defects: Defect definition: Critical: A defect likely to result in a hazardous or unsafe condition for an individual using the product or fails to meet mandatory regulations. Major: NPG considers all visual defects as MAJOR except Critical defect. Defect recording: Defect name + Defect location + Defect size 16
MEASUREMENTS / DIMENSIONS REVIEW Measurements / Dimensions Inspection Process: Softlines: Inspector will follow Measurement Methods outline in NPG Supplier Manual. Inspector will use a double coated fiberglass tape measure. Metal, plastic, fabric, or retractable tape measures are not allowed. Inspector is strongly encouraged to use a tape measure with both Imperial (inches) and Metric (centimeters), with ascending measurements on both sides. For apparel: Sample size: 4 pieces per size covering all colors (draw additional samples to cover all sizes and colors) Measure one garment per size, covering all colors/prints, for all Points of Measure Measure only Critical Points on remaining samples (number defined on the Measurement Chart). Critical Points of Measure will typically be indicated by a C in the POM Type column on the Graded Measurement Worksheet. If Critical Points of Measure are not indicated, they will be found in Critical POM list on NPG supplier site: http://nordstromsupplier.com/npg/techdesign.html Username: Nordstrom2010 Password: 2Buttons (password subject to change) If technical issues occur, please contact npgqam@nordstrom.com Failure Criteria If within a single size, all measured samples are found out of tolerance in same measurement point, or The total out of tolerance measurements points exceed 10% of the total measurements, or If within a single size, more than 50% of the same measurement points are found out of tolerance after repeat measurement. For Children Fitting Sleepwear, in addition to the measurement check, inspector is required to verify the actual findings of 7 key measurement points (chest, waist, seat, upper arm, thigh, wrist & ankle) should be equal to or less than the maximum dimensions given in the CPSC standards of 16 CFR 1615/1616. If any sample is found with one or more points out of the maximum dimension requirement, the result of measurement is FAIL. 17
MEASUREMENTS / DIMENSIONS REVIEW Measurements / Dimensions Inspection Process (continued): Softlines: For soft home: Sample size: same as apparel Failure Criteria: same as apparel Accessories: Sample size: 4 piece per size Sample size (if the product is one size only): apply AQL S-2 inspection level per size per style covering all colors. (see chart below) Failure Criteria: same as apparel (refer to the Sampling & AQL Criteria section under Product Inspection Process). Inspection Level S-2 (One Size Only): LOT SIZE SAMPLE SIZE 26 to 50 3 pieces, covering all colors 51 to 90 3 pieces, covering all colors 91 to 150 3 pieces, covering all colors 151 to 280 5 pieces, covering all colors 281 to 500 5 pieces, covering all colors 501 to 1200 5 pieces, covering all colors 1201 to 3200 8 pieces, covering all colors 3201 to 10000 8 pieces, covering all colors 10001 to 35000 8 pieces, covering all colors Over 35000 13 pieces, covering all colors Footwear: no need to conduct the measurement. 18
MEASUREMENTS / DIMENSIONS REVIEW Measurements / Dimensions Inspection Process (continued): Hardlines: Sample size: 3 samples, at least 1 sample per style. Result judgment: PASS if all actual measurements are within tolerance; FAIL if any actual measurement is out of client tolerance, or PENDING FOR CLIENT S DECISION if client has not provided tolerance measurements or if actual measurements are out of BV tolerance (±3% for dimension 1M or less, ±1.5% for dimension more than 1M). 19
MEASUREMENTS / DIMENSIONS REVIEW Recording Measurements / Dimensions: For Softlines: If provided, Inspector will use the QA Audit page of the Tech Pack for recording measurements. If not provided, Inspector will devise a measurement form. Please see the supplier site for examples: http://nordstromsupplier.com/npg/qualitymfr.html Record the difference which the actual finding the required data, e.g. for 28 half bust in the tech pack specification, the actual finding is 28 ½, then + ½ will be recorded in the measurement chart. See example below: For Hardlines: The actual measurements are recorded in the on-site section. 20
MEASUREMENTS / DIMENSIONS REVIEW Forms for Recording Measurements / Dimensions: Third Party Inspectors Follow this example of a filled out form: Please see the supplier site for an example: http://nordstromsupplier.com/npg/qualitymfr.html 21
MEASUREMENTS / DIMENSIONS REVIEW Forms for Recording Measurements / Dimensions (continued): For All Other Approved Inspectors (Agent, Direct, STP and OTL) Please see supplier site for examples of forms filled out: http://nordstromsupplier.com/npg/qualitymfr.html 22
ON SITE TEST On Site Test: Metal Detection Test: For ALL children s products (12 YEARS AND UNDER & Size Boys/Girls 0-20). Sample size: all samples for visual check Failure criteria: Not Allowed. Carton dimensions/weight: Sample size: 1 sample per type of master carton Recording: all actual measurement data Barcode verification: Sample size: 3 samples but at least 1 sample per each different barcode Failure criteria: Not Allowed. 23
DEFECTS SORTING AND CARTON RE-SEALING Marking & Separating Defects: Inspector will mark all quality defects or deviations with colored inspection tape or defect stickers as the inspection is performed. Inspector will separate the defective units into one stack, and the factory will try to repackage as many of the good units, as possible, into the carton(s). Once this is complete, the Inspector will seal the complete/full cartons. The re-sealing of the selected carton: 1 ) Generic re-sealing method Seal the carton with contrasting tape (BV tape or other) in an H pattern. 2) Special re-sealing method If any or all selected cartons could not be re-sealed according to the above requirement due to any reason/condition (e.g. factory refuse to seal the cartons, factory cannot re-pack immediately as re-processing is needed, overtime will be caused etc.): Seal the carton with contrasting tape (BV tape or other) on one of side fold edge. 3) Reporting Inspector should add a remark to record the cartons number which are resealed by inspector in report. Inspector must record detailed reasons which should be from and claimed by factory, or that is overtime will be caused in inspection report for not sealing some or all the selected cartons by above two sealing methods, and the inspection result can t be affected due to this reason. Anti-Counterfeiting (AC) Sticker: AC stickers must be applied by the inspector(s) when the inspected samples PASS both workmanship and on site test verifications. The on-site test is for product (i.e. measurement, weight) The AC sticker will be applied to the PASS product The on-site test is not product (i.e. carton dimension/weight measurement, carton drop test etc.) The AC Sticker will not be applied to anything. 24
FINAL INSPECTION REPORT INSPECTION REPORT INSTRUCTIONS The Initial Inspection: Third Party Inspectors to use Inspection Report: DDEI/SD069 Re-Inspection: Third Party Inspectors to use BV Short Inspection Report: DDEI/SD069-R Re-Inspection information stand along section: SD 168 (In case the Re-Inspection Report format hasn t the section). Single Inspection Reports: In most scenarios, each Purchase Order will have one Final Random Inspection. Multiple Inspection Reports: In most scenarios, where multiple styles are on one Purchase Order, there will be multiple Final Random Inspections. When there are multiple Purchase Orders, of the same style, in different fabrications, with different measurement specs, there will be multiple Final Random Inspections. Non-Third Party Inspectors: Inspectors will utilize the Final Audit Form found on the NPG Supplier Manual: http://nordstromsupplier.com/npg/qualitymfr.html 25
FINAL INSPECTION REPORT INSPECTION REPORT DISTRIBUTION On Inspection Date: The inspector will: Leave the draft report with the factory. Report Email Distribution: On the next business day following completion of the Final Random Inspection, the third party office will: Send a formal report to the Supplier who requested the service. Upload the report into Third Party Inspectors System. Send only Held or Failed formal Reports to NPG Quality Assurance Mailbox: npgqam@nordstrom.com Email Subject Header: For an initial Final Random Inspection, the email subject header must be as follows: Rating VPN (Style) Number PO Number Factory Name Year Unique Identifier for Tracking, as assigned by the Inspector or Third Party Service Provider Example: Fail GL000000BG 12345678, 87654321 ABC Factory 2015 ABC123 For Re-Inspection, the email subject header must be as follows: Rating Re-Inspection VPN (Style) Number PO Number Factory Name Year Unique Identifier for Tracking, as assigned by the Inspector or Third Party Service Provider Example: Fail Re-Inspection GL000000BG 12345678, 87654321 ABC Factory 2015 ABC123 26