Document Sample
					                                                                  COSTCO WHOLESALE
                                                                FACTORY EVALUATION
COSTCO WHOLESALE                             CPS-I NUMBER:                                10051050018
NON-FOODS QUALITY ASSURANCE                  CLIENT DEPT.:                                31
999 LAKE DRIVE                               EVALUATION DATE:                             APR 22, 05
ISSAQUAH, WASHINGTON 98027                   ISSUE DATE:                                  APR 27, 05
                                             ADDENDUM DATE:                               N/A

BCC:                                OVERALL RATING
                                                                            *See Below Note
                                               CORRECTIVE ACTION REQUIRED                                        X
                                             Note: Rating is based on factory evaluation results. Final acceptance, or
                                             rejection is per Costco only.
                                                        FACTORY EVALUATION RESULT

                                             Evaluation Rating:                                  85.6%
                                             Points Achieved:                                     107
                                             Points Possible:                                     125
     CV EVALUATION                           Critical Failures Found:                              0
                                                 * Note: Any critical failures automatically result in evaluation failure.*

Type of Evaluation:                     Evaluation
                                        Other (please specify):
                                        Cashmere Evaluation (add cashmere evaluation addendum)

Product Description: Ladies V-Neck Tank
Factory Name (English):     Suzhou Jienisi Textile Co., Ltd
Factory Name (Chinese):     /
Factory Address (English): No.111, Jinshang Road, Jinxi Town, Kunshan, Jiangsu, China
Factory Address (Chinese): /
Factory Tel. Number: 86-512-57225318                Factory Fax Number: 86-512-57226108
Vendor Name: 525 Made in America                            Factory Email:
Costco QA Project Person: Becky Berg                      Costco Item No.: 857429
                                                          Vendor Style no: W1694A
Country of Origin:    China                       Country of Destination: USA
Previous Report No: N/A                                    Charge Vendor: Yes: X        No:
Addendum Report:      Yes:        No: X
Reason For Addendum:        N/A
Date of Audit: Apr 22, 05                           Auditor: Buick Bie/Danny Chen
                                                                               Costco Wholesale
                                                                       Report No.: 10051050018
                                                                      Evaluation Date: Apr 22, 05
                                                                                      Page 2 of 23

                                        Total Points     Total Points Achieved
A. Metal Detection Procedures                 4                   4

B. Facilities & Working Environment         13                    13

C. Quality Control System                   12                    10

D. Incoming Material Inspections            13                    11

E. In-Process Quality Control               19                    16

F. Final Inspection                         13                    7

G. Finishing and Packaging                  16                    15

H. Non-Conforming Materials                  8                    6

I. Communication, Documentation             12                    11
   Control and Work Improvement

J. Handling of Complaints                    7                    6

K. Trans-shipment                            8                    8

              Grand Total Possible:         125
              Grand Total Achieved:                              107

Executive Summary:
The factory had taken effective corrective actions to eliminate the non-conformity according to
the corrective plan, but the factory still need conduct corrective work as recommendations.

Factory’s address on booking form is No.111, Jinshang Road, Jinxi Town, Kunshan, Jiangsu,
China, which is different from the one on business license, East Side of Jinshang Road, Jinxi
Town, Kunshan, Jiangsu, China.

Recommendations For Improvement:
1. Written detail plan demonstrating how safety requirements on products are checked in house
should be provided.
2. The final inspection reports should be kept including package and function inspection.
3. All inspection instructions should been kept by inspector on site.
4. All inspection defects should be analyzed and corrective action should be taken to eliminate
the problem encountered.
5. Tearing test should be conducted for fusing parts.
6. Mechanical Test should be conducted and relevant records should be kept well.
7. In case of subcontracting, the factory should send QC to the subcontractor’s site to conduct
inspection, relevant records should be kept.
                                                                                      Costco Wholesale
                                                                              Report No.: 10051050018
                                                                             Evaluation Date: Apr 22, 05
                                                                                                 Page 3 of 23

                                            Factory Information

COMPANY ORGANIZATION                                     NAME                          Met during audit?
Owner                                               Mr. Qian Haojie                       Yes            No
General Manager                                     Mr. Qian Haojie                       Yes            No
Sales Manager/Marketing Manager                    Mr. Wu Shenghong                       Yes            No
Plant Manager                                                                             Yes            No
QA Manager                                           Ms. Gu Meijuan                       Yes            No
Production Manager/Factory Manager           Mr. Shen Binglin-Woven Section,              Yes            No
                                             Mr. Ji Xueliang-Knitted Machine

Factory has been in operation since     May, 1994
                                Full time          Part time           Temporary            Contract
1.    No. of workers            400
2.    Cutting Room              18
3.    Sewers                    240
4.    Packing                   14
5.    Clerical                  2
6.    Mechanics                 5
7.    Supervisors               6
8.    Engineering Staff         14
9.    Finishing Staff           22
10.   Warehouse                 10
11.   Inspector                 33

Monthly Production Capacity           850,000         Required Lead        30-60 days
                                      pieces          Time
Main Products Produced:
Woven: Shirt, Pant
Knitted: T-shirt, Shirt, Children Garment, Pant

Category Quantity Category Quantity Category                          Quantity     Category      Quantity
N/A      N/A      N/A      N/A      N/A                               N/A          N/A           N/A

Operations                In house      Outsourcing       Operations               In house     Outsourcing

Spinning                  N/A                             Buttoning                X
Weaving                   N/A                             Hand stitching           X
                                                                                         Costco Wholesale
                                                                                 Report No.: 10051050018
                                                                                Evaluation Date: Apr 22, 05
                                                                                                     Page 4 of 23
Knitting                 N/A                                 Pressing                  X
Cutting                  X                                   Folding                   X
Sewing                   X                                   Packing                   X
Linking                  X
Embroidery                             X
Fusing                   X                                   Others:
Trimming                 X                                   Printing                                     X
Washing                                X


1.   Masonry                   Yes            No     9.      Canteen                        Yes               No
2.   Steel                     Yes             No    10.     Quarters                       Yes               No
3.   Number of          3 buildings with 1 floor     11.     On site Medical station        Yes               No
     Floors                were empty (total
                     2,640M2), 1 building with 1
                     floor used for living quarter
                      (total 1,166M2), 1 building
                          with 1 floor used for
                      canteen (total 1,320M2), 1
                     building with 3 floors used
                        for office (4,753M2), 1
                       building with 1 floor used
                          for woven garment
                      (3,840M2), 1 building with
                        1 floor used for knitted
                          garment (3,840M2)
4.   Square Meter               17,559M2             12.                                    Yes               No
5.   Electrical                Yes            No     13.                                    Yes               No
     Light Source
6.   Air                       Yes            No     14.                                    Yes               No
7.   Fire                      Yes            No     15.                                    Yes               No
8.   First Aid                 Yes            No     16.                                    Yes               No

Type of ownership of factory (i.e. Taiwan owned, HK owned,
Chinese owned, Local Chinese Township Enterprise, Etc.):                Chinese private enterprise

If the factory is a Foreign-Investment Factory,           At All Times
Number of Home Country Staff at factory:                        % of the time N/A

Title & Responsibilities of home country staff:      N/A
                                                                                    Costco Wholesale
                                                                            Report No.: 10051050018
                                                                           Evaluation Date: Apr 22, 05
                                                                                              Page 5 of 23
                                Factory Background Information

   1. Who are the owners / principles of this factory? Mr. Qian Haojie/General manager
       What are their names / titles?
   2. If factory is located in China, are the owners from:
           Taiwan                   Hong Kong                Chinese government-owned
           Chinese “private” enterprise                       Other:
   3. If factory is Chinese government owned, what is the name of the Chinese government unit? N/A
   4. If the factory is a Chinese-Chinese “private” enterprise, what are the work experience and
       backgrounds of the owners? up to 30 years garment experience.
   5. How many years has this factory been at this particular location? 10 months (since July, 2004)
   6. What is the factory’s approximate annual FOB export dollars (US$) for the past 3 years? 2002:
   1,076,653.77US$, 2003: 2,219,230.13US$, 2004: 796,542.93US$.
   7. How many years has this factory been manufacturing the same or similar item(s) as that being
       sold to Costco? Never (first time)
   8. What are the names of the factory’s key customers in the U.S. / Canada / Europe? Wal-Mart,
   JC-Penney, TCW, Globe-tex, Newtex.
   9. What are the names of any OEM customers (i.e. brand name customers)? 525 Made in America
   10. What is the factory’s monthly capacity (# of 40’ containers) and at what percentage capacity is its
       current output? (i.e. Is it 90% full? Is it 75% full?) 5 of 40' container, 50% full
   11. Is the factory vertical or nearly vertical? Explain: The factory is only a garment processing
       factory, main processes include cutting, sewing, pressing, finishing, packing etc.
   12. If factory is primarily an assembly / finishing / packaging operation, who are the other key sub-
       factories involved with this product? N/A


Total # of Sewing Machines:        464 sets
Total # of Serger                  190 sets
(overlocking) Machines:

Listing of all major machinery & Equipment at factory relevant to the manufacturing of the
product. (Do not list sewing / serger machines)
Brand Name/Type                    Manufacturing                              # of         If Relevant
  of Machinery        Model #        Country              Purpose             Units         Capacity
Fabric cutter                      China           cutting fabric           3 sets
Thread collector                   China           collecting thread        2 sets
Fusing machine NHJ-600             China           fusing                   2 sets
Snap machine     ZN90, MS-         China           snap locking             12 sets
Electric cutter  NZC-160K          Japan,          cutting fabric           8 sets
Metal detector                     Japan           metal detection          2 sets
Fabric                             China           fabric inspection        2 sets
Eyehole locking                    Japan,          eyehole locking          7 sets
machine                            China
                                                                                               Costco Wholesale
                                                                                       Report No.: 10051050018
                                                                                      Evaluation Date: Apr 22, 05
                                                                                                             Page 6 of 23
Vaccum ironing         YTT-B-2           China            ironing                       102
machine                                                                                 sets
Button machine                           Japan            stitching buttons             1 set
Hand metal                                                metal detection               1 set

PERSONS TO WHOM QC/QA MANAGER REPORTS:                                           Production Manager
Does QC or QA Manager have other job responsibilities in
other areas? If yes, please list.                                                         Yes                     No

Other Job Responsibilities:         N/A

Current Major Customers:            525 Made in America

    These 4 questions must be answered Yes or No. N/A cannot be used as an answer for any question in this section.
Costco requires some form of metal detection for all garments.
    1. Are metal detectors used?                                                                  Yes             No
       Type of metal detector: Convey type, hans
       Quantity available for use: 3 sets
        Frequency of Calibration:            1 time per 1 hour
        Who Calibrates the Equipment: packing workers

    2. Are needle guards used?                                                                    Yes             No

    3. If needle guards are used, are they used consistently on all machines?                     Yes             No
    4. Needle replacement policy in effect?                                                       Yes             No
          Explain policy:       Broken needle parts are requested to send to warehouse keepters and
                                taped on paper as records, only after all broken parts are received, the
                                warehouse keepers would distrubute a new needle to sewer.

Note: Factories making children’s garments are required to have a metal detector. Based on the
production method for adult garments, if the factory does not have a metal detector but they do
use needle guards, have a needle replacement policy or some other means of ensuring no metal is
left in the garments, Costco may approve the factory despite not having a metal detector.

* Denotes critical questions.
Item #:                        Remarks:
                                                                                       Costco Wholesale
                                                                               Report No.: 10051050018
                                                                              Evaluation Date: Apr 22, 05
                                                                                                Page 7 of 23

    1. Are fax, email, and telephone utilities available?
                                                                                      Yes         No
    2. Are the working areas clean with no obstructions?
                                                                                      Yes         No

    3. Is the lighting and ventilation condition adequate?                            Yes         No

    4. Is there a written machine maintenance schedule?
                                                                                      Yes         No

    5. Does the factory possess a strong maintenance team to back up
    production?                                                                       Yes         No

    6. Does each machine have a maintenance record hung on it?
                                                                                      Yes         No

    7. Is there a time card recording machine?
                                                                                      Yes         No

    8. Are the aisles, exits and stairways kept clear at all times?
                                                                                      Yes         No

    9. Are workers wearing uniforms and need to change working shoes
    before entering into the production floor?                                        Yes         No

    10. Is there at least one well-stocked first aid kept on every factory floor?
                                                                                      Yes         No

     11. There are no workers smoking at the production area observed
    during evaluation.                                                                Yes         No

    12. There are no workers drinking or eating at individual workstations?
                                                                                      Yes         No
    13. If factory caters lunch/ meal to the workers, is kitchen safe and

                                                                                      Yes         No

Rating: Facilities: Score 1 Point for each marked yes.                                      Total: 13 / 13

Item #:                     Remarks:
4                           Written machine maintenance schedule was available.
6                           Maintenance records were hung on the machines.
9                           Uniform and working shoes were provided for the workers.
                                                                                       Costco Wholesale
                                                                               Report No.: 10051050018
                                                                              Evaluation Date: Apr 22, 05
                                                                                                Page 8 of 23
10                           Medicine was equipped in the first aid kit.

     1. Is factory operating a formal internal quality control procedure on its       Yes         No

     2. Are all QA staff a separate team and different personnel from the             Yes         No
     trimming and inspection workers?

     3. Are there adequate number of QA staff to deal with the quality and            Yes         No
     quantity of spot-checking?

      4. Is the QA manager authorized to stop production when there is                Yes         No
     serious quality problems with production?

     5. Are there adequate internal training programs provided for all quality        Yes         No
        control personnel involved?

     6.   Are there adequate traceable training records?                              Yes         No

     7.    Are the factory Q.C. personnel certified before they perform their job     Yes         No
          as outlined in the Q.C. procedures?

     8.    Does the factory use international, national, client or its own            Yes         No
          approved standards to perform in-house quality control?
          Which used:_Client standards and owned approved standards_____

     9.    Does factory have a detailed written plan demonstrating how safety         Yes         No
          requirements on products are checked in house?

     10. Do detailed Q.C. reports reflect that the products are to be properly        Yes         No
         checked beforehand?

     11. Does quality controller fully understand factory quality policy,             Yes         No
         quality consciousness, and the importance of the quality assurance

     12. Does Q.C. have adequate basic knowledge and expertise on products            Yes         No
         to be made and general manufacturing technology?

Rating: Quality Control System: Score 1 Point for each marked yes.                          Total: 10 / 12

Item #:                      Remarks:
7                            The QC was certified.
9                            No detailed written plan demonstrating how safety requirements on
                             products are checked in house was available.
                                                                                         Costco Wholesale
                                                                                 Report No.: 10051050018
                                                                                Evaluation Date: Apr 22, 05
                                                                                                  Page 9 of 23
10                          The final inspection reports were not reports; package inspection and
                            function inspection were not shown in the reports.


1. Does factory perform incoming fabric inspection procedures?                          Yes        No

2. Are incoming and outgoing raw materials registered to let stocks check?              Yes        No

3. Are raw materials properly labeled, stored, and traceable?                           Yes        No

4. Are raw materials kept in controlled storerooms to avoid theft, loss, and            Yes        No
   any deterioration of quality?

5. Is there a fabric inspection machine?                                                Yes        No

6. Does the factory have its own laboratory or light box?                               Yes        No

7. Is the inspection-sampling schedule adequate and can the quality of the              Yes        No
    product be guaranteed with confidence?

8. Are adequate inspection records maintained to prove products are checked             Yes        No
   and meet all requirements?

9. Are there adequate written inspection instructions available as guidelines to        Yes        No

10. If testing equipment is needed during inspection, is it sufficient and in           Yes        No
   good condition?

11.Is there a systematic control on the non-conforming raw materials and is it          Yes        No

12. Are faulty fabrics / raw materials well separated in order to avoid mixing?         Yes        No

13. Are different shade lots of fabrics or raw materials well separated in order        Yes        No
   to avoid mixing?

Rating: Incoming Inspection: Score 1 Point for each marked yes.                               Total: 11 / 13

Item #:                     Remarks:
6                           The factory had bought light box.
8                           Only visual and weight inspection records were kept available, but for
                                                                                        Costco Wholesale
                                                                                Report No.: 10051050018
                                                                               Evaluation Date: Apr 22, 05
                                                                                              Page 10 of 23
                            color fastness, color shade etc were not available on site.
9                           Written inspection instructions were kept in office.


    1. Are all toolings fully tested and evaluated with all measurements and           Yes      No
       safety issues?

    2. Are samples of pilot run carefully be reviewed by engineers and                 Yes       No
       quality staff to see all safety aspects are being met?

    3. Is IPQC sufficient to prepare for mass product?                                 Yes       No

    4. Is there any documentation either from the engineering, QC                      Yes       No
       department, or top management to authorize mass production?

    5. Are there line patrols by quality controllers or other means to monitor         Yes       No
       the compliance of the product to meet quality and safety

    6. Does factory use international or clients standards to carry out in-            Yes       No
       process inspection? Are there records?

    7. Do records reflect the action taken on the rejected lots?                       Yes       No

    8. Do records show rejected lots are well identified and segregated from           Yes       No
       accepted lots?

    9. Are rejected lots well-identified and segregated from accepted lots?            Yes       No

    10. Are there adequate, clearly written criteria/instructions available for        Yes       No
        inspectors to follow?

    11. Are there adequate approved samples attached to all areas to give              Yes       No
        inspectors or workers a guideline?

    12. Are the inspection and test equipment sufficiently reliable to verify          Yes       No
        the conformance of the semi-finished final product?

    13. Is the testing equipment calibrated accurately and is it sufficient?           Yes       No

    14. Are the inspection defects charted, analyzed, and monitored to                 Yes       No
        improve the problems encountered?

    15. Are shade batches separated in a lay while cutting?                            Yes       No

    16. Are cutting panels checked before they are put into the sewing                 Yes       No
                                                                                     Costco Wholesale
                                                                             Report No.: 10051050018
                                                                            Evaluation Date: Apr 22, 05
                                                                                             Page 11 of 23

     17. Is there a tearing test for fused parts?                                   Yes         No

     18. Are cutting panels properly placed into containers / boxes?                Yes         No

     19. Are workers wearing protective gloves while they are operating             Yes         No
         cutting machines?

Rating: In-Process Quality Control: Score 1 Point for each marked yes.                    Total: 16 / 19

List the various in-line QC Checks:
                                                Cut panel check

                                                In-sewing line inspection

                                                Randomly in-line check

                                                Size measurement

Item #:                      Remarks:
1                            All sharp tools were tied on the workstations.
10                           The inspection instructions were kept in office.
                             Adequate approved samples were attached to all area to give inspectors
11                           or workers a guideline.
                             Defects were analyzed, but no corrective action was taken to eliminate
14                           the problem encountered.
17                           No tearing test was done for fused parts.
19                           All workers were wearing metal gloves during cutting.

     1. Does factory QC perform internal final inspections on finished              Yes        No

     2. Are there written formal inspection reports and are they properly filed     Yes         No
        and traceable to review quality of products?

     3. Are customer drawings/specifications readily available from quality         Yes        No
        control or engineering department on request?

     4. Does factory perform internal mechanical tests during production to         Yes         No
        safeguard the product’s quality?

     5. Are there records to show factory has ever performed such                   Yes         No
        mechanical safety tests?
                                                                                       Costco Wholesale
                                                                               Report No.: 10051050018
                                                                              Evaluation Date: Apr 22, 05
                                                                                               Page 12 of 23
      6. Are adequate inspection and testing records maintained?                      Yes         No

      7. Does the factory inspect 100% of the product?                                Yes        No

      8. Is the sampling size of products for final inspection adequate enough        Yes        No
         to show the confidence of safe products?

      9. Are there normal procedures to require acceptable inspection reports         Yes        No
         to authorize and shipment of the products?

      10. Does factory perform 100% check on functionality? If not, is the            Yes         No
          current procedure sufficient?

      11. Are measurement audit conducted during final inspection?                    Yes        No

      12. Are dummies used to check the fitting and hanging aspects of finished       Yes        No

      13. If some operations are sub-contracted out, will the factory send its QC     Yes         No
          to the sub-contractor’s site for monitoring the quality and are there
          any out-inspection records to proving that?

Rating: Final Inspection: Score 1 Point for each marked yes.                                Total: 7 / 13

Item #:                      Remarks:
2,6                          Only visual inspection items were recorded in final inspection reports,
                             the package inspection and function inspection information were not
                             shown in the inspection reports.
4,5                          No such evidence was available.
8                            Metal detection would be conducted for all customers.
10                           No function checking evidence was available.
12                           Dummies were used to for final inspection.
13                           No such evidence was available.
                                                                                     Costco Wholesale
                                                                             Report No.: 10051050018
                                                                            Evaluation Date: Apr 22, 05
                                                                                           Page 13 of 23

  1. Are packed master cartons well stored in a covered area or a good              Yes       No
     shelter to keep from sunshine, to avoid being flooded or rained upon
     and protected from dirt & rodents?

  2. Is there adequate safeguard to prevent another company’s products              Yes       No
     from being packaged into master cartons?

  3. Is there adequate control to prevent any defective or rejected products        Yes       No
     from being packed into master cartons?

  4. Are semi-finished products well segregated from final finished                 Yes       No
     products in the packing area?

  5. Are finished products packed into master cartons immediately when              Yes       No
     case product count has been done?

  6. Do workers wear gloves, hats/caps when necessary?                              Yes       No

  7. Is the method of product count into master cartons accurate?                   Yes       No

  8. Is the current procedure acceptable to avoid the possibility of shortage       Yes       No
     of product?

  9. Is the packaging area tidy and free of contaminants?                           Yes       No

  10. Is there any equipment to use for stamping the date code, lot code,           Yes       No
      and case number?

  11. Is filter connected to the water pipe used for steam boiler in pressing       Yes       No

  12. Have the steam boilers been examined periodically by outside-                 Yes       No
      certified engineers and with certificates to prove it?

  13. Is cleaning liquid and agents properly stored to avoid fire catching or       Yes       No
      inhaling by workers?

  14. Is weighing machine used to take the actual weight of the cartons?            Yes       No

  15. Is barcode scanner used to verify the correctness of barcode stickers         Yes       No
      on packages (if applicable)?

  16. Are finished cartons put on pallets to avoid direct contact with floor?       Yes       No

  17. If laundry or washing machines are used, are there any written                Yes       No           N/A
  procedures for wastage water treatment?
                                                                                         Costco Wholesale
                                                                                 Report No.: 10051050018
                                                                                Evaluation Date: Apr 22, 05
                                                                                                 Page 14 of 23
Rating: Packaging: Score 1 Point for each marked yes.                                         Total : 15 / 16

Item #:                      Remarks :
6                            Gloves, hats/caps were provided for packing workers.
13                           Cleaning liquids were stored in workspace without MSDS and proper
15                           Barcode scanner was available.
16                           Finished cartons were put on pallets.


     1. Is non-conforming material sufficiently identified?                             Yes         No

     2. Do records show that reworked parts/materials have been re-inspected            Yes         No
        to comply with standards?

     3. Is scrap material handled satisfactorily?                                       Yes         No

     4. If reclaimed materials are used, is there adequate identification and           Yes         No
        checking to specification?

     5. Can the factory demonstrate how they handle the non-conforming                  Yes         No
        materials such as products that fail the mechanical tests?

     6. Can the factory supply solid proof to guarantee non-conforming                  Yes         No
        materials or products are absolutely segregated from normal
        production and none will be mixed into the production? Or re-selling
        with brand labels.

     7. Is non-conforming material properly segregated at all stages?                   Yes         No

     8. There are no signs that workers are wearing garments identical to               Yes         No
        garments being produced?

Rating: Non-Conforming Materials: Score 1 Point for each marked yes.                          Total:   6/8

Item #:                      Remarks:
2                            No such records were available showed on inspection records.
5                            No such evidence was available.
                                                                                       Costco Wholesale
                                                                               Report No.: 10051050018
                                                                              Evaluation Date: Apr 22, 05
                                                                                             Page 15 of 23


  1. In the case of authorized subcontracting, does factory provide                   Yes       No
     adequate supervision and specifications to ensure the compliance to
     the requirements of client standards?

  2. Is there an adequate and formal system for receiving purchase orders,            Yes       No
     tooling, and equipment?

  3. Are pre-production samples or pilot lots evaluated in writing and with           Yes       No
     comments attached on it?

  4. Are approved drawings and specifications used properly, filed in                 Yes       No
     chronological sequence, traceable and easily available?

  5. Do factory management and key staff understands English                          Yes       No
     sufficiently to ensure communication?

  6. Does factory have clear instructions to its departments to delegate              Yes       No
     authority to stop production if the products do not meet requirements
     of client’s standards?

  7. Is client technical information clearly identified with adequate                 Yes       No
     controls throughout production process?

  8. Does the factory realize that all the technical information related to           Yes       No
     the client’s product is confidential and will not be exposed to other

  9. Does factory work closely and efficiently with client on the assigned            Yes       No
     project to advise and discuss any failure on processing problems?

  10. Do records show that regular pre-production meetings would be held              Yes       No
      before a new style is firstly put into production?

  11. Are the factory rules and the labor ordinance posted on the notice              Yes       No
      board so to let the workers know their rights and privileges?

  12. Do records show the daily production output of each section?                    Yes       No
                                                                                  Costco Wholesale
                                                                          Report No.: 10051050018
                                                                         Evaluation Date: Apr 22, 05
                                                                                          Page 16 of 23
Rating: Communication, Documentation Control and Work Movement:
         Score 1 Point for each marked yes.                                            Total: 11 / 12

Item #:                     Remarks:
1                           No evidence to prove the factory provide adequate supervision,
                            subcontractor to ensure the compliance to the requirement of the client
8                           The customer’s specifications were valid; the factory had realized that
                            the customer’s documents would not exposed to other clients.
10                          Regular pre-production meetings records were available.


     1. Are customer complaint handled by management?                            Yes         No

     2. Is factory operating a formal handling of complaint procedure?           Yes         No

     3. Are the complaints analyzed and investigated the root causes?            Yes         No

     4. Are corrective and preventive actions taken to eliminate the non-        Yes         No

     5. Is the corrective and preventive plan communicated with the              Yes         No

     6. Is there any adequate traceable handling of complaint records?           Yes         No

     7. Do records show that the corrective and preventive actions are           Yes         No
        properly conducted and monitored to be acceptable?

Rating: Handling of Complaints: Score 1 Point for each marked yes.                     Total: 6 / 7

Item #:                     Remarks:
3                           The factory had received the complaints in 16th Apr. 2005, and the
                            complaints were analyzed.
4                           Corrective actions were taken to eliminate the non-conformity.
5                           The corrective action was communicated with customer.
6                           Handling of complaint records were kept.
7                           No records were provided to show the corrective actions were
                                                                                       Costco Wholesale
                                                                               Report No.: 10051050018
                                                                              Evaluation Date: Apr 22, 05
                                                                                                 Page 17 of 23
These 8 questions can only be answered Yes or No. N/A cannot be used to answer any question in this section.
1.   There is no any evidence of trans-shipment.                                          Yes         No
2.   Does all WIP (work in progress) present at the time of the inspection have           Yes         No
     appropriate paperwork?
3.  Is the country of origin correct on all paperwork?                  Yes                           No
4.  There is no evidence of diverted shipments from other countries.    Yes                           No
5.  There is no evidence of contraband production.                      Yes                           No
6.  There is no evidence of fraudulent labels.                          Yes                           No
7.  Can WIP be completed within this factory?                           Yes                           No
8.  There is no evidence that the factory is subcontracting out garment Yes                           No
*Denotes Critical Questions
Rating: Trans-shipment Information: Score 1 Point for each marked Yes. Total:                        8/8

Item #:                     Remarks:


The factory is generally acceptable for producing products for Costco Wholesale.

Bureau Veritas Hong Kong Limited

David Horlock
Inspections Division
                                                                          Costco Wholesale
                                                                  Report No.: 10051050018
                                                                 Evaluation Date: Apr 22, 05
                                                                                     Page 18 of 23


1)   Entrance of factory    2)   Factory name               3)   Guard room

4)   Exterior of building   5)   Exit sign                  6)   Factory rule

7)   Changing area          8)   Fire extinguisher          9)   Light box

10) Raw material            11) Fabric inspection machine   12) Inspection records
                                                                      Costco Wholesale
                                                              Report No.: 10051050018
                                                             Evaluation Date: Apr 22, 05
                                                                                Page 19 of 23
13) Fire hydrant                  14) Cutting workshop   15) Metal protective gloves

16) Electronic time recording     17) First aid kit      18) Inspector

19) Defect was indicate           20) Evacuation plan    21) Drinking water and drinking
                                                             bottles were collected

22) Sewing workshop               23) Approved sample    24) Technology documents

25) Comment for approved sample   26) Labor law          27) Sewing machine
                                                                               Costco Wholesale
                                                                       Report No.: 10051050018
                                                                      Evaluation Date: Apr 22, 05
                                                                                        Page 20 of 23

28) Needle guard was equipped   29) Scissor was tied for safety   30) Maintenance records were hung

31) Ironing workstation         32) Inspection workstation        33) Conforming products

34) Non-conforming products     35) Dummy used                    36) Button attachment machine

37) Ironing workshop            38) Measurement auditing          39) Products were put into poly-bag

40) Products were hung          41) Packing workstation           42) Vacuum thread machine
                                                                                     Costco Wholesale
                                                                             Report No.: 10051050018
                                                                            Evaluation Date: Apr 22, 05
                                                                                               Page 21 of 23

43) Pallet was used                  44) Packing workstation            45) Sensitivity check for metal

46) Products were put into cartons   47) Pallets were used for packed   48) No smoking sign

49) Another cutting workshop         50) Another sewing workshop        51) Button hole locking machine

52) Button attachment machine        53) Packing workshop               54) Metal detector
                                                                  Costco Wholesale
                                                          Report No.: 10051050018
                                                         Evaluation Date: Apr 22, 05
                                                                          Page 22 of 23
55) Metal detector    56) Steam boiler                57) Dining room

58) Dormitory         59) Medical facilities          60) CAD designing workroom


61) Barcode scanner   62) Broken needle replacement
                                                                                                                          Costco Wholesale
                                                                                                                  Report No.: 10051050018
                                                                                                                 Evaluation Date: Apr 22, 05
                                                                                                                                              Page 23 of 23

                        Client Name:           COSTCO WHOLESALE
                              Address:         999 LAKE DRIVE
                     City / Province:          ISSAQUAH, WASHINGTON 98027
                              Country:         USA
                               Contact:        Becky Berg

                              Fax No.:         425-313-2056

                               Vendor:         525 Made in America

  Factory Name and Address:                    Suzhou Jienisi Textile Co., Ltd

               Service Performed:              Factory Evaluation

                      Auditor Name:            Buick Bie/Danny Chan

                       Service Date:           Apr 22, 05

                        Report Date:           Apr 27, 05

                         Total Pages:          23

The conditions observed during the Factory Evaluation are detailed in the preceding pages.

                                                                                          Bureau Veritas Hong Kong Limited

                                                                                          David Horlock
                                                                                          Inspections Division
The above reflects our findings for the particular factory in concern on the date of our service only. This report does not certify, confirm or imply: a) compliance
with any government, industry or association regulations or standards, unless stated otherwise; or, b) the quality of any specific products manufactured by the
factory/sellers/suppliers; or, c) the shipment of any specific products. This report does not discharge or release the factory/sellers/suppliers from their commercial,
legal or contractual obligations with buyers in respect of products manufactured by the factory/sellers/suppliers. Our services, including reports and certificates,
are subject to the General Conditions of Service of Bureau Veritas which have been sent to your company. They can be resent upon written request. This report
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