New Trade Directions Emerge, While Forced Labor and Structural Risks Plague Global Supply Chains

NEW TRADE DIRECTIONS EMERGE, WHILE FORCED LABOR AND STRUCTURAL RISKS

PLAGUE GLOBAL SUPPLY CHAINS

ASIAINSPECTION Q2 BAROMETER

HONG KONG, APRIL 7, 2016

ASIAINSPECTION (AI)

A LEADING GLOBAL QUALITY CONTROL AND COMPLIANCE SERVICE PROVIDER THAT PARTNERS WITH BRANDS, RETAILERS AND IMPORTERS AROUND THE WORLD

TO SECURE, MANAGE AND OPTIMIZE THEIR SUPPLY CHAIN

today announces its 2016 Q2 Barometer, a quarterly synopsis on outsourced manufacturing and the quality control services industry.

CHINA SHOWS SIGNS OF RECOVERY

China ’s manufacturing sector showed expansion in March, giving rise to hopes for a continued recovery, recording a Q1 2016 global growth of 6.7%.

2016 GLOBAL TRADE POISED TO REBALANCE, BUT QUALITY STILL AN ISSUE

AI data showed the number of inspections in Brazil has tripled in Q1 2016 compared to Q1 2015, but a 13% increase in Beyond AQL rates.

Q1 2016 vs Q1 2015 Inspection Growth Q1 2016 vs Q1 2015 Beyond AQL Rates

x3

+13%

AQL

STRUCTURAL RISKS RUN HIGH IN VIETNAM, BANGLADESH AND EGYPT

Vietnam is the highest-risk country for structural issues, with 71% of structural audits assessing facilities as “at risk” or “need improvement.”

STRUCTURAL RISKS RUN HIGH IN VIETNAM, BANGLADESH AND EGYPT

In Bangladesh, demand for structural audits tripled YoY in Q1 2016 in the wake of the inspections by Accord and Alliance.

Q1 2016, Egypt showed the greatest growth of structural audits outside Asia, AI data states 50% of structural audits revealed that facilities are at

risk or need improvement.

FORCED LABOR AND TRACEABILITY NAMED HIGHEST SUPPLY CHAIN RISKS OF 2016

The movement of Syrian refugees resulted in a dramatic spike of forced and child labor in Turkey’s RMG sector. Demand for ethical audits tripled YoY in

Q1 2016 vs. Q2 2015.

FORCED LABOR AND TRACEABILITY NAMED HIGHEST SUPPLY CHAIN RISKS OF 2016

Traceability remains a top supply chain challenge, as highlighted by the recent unauthorized subcontracting scandal around the Australian surfwear

brand Rip Curl.

87% APPAREL TESTED FAILED METAL DETECTION TESTS

As apparel brands feel the pressure to improve quality and safety, demand for metal control detection has become more significant.

Concerns may be justified, as 87.5% of metal control audits in Q1 2016 showed improvements were required.

87.5%Fe

AsiaInspection (AI), a leading global quality control and compliance ser vice provider

that partners with Brands, Retailers and Importers around the world to secure, manage and optimize their supply chain.

ABOUT ASIAINSPECTION YOUR EYES IN THE FACTORY!™

ABOUT ASIAINSPECTION YOUR EYES IN THE FACTORY!™

DEDICATED ACCOUNT MANAGER

A supply chain partner offering advice on your specific needs

INDUSTRY LEADING TURNAROUND

Onsite within 48 hours. Reports the same day 80% of the time

COMPREHENSIVE ONLINE MANAGEMENT

Use your real-time dashboard to benchmark and identify your high performing suppliers

FLEXIBLE

Cancel or modify orders up to 4pmthe day before the inspection for free

PRODUCT EXPERTISE

Hundreds of off-the-shelf customizable product specific checklists

TRUSTED AND TRULY INDEPENDENT

100% QC. AI is not involved in sourcingand protects your factory information

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FOOTNOTES

1. http://www.thestandard.com.hk/breaking-news.php?id=72981

2. http://www.theguardian.com/business/2016/apr/01/chinas-factory-output-grows-for-the-first-time-in-nine-months

3. http://www.ft.com/cms/s/0/699def92-dbb3-11e5-9ba8-3abc1e7247e4.html#axzz44Th4VBsU

4. https://sourcingjournalonline.com/vietnam-bangladesh-enjoy-biggest-share-gains-of-u-s-apparel-imports

5. http://www.huffingtonpost.co.uk/2016/02/01/syryan-refugee-children-labour_n_9131020.html

6. https://maplecroft.com/portfolio/new-analysis/2016/02/15/human-rights-outlook-2016/

7. http://www.theguardian.com/australia-news/2016/feb/22/rip-curls-use-of-north-korean-factories-leads-to-calls-for-industry-transparency