Key takeaways
- Audit before the first order, when you can still choose another supplier, not after a failed inspection.
- Check the registrations yourself: a GSTIN and an IEC are basic proof that a firm exists and can export.
- In Indian craft clusters much of the work happens outside the main unit. Map every subcontracted step.
- A capability audit is not a social audit. If your retailer requires SMETA or amfori BSCI, the factory needs an audit under that scheme.
Legal existence and documents
Start with proof that the business is real and that it is the business you are paying.
- GST registration. Ask for the GSTIN and check it on the government GST portal's taxpayer search. The legal name, trade name and principal address should match the factory you visit and your pro forma invoice.
- Importer Exporter Code (IEC). Issued by the DGFT. No export may be made without an IEC unless specifically exempted. The DGFT site lets you view an IEC with its number and the start of the firm's name.
- Bank details. The account name on the invoice should match the registered name. A personal account or a different company name is a warning sign.
- Licences and consents. Factory licence, fire safety and pollution-control consents where they apply to the site.
- Ownership. Who owns the factory, and is the person you deal with an owner, an employee or an agent?
Site, capacity and production process
Walk the whole site, from raw material store to packing area, and compare what you see with your order.
- Machinery. List the main machines, their condition and whether they run. For furniture: panel saws, planers, moulders, CNC routers, sanders, spray booths and welding sets.
- Workforce. Headcount on the day against the number the factory quoted, and the skills your product needs (carvers, upholsterers, welders, finishers).
- Floor space and storage. Room to make, dry, finish and pack your quantity, and covered storage for packed goods.
- Order book. Other orders in production in the same weeks. A factory running at full capacity may subcontract your order without telling you.
- Process flow. Each step for your product, in order. For solid wood, ask where timber is seasoned or kiln-dried and how moisture is checked (see wood moisture content).
- Lead time. Does the factory's own schedule support the ship date it promised, allowing for festival shutdowns and monsoon drying times?
Quality system
A small workshop does not need a certified management system, but it does need checks at each stage. Ask to see them working, not just written down.
- Incoming materials. How timber, fabric, foam, hardware and finishes are checked on arrival, and whether rejected material is kept apart.
- In-line checks. Who checks work in progress, against what, and what happens to a defective piece.
- Final inspection. Does the factory inspect before packing, with what sample, and are the records kept?
- Approved samples. Is there a sealed golden sample for each style, and do supervisors use it?
- Measuring tools. Tape measures, moisture meters, scales: present, working and checked.
- Complaints and corrective action. How the factory handled its last customer complaint.
Subcontracting
In Indian craft clusters, carving, inlay, metal work, finishing, embroidery and weaving are often done by smaller units or by home-based workers. That is normal, but you need to know about it, because it affects both quality and social compliance.
- Which steps happen outside the main site, by whom and where?
- Do the factory's own machines and headcount match the volumes it ships? A large gap means work is done elsewhere.
- Are there written agreements with subcontractors, and does the factory check their work on return?
- Will the factory tell you before it moves your order to another unit?
For wood products, subcontracting also matters for timber traceability under the EUDR and the Lacey Act. See FSC and timber legality in India.
Product controls, workforce and environment
Product-specific controls. Checks that matter for your category: moisture records for wood, foam and fabric certificates for upholstery, coating data for metal, packing and drop testing for fragile goods (see furniture packaging and drop testing), and how labels and markings for your market are controlled.
Workforce and safety (basic observations). Working hours as shown in attendance registers, how age is verified at hiring, wage records, and health and safety on the floor: guards on machines, dust and fume extraction in sanding and spray areas, fire extinguishers, clear exits and first aid. These are observations, not a full social audit.
Environment. Waste and offcut handling, effluent from finishing or dyeing, chemical and solvent storage, and the consents that apply to the site.
Red flags and how the audit is reported
- The address on the GST record or the invoice does not match the site you visit.
- The factory will not let the auditor into some areas, or asks to schedule around "a busy day".
- Few machines or workers for the volume quoted, with no explanation of where the work is done.
- No final inspection records, or records that all look the same.
- Payment requested to an account in a different name.
A Clear To Load factory audit is a scored audit in 8 sections, covering process, capacity, quality control and subcontracting among others, with photos and basic social-compliance observations. It costs US$449 per audit day, plus travel by band (no travel fee in Jodhpur); see pricing. An audit can be combined with a pre-production inspection on the same visit. See factory audits in India or book an audit.